Purpose

Proposed
decision
 
(i) REPROCURE
contracts for the operation of 17 HWRCs and co-located
WTS;
 
And
subsequently,
 
(ii)      
DELEGATE authority to the Director for Environment and Circular
Economy, to take relevant actions to facilitate the required
procurement activity; and
 
(iii)     
DELEGATE authority to the Director for Environment and Circular
Economy in consultation with the Cabinet Member for Environment, to
take relevant actions, including but not limited to, awarding,
finalising the terms of and entering into the relevant contracts or
other legal agreements, as necessary, to implement the
decision.
 
Reason for the
decision
 
The option to reprocure the service is
recommended by the Cabinet Member for Environment as this option
will enable KCC to drive savings through economies of scale and be
assured that it is paying the current market price for the
service.
 
Background
 
As the Waste Disposal Authority, KCC has a
statutory responsibility to arrange for the disposal of the
controlled waste collected in its area by the waste collection
authorities, and to provide places at which persons resident in its
area may deposit their household waste and for the disposal of
waste so deposited.
Contracts with FCC Environment Ltd and
Commercial Services Kent for the operation, management and haulage
services Household Waste Recycling Centres and co-located Waste
Transfer Stations are due to expire on 31 October 2025.
 
Other Options
considered but discarded
 
Option 1 - Do
nothing. Discounted due to failure to meet statutory
duties.
Option 2 – Extend with FCC and CSKL for 5 years, as per the current
contractual terms. Discounted as this option is unable to
demonstrate best value and does not test the market for potential
economies of scale.
Option 3 – Extend with FCC and CSKL for 7 years. Discounted due to legal
and procurement risk.
Option 4 - CSKL
to operate all sites.  Discounted due to technical and
operational risk and unable to demonstrate best value.
Option 5 - FCC
to operate all sites. Discounted due to legal risk.
 

The commission of this contract will meet KCC’s Framing
Kent’s Future 2022-2026:
Priority 3
– Environmental Step Change -Continue to work
with our commissioning partners to create the infrastructure and
jobs that enable us to reprocess waste materials and produce energy
within the county, in order to maintain a closed loop local
economy.
 
Securing Kent’s Future -
Budget Recovery Strategy regarding the following
outcomes:
 
Objective 2: Delivering savings from
identified opportunity areas to set a sustainable 2024/25 budget
and MTFP: Contract Review
 
Financial
Implications
 
The current budget for 2024/25 is
£13,344,800 which covers operational 17 sites.
 
Payable Exit fees and costs associated with
procurement (£250k), demobilisation and remobilisation
(£450k) are unbudgeted pressures.This will bring several
sites up to an ongoing serviceable standard which may be required
before they are handed over to a new provider to maintain.
 
These costs can be treated in several ways,
KCC can either pay it at the close of the contract, it can be
included in the procurement as a set up cost or amortised over a
period of time but will remain a budget pressure
 
There is a risk to the delivery of MTFP
savings during the procurement process, which will need to be
managed with the incumbent contractors. Going forward these
improvements may be included in the new contract specification and
therefore can be priced and secured in open
competition. 
 
A procurement process will
enable KCC to be satisfied that it is paying the current market
rate for these services and economies of scale may help to drive
efficiencies in the service. However, there is no guarantee that
the tendered price will be more attractive than the current
price.
 

Decision

As Cabinet Member
for environment I agree to:
 
(i) REPROCURE contracts for the operation of 17
Household Waste Recycing Centres and
co-located Waste Transfer Services; And subsequently,
 
(ii) DELEGATE authority to the Director for
Environment and Circular Economy, to take relevant actions to
facilitate the required procurement activity;
 
(iii) DELEGATE authority to the Director for
Environment and Circular Economy in consultation with the Cabinet
Member for Environment, to take relevant actions, including but not
limited to, awarding, finalising the terms of and entering into the
relevant contracts or other legal agreements, as necessary, to
implement the decision.