Preparing for Challenge – Consistency in Collections

Kirstin Roberts, Director, Freeths Clean Energy, Waste & Sustainability team, recently attended a day at CIWM Resourcing the Future and was lucky enough to chair the Workshop on “Consistency: Looking at the Procurement Challenge: What procurement challenges will be posed to Local Authorities when consistent collections are rolled out?”

Whenever public sector bodies let contracts for goods, services or construction works, they must do so in accordance with UK public procurement law (currently, Public Contracts Regulations 2015 (PCRs)). The context of the workshop was that if the roll out of consistent collections in your area necessitates a variation to a publicly procured collection contract, that variation must be done in accordance with the PCRs. The Decision Tree if a variation is required would look like this:

Few Contracting Authorities would want to terminate their existing collections contract – even if they could. The Decision Tree therefore needs to be worked through to assess what the options are.

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Top Tips from the Workshop

• If you’re currently procuring a new waste collection contract:
  • Do soft market testing to find out who might bid and what facilities they have in the area to deal with the treatment of food waste.
  • Ensure any new contract is drafted in accordance with Regulation 72(1)(a) PCR to ensure that variations required as a result of the roll out of consistency in collections are what’s known as “permitted modifications” and allowed under the PCRs without restrictions on value. Review clauses should be clear, precise and unequivocal stating the scope and nature of possible modifications, as well as the conditions under which they may be used, and do not provide for modifications that would alter the overall nature of the contract.
  • Give the Contracting Authority a right to vary the contract in the event of a change in law (which consistency in collections will only be if the contract says that’s the case) and ensure you get your definitions of “qualifying change in law” right.
  • Use the competitive dialogue procedure and get your bidders to model waste volumes and waste consistency over the life of the contract – that way, the risk of waste collections not being as expected, is on them.
  • If you’re still not sure what services you’ll need, you can consider a short term contract, BUT what will be the private sector appetite for a short term contract? It would be understandable if they passed the cap ex costs of procuring new vehicles and/or facilitates onto the Contracting Authority if the contractor cannot be sure of a long period over which to recoup its investment.
• If you’re currently, in contract and will need to vary:
  • Work collaboratively with your contractor. They will be having difficulties:
    • Procuring food waste collection vehicles.
    • Procuring caddies.
    • Perhaps dealing with all the collection contracts to which they are party, all needing to be varied at the same time.
    • Assess who bears the risk of variations under your contract and who bears the cost of them. This may be something that you have to negotiate outside the contract with your contractor.
  • Get your members on board early.
  • Get your householders on board early – you’ll need a clear campaign to teach them what the new rules will be. WRAP model the steps householders must go through in order to change their behaviours and has useful materials: Consistency in collections: A step change in household recycling.
  • Is “best value” to take waste collection services in house? Can you band together with neighbouring waste collection authorities to make that more efficient and reduce costs?
  • Other things to consider:
    • Unless you’re a Unitary Authority, start working early with your Waste Disposal Authority. What are the consequences of variation of the collection contract on them, e.g. if they have existing contracts with haulers/treatment facilities/EfWs.
    • Consider what treatment options for waste there are in your area?
    • What are the risks to the Contracting Authority’s reputation? Unhappy residents means unhappy members.

How will the UKs new Public Procurement Bill affect things?

In summary the Procurement Bill is set to update the Public Contracts Regulations 2015 to allow more flexibility for Contracting Authorities (CA) to tender goods and services compliantly, as well as facilitating a modern procurement structure future-proofing procurement processes to keep pace with technological advances.Key takeaways include:

• a flexible route to competitive procedures allowing CA’s to choose the best route to market;
• updating requirements for a direct award;
• a duty on CAs to have regard to barriers affecting small/medium businesses and how to overcome them;
• emphasis on value and CA requirements when awarding contracts;
• greater scope for modifications of a contract during its term.

Find a current summary of The Procurement Bill here.

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If you want to talk to an expert about your options, feel free to contact Kirstin Roberts or Shireen Eliyas.