| Topic: | Re:Re:Re:Re:Re:Re:Rubbish not collcted | |
| Posted by: | Paul Webster | |
| Date/Time: | 09/05/18 11:38:00 |
| The plan to change was confirmed in Ealing Council Cabinet meeting of 20th March. Minutes of that meeting show: Resolved That Cabinet: notes the findings prepared by Eunomia Research and Consulting Ltd attached at confidential Appendix 1 of the report. agrees to the termination of the Council's Environmental Services Contract with Enterprise Managed Services Ltd for the provision of Waste & Recycling Collection, Street Cleaning, Grounds Maintenance, Burials and Associated Services (subsequently acquired by Amey Plc) with termination to take effect no later than 5 July 2020. delegates authority to the Executive Director of Environment and Customer Services, following consultation with the portfolio holder for Environment, Transport & Leisure and the Director of Legal and Democratic Services, to negotiate exit terms with the Contractor and to enter into a Deed of Variation/Exit Agreement to give effect to those terms as necessary. agrees that the Executive Director of Environment and Customer Services should give further detailed consideration to bringing the services under Council control through either an in-house option or establishing a wholly owned local authority company and report back to a future Cabinet with a recommendation on the approach that should be taken. Reason for Decision and Options Considered The Council commissioned Eunomia Research and Consulting Ltd to assess in detail the costs of performing the services (and thus verify the losses claimed by Amey), assess the possibility of savings in the service, and to detail the costs of the options to re-procure the service, or bringing the services under Council control through in-sourcing or establishing a local authority trading company wholly owned by the Council for the operation of the services. Their summary findings are presented in their report which is attached at confidential Appendix 1 of the report. Amey have concluded that they cannot continue to make significant financial losses on the contract and would need further funds from the Council. This position supports Eunomia's findings. contained in the appendix to the report. Analysis by Eunomia Research and Consulting Ltd also shows that there are no significant inefficiencies in the operation of the service by Amey that could be addressed in order to mitigate their losses without substantial changes in service standards. An assessment of the options available to the Council showing the estimated service costs are included in the report: All the options include the application of the London Living Wage. Costs are based on the current operational resources (crews, employee numbers, vehicles, management and supervision, administration) Amey has in place and includes repayment of capital costs for vehicles, set up costs, and in the case of the in-house and local authority trading company, corporate overhead allocations. The outsource option includes corporate overhead and profit at 8%. Although much detailed work has been undertaken, it should be noted that further detailed analysis is needed to assess the implications arising from either of the options of bringing the services under Council control including employee implications. In addition, further work is needed to assess options for the governance of a local authority company and the financing arrangements. A substantial increase in service costs reflects that the Council's service has, in effect, been subsidised by Enterprise Managed Services Ltd and then Amey since the contract start date in 2012. It is highly unlikely that a company in a further round of procurement would price on a similar basis to that seen under this contract. On the basis that costs of the service are going to increase in any of the above three scenarios and given the Council's current budget situation, the ability to control and flex service costs directly will be important. The Council has agreed an Active Citizen's programme to increase the level of control and involvement residents have in their environment (such as parks and green spaces) and this will mean the ability to respond and tailor services at a more local level. Such service changes are more easily achieved through a Council controlled entity. |