business case for an improved waste and recycling...

Appendix 1

Business Case for an Improved Waste and Recycling Service

Background

The Council has to replace approximately half its vehicle fleet in 2013 which is intended to

support its waste and recycling collection requirements for the following seven years

minimum. The type of vehicles it procures will be determined by the type of collection service

which in effect will be set for the seven year planned life of the vehicles. The opportunity has

therefore been taken to review its collection options according to local circumstances,

national trends, customer research, market developments and service cost.

At the same time, Northamptonshire County Council (NCC) is procuring its residual waste

disposal service and needs to know the tonnage and residual waste nature of each its waste

collection authorities. This service review will provide this information.

Given all these changes, the opportunity has been taken to review the current waste and

recycling collection service to determine what improvements can be implemented within the

cost constraints facing the Council. From an options appraisal undertaken by the Council’s

Review and Development Service Delivery Committee, the Cabinet at its meeting on 13

February agreed;

§ That officers be requested to submit a detailed business case for a weekly food waste collection service and moving to a three wheelie bin system by introducing an additional bin to collect dry recyclable materials including card in 2013 to the April meeting of Cabinet, such business case to include the proposed consultation process to achieve support for a weekly food waste collection service;

§ That the Cabinet supports the Review and Development Committee’s recommendation not to introduce charging for the garden waste collection service;

§ That Cabinet delegate authority to the Director of Community and Environment and the Head of Environmental Services, in consultation with the Portfolio Holder for Environment and Waste management to submit an expression of interest for funding and that further consideration of an outline bid be given to Cabinet at its April meeting.

This is a complex project which is reflected in the high number of inter-dependent

components necessary to deliver the new collection service successfully. This Business

Case contains the current position, relevant issues and proposals for each of the following

sections;

Food Waste Collection

Three Wheelie Bin System

A Four Day Collection Week and Rounds Review

Implementation Period

Vehicles - Purchase v Leasing and New Vehicle Requirements

Procurement Processes and Timescales

Outline Communications Plan

Project Management

HR Implications and Proposed Further Elected Member Consideration

Risk Management and Current Uncertainties

Financial Implications

Food Waste Collection

Currently, all food waste is either put in the residual waste bin for the majority of residents or

is home composted by a relatively small number of households. Food waste can constitute

upwards of 30% of the weight of most household’s residual waste bin. Therefore, having a

separate collection arrangement and treatment for this type of waste, will have a significant

effect on the tonnage of waste sent to landfill. This fact has been recognised by many waste

collection authorities which is why there is a growing national trend for this form of waste to

collected and recycled.

There are two main types of food waste treatment facilities - Anaerobic Digestion (AD) and

In-Vessel Composting (IVC). Usually food waste collected separately is sent to AD facilities.

Food waste collected with garden waste is sent to an IVC facility.

Anaerobic digestion works by breaking down food waste without the presence of air, leading

to the production of methane. The methane is drawn off and burnt by a gas engine which

produces heat to heat the anaerobic digester and to also generate electricity. Since the

electricity produced is now considered renewable, the operation of AD plants have become

more attractive in recent years.

IVC works by breaking down food waste with the presence of air. No methane or electricity is

produced in this process. The capital costs of building IVC plants can be less than ADs but

the running costs are not offset by electricity generation. Consequently ADs are becoming

more common as financially they become more attractive to own & operate than IVC sites.

Hence collecting food waste separately is becoming more common amongst collection

authorities than collecting mixed with garden waste. Collecting food waste separately on a

weekly basis is likely to ensure the maximum capture of food waste. Collecting food waste

mixed with garden waste usually captures slightly less food waste partly because such

collections are usually on a two weekly basis.

NCC has decided not to provide food waste processing facilities. Instead NCC are offering

districts £77/tonne for each tonne of food waste recycled. This is significantly more than

statutory recycling credits. The treatment costs for food waste collected separately are likely

to be in the range £40-£55/tonne. Hence the £77/tonne offered by NCC will not only cover

the treatment costs but will make a small contribution towards the additional running costs of

collecting food waste. As this is a non-statutory payment some certainty that these payments

will not be removed will be sought from NCC.

For the householder, best practice is to provide two caddies to each household. One is

usually 20-30 litres in volume and is kept outside with a lockable lid. The second is kept in

the kitchen closer to where the food waste is generated. The kitchen caddy is usually 5-7

litres in volume and holds 2 or 3 days of food waste arisings. Once full it is emptied into the

outside caddy. The kitchen caddy will be optional for households as some households would

prefer to empty their food waste directly into the larger caddy.

NCC through the Northamptonshire Waste Partnership (NWP) have set aside the capital

funds for districts to fund caddies. In total to provide each property in the District with the two

different sizes of caddies is estimated to be £180k. This funding is already set aside for

South Northamptonshire.

Some households like to line their kitchen caddies. This can usually be done by using

compostable liners or using paper. Good practice often shows that issuing a starter roll of

compostable liners helps initial participation and subsequently helps to develop permanent

recycling habits. This is because the liners can convince residents that food waste recycling

can be relatively clean. However very few councils issue free compostable liners beyond the

initial rollout due to the significant cost – typically £150k per year. Compostable liners are

sold from most supermarkets at about 10-12p per liner.

To collect food waste there are two main types of vehicles - smaller vehicles (typically 7.5 -

12 tonne) and larger refuse collection vehicles (RCVs) with a food waste pod. The small

vehicles seem best suited in urban areas where a two man crew can typically cover 2500 –

3000 properties per day. They empty the caddies into a wheeled bin and empty the wheeled

bins into the smaller vehicle.

Podded vehicles allow food waste to be collected at the same time as other materials. For

instance on one week they may allow the collection of food waste while a refuse collection is

being carried out and on the second week they may allow the collection of food waste while

co-mingled dry recycling is also being collected. They require an additional crew member in

urban areas but in less densely populated areas the collections in most cases do not require

an additional crew member.

The Government has made £250 million available for councils to bid for funds supporting

weekly waste collections. Although weekly refuse collections will receive the most favourable

response, weekly food waste collections will be considered. The fund is meant to support

food waste collections which would have not occurred unless they received financial support.

In addition, for a bid to be successful it must show that the scheme is supported by

residents. An expression of interest for £375k to support additional vehicle needs, launch

and publicity costs has been submitted. If the Council wishes to proceed, an outline formal

bid must be submitted by 16 May 2012 with a full bid submitted by mid August. The final

decision on award is due in October 2012.

It is proposed that food waste is collected on a weekly basis separately subject to financial

support from NCC as outlined above and support from the government’s £250m fund.

Householders would receive two caddies with these caddies being funded through

NCC/NWP capital funds. It is also proposed that a mixture of podded vehicles and small

vehicles are procured to allow district wide collections of food waste, with the small vehicles

concentrating most productively and therefore cost effectively on the urban areas. It is also

proposed that a procurement exercise is undertaken to source treatment facilities for food

waste collected.

Three Wheelie Bin Collection System

The current service can be summarised as follows

• Recycling: just over 35,000 households in South Northamptonshire receive the ‘standard’ household service: in week one cans and mixed plastics are collected in a black kerbside box. This mix has been supplemented from April this year by card from the green wheelie bin. In week two, paper and glass are collected in a green kerbside box. Around 920 flats receive a weekly dry recycling service for glass, cardboard, paper, cans and plastics from large communal wheeled bins. A total of 5,763 tonnes of dry recycling was collected in 2010/11.

• Garden waste: Garden waste and card was until April 2012 collected co-mingled in a green wheeled bin until the card was removed from April this year. Collections of garden waste only are fortnightly using vehicles which are alternated between the garden waste and residual waste services. A total of 10,845 tonnes of co-mingled garden waste and card was collected in 2010/11.

• Residual waste: all households also receive a fortnightly residual waste collection in a 240 litre wheeled bin on alternate weeks to the garden waste. A total of 17,368 tonnes of residual waste was collected in 2010/11.

The two bin and two box system with some kerbside-sort of recyclable materials is a

relatively expensive method of collecting dry recyclable materials. A more cost efficient

method of collection whilst encouraging maximum recycling participation by households is a

three wheelie bin system – one each for residual waste, garden waste and all dry recyclable

materials including card.

Wheeled bins for dry recycling are particularly good for collecting materials such as plastics

and card ie materials which occupy a lot of volume. Usually the introduction of wheeled bins

for recycling increases the amount of materials recycled since bins do not have the

limitations on volume which boxes have. In addition bins tend to mean that there is less wind

blown litter than boxes.

Wheeled bin collections are quicker than box collections, hence vehicles can cover more

properties per day than kerbside sort vehicles. This leads to less vehicles and lower

operational costs.

Keeping materials separate can mean better prices. However the combination of rising

commodity prices, the improvements in sorting technology and the building of many very

large Materials Recovery Facilities (MRFs) has meant prices for co-mingled materials is

strong as demonstrated in the recent dry recyclables procurement process.

Wheeled bin collections have a number of additional benefits. For collection staff, collection

involves less bending and twisting and less cut hazards since crews do not sort the materials

by hand in the less than ideal conditions of the roadside.

For residents, the introduction of a wheeled bin should make recycling easier, particularly for

items such as plastics, card & cardboard. Some residents may have space concerns –

however smaller 180 litre bins could be made available to properties which have space

constraints.

A Four Day Collection Week and Rounds Review

A number of Councils have successfully operated a four day, Tuesday to Friday collection

week with the following benefits:

• Customer – Collections will always occur on the same day and will not be disrupted for

Bank Holidays on Mondays apart from at Christmas.

• The Council – four day week systems can substantially reduce overtime payments. For

SNC this could be around £40k per annum. Other savings can also be achieved from the

reduced need for publicity to inform customers about changes to collections brought

about by Bank Holidays. In addition, collections can be set up to achieve more efficient

routes to achieve fuel savings. Finally, in the event of disruption to collections from

adverse weather events, Mondays can prove very useful to allow a quicker catch up for

collections.

• Staff – whilst the four day week requires a longer average working day, it gives staff a

three day weekend and a better work life balance. In addition, a few Mondays per year

can be utilised for training making sure staff skills are kept up to date.

Currently there are seven rounds carrying out refuse and garden waste collections. Each

round serves around 5,000 properties per week. In the proposed new collection, the seven

rounds are likely to collect refuse and food waste one week and co-mingled dry recycling

and food waste on the next week.

The current recycling vehicles will be replaced and three rounds will collect garden waste

with this team being increased to four rounds during the peak of the summer. During the low

garden waste participation period (December – February) some of the garden waste crews

may be reduced to a driver and loader only.

Although geography is important, a three wheelie bin system can enable a single crew to

collect from 6,000 properties per week . If South Northants were to increase the number of

properties per round through the three wheelie bin collection service, it is anticipated that the

number of rounds could be reduced by one. However, due to the rural nature of the District,

it may not be possible to reach 6,000 properties per week and it would leave no capacity for

the anticipated housing growth in the coming years. Consequently, it would be more efficient

longer term to retain seven rounds but not always have an extra staff member for collecting

food waste. As housing numbers increase over time, the crew sizes can increase

accordingly for part of the housing growth delivered thereby maximising the period during

which the current crews numbers can operate and delay the need for an additional crew and

vehicle.

With the tipping outlets having already changed for dry recycling materials and the outlets

possibly changing for residual waste from April 2013 and new outlets being used for food

waste and potentially garden waste, then a review of routes will be needed. The Council has

access to a NWP owned IT package called Routesmart which can help. It is likely that by the

autumn, the residual waste outlets, food waste outlet and garden waste outlets will be

known. At this point a review of rounds needs to be carried out so the most efficient routes

are implemented in relation to the tipping locations to minimise fuel consumption.

Implementation Period

There are two main options when implementing a new collection scheme – implementing in

a phased manner or implementing everywhere at once.

Implementing all properties at once in a ‘big bang’ manner, can lead to a number of

customer service & operational capacity issues. With all 36,000 households changing over a

very short period, a large number of telephone enquiries to customer services would result.

Even with clear publicity literature, good website information and road shows, some

residents will have questions. Hence there will be a rise in phone calls at the launch of a

scheme which over a short period becomes difficult to resource. Additionally, launching over

a short timescale can make operational activities such as bin deliveries difficult. Delivering

36,000 wheeled bins plus a similar number of both caddies with associated literature takes a

lot of resource if delivered over a short period.

By delivering in a phased approach, numbers of customer calls and e mails can be better

managed. In addition, activities such as bin and container deliveries can be more efficiently

undertaken.

With pressure on the customer service centre high in March and April due to Council Tax

and NNDR billing, it is proposed that a new scheme is rolled out from June 2013, in seven

stages (one for each collection round). Allowing two- three weeks between each round

implementation should be completed by the end of September 2013. This phased approach

means that resources can be concentrated more effectively on one round at a time to

support the most effective roll out and calls to the Council will be spread over a longer period

which means that volumes can be managed more efficiently and a better quality service can

be given.

Vehicles - Purchase v Leasing and New Vehicle Requirements

Currently South Northants purchases small vehicles but leases larger vehicles with

maintenance included. SFS has been the Council’s provider for some years.

There are both pros and cons to how vehicles are acquired. Leasing with maintenance

means that vehicles are leased for a fixed period of time, normally seven years. A payment

is made each year for the use of maintained vehicles. Some additional payments are made

for unfair wear and tear.

Over a 7 year life a typical refuse collection vehicle, the following lease costs are incurred:

Lease cost with maintenance £236k

Unfair wear & tear £14k

Total expenditure £250k

Over a 7 year life a typical refuse collection vehicle purchased through a framework

agreement and self maintained incurs the following costs

Purchase cost £125k

Income from sale (£8k)

Maintenance over 7 years £91k

Total expenditure £208k

Hence there is a difference estimated to be £42k per vehicle. When it is considered that the

Council has 14 refuse collection vehicles, the value to the Council of purchasing instead of

leasing over the full life terms of the vehicles will be in excess of £500k.

Additionally, purchasing allows vehicle life to be looked at on an asset by asset basis. Hence

if an asset is in good condition after 7 years, the vehicle life could be extended further and

even greater value achieved. Therefore purchasing rather than leasing vehicles is proposed.

Currently there are seven refuse collection vehicles which have leases which commenced in

2010 or 2011 and are therefore relatively new.

There are nine vehicles used on recycling collections which are due for replacement in April

2013. In total, they incur leases costing £246k per year. These costs are capitalised under

IFRS requirements.

Given the needs of the proposed new service described above, the proposal is to purchase

5 refuse collection vehicles with food pods and 2 smaller food waste collection vehicles at

the following estimated costs:.

5 Refuse Collection Vehicles £750 - £800k

2 Food Waste Collection Vehicles £110 - £125k

Total £860k - £925k

The proposal is a reduction in two vehicles but will permit the use of a combination of

retained leased vehicles and new purchased vehicles to deliver the new food waste and

three wheelie bin collection service.

Procurement Processes and Timescales

There are a number of items which need to be procured for the proposed new scheme

Containers

36,000 wheeled bins for dry recycling and two types of caddies again for up to 36,000

properties

Estimated costs are £700k for wheeled bins and £180k for caddies.

These containers would be purchased through existing framework agreements such as

Yorkshire Purchasing Organisation (YPO) or Eastern Shires Purchasing Organisation

(ESPO). The estimated lead time is 3-6 months.

Vehicles

Seven vehicles again would be purchased through existing framework agreements. For

outright purchase the estimated value is around £900k. The estimated lead time is 6-8

months

Outlets for Food Waste & Garden Waste

Procurement of these services will likely require a full EU tender. The estimated value of the

tender or tenders would be around £150k per year for food waste and £200k per year for

garden waste. The estimated lead time would be around 6-9 months.

Because of the lead time required for these procurement processes and the need for cost

certainty as soon as possible, they will be commenced as soon as a decision on the new

collection service is made and the results of the procurement processes incorporated in the

draft 13/14 budgets whenever possible.

Outline Communications Plan

It is recognised that effective communications will be critical to the successful implementation of any substantial service change. The proposed approach to communications is that there will be two strands – internal (staff and elected members) and external – to guarantee that the correct messages are reaching the appropriate audience. External communication will concentrate on providing residents with the tools and information to make the transition as smooth as possible, thereby maximising recycling levels and minimising contact with customer services. This strategy will also rely on a great deal of support from local media to provide comprehensive coverage of the changes. The central purpose of internal communication will be to ensure staff involved in implementing the transition are fully prepared to help residents with their enquiries. The secondary aim is to gain positive buy-in from all remaining staff across the council to act as ambassadors for the scheme. Key Messages

• We are making these changes as part of a comprehensive overhaul of the Council’s refuse and recycling operation. Once complete, this will ensure stability for years to come.

• While residents already recycle half of their rubbish, the Northamptonshire Waste Partnership has targeted 56% by 2020.

• The Council has just entered into a new dry recyclables contract in collaboration with Cherwell and Aylesbury Vale leading to £170,000 increase in SNC’s income for 2012/13. This is likely to rise as a result of increased recycling levels provided by new scheme.

• Greater capacity in the new recycling bin will make it much easier for residents to recycle more and send less to landfill.

• The weekly food waste collection scheme will save the taxpayer £***,*** per year in landfill costs and is expected to increase income from recyclables by £***,***. This will help the Council keep council tax at the lowest possible level and protect frontline services.

• In the face of further anticipated reductions in Government grant, the reduced future service cost of over £200,000 will help the Council protect those front line services most valued by residents.

• Food waste recycling is only a part of the picture. Residents are being urged to cut their waste through smart shopping, portion control and using leftovers. If they have any food waste, much of this can be home composted to provide a rich soil conditioner for use in their gardens. Items which cannot be home composted can now be placed in the brown caddy for recycling.

• The introduction of weekly food waste collections will help reduce the risk of any unpleasant odours in the warmer spring and summer months.

• The food waste will go to an anaerobic digestion facility where it will be turned into compost and the gas it produces turned into energy.

• If residents recycle as much as they possibly can, refuse should be evenly distributed between the three bins, meaning there will be no need for overflowing bins and recycling boxes.

• There will be no charges for the garden waste collection service.

Proposed Approach The approach should ensure all stakeholders remain informed about the various stages of development, keeping them engaged and interested in the process. Having a shortlist of potential council spokesmen will guarantee that someone is available to comment at each stage while ensuring the key messages remain consistent.

• An initial press release has been drafted outlining the changes and proposed timescales. This will be sent to all local media, trade and local government press and posted in the news section of the Council’s website following the Cabinet’s decision. It is possible some of the local media might pick up on the proposals from committee papers before they are discussed. For this reason, a statement has been prepared for release on approach.

• Detailed communications plans have been compiled showing how the development will be publicised internally and externally to gain the most advantageous response from the media, public and staff.

• A stakeholder profile list has been drawn up detailing the main stakeholders, key messages and timescales. These stakeholders have also been plotted into an interest/influence matrix which outlines who the key players are felt to be.

• A list of frequently-asked questions has been compiled and can be added to throughout the process.

• Lead Councillors will be briefed to conduct print and broadcast interviews While it is essential that all concerned concentrate on the positives, there are a number of potential risks associated with such a large-scale change to the Council’s recycling operation. These will be addressed through the proposed approach above. Draft Communication Plan and Timeline

External

Date Message Audience Method Responsibility

28 March

2012

Cabinet papers go

live

• Media (reactive)

• Statement Communications

11 April

2012

Cabinet approves

changes to refuse

and recycling

• Media

• Residents

• Press release/Twitter

• Website/SNC Review/Twitter

Communications

June 2012 One year until roll-out • Media • Press release Communications

November

2012

Bin collection

calendar – last of

current arrangements

• Media

• Residents

• Press release

• Website/SNC ReviewTwitter

Communications

February

2013

New recycling plans

forthcoming year’s

big budget news

• Media • Press release Communications

May 2013 Roll-out set to

commence next

month

• Media

• Residents

• Press release

• Website/Twitter

Communications

May, 2013 New bin collection

calendar

• Residents • SNC Review Communications

June 2013 Roll-out commences

along with start of

delivery of new

vehicles

• Media

• Residents

• Press release/photo call

• Website/Twitter/Agripa

Communications

June 2013 First collections

(wagons roll)

• Media • Press release/photo call

Communications

June/July/

August

Step-by-step roll-out

with advice for those

householders who

have not grasped the

principles of the

scheme (this will

need to be broken

down into sections

reflecting the stage-

by-stage roll-out

which will also need

to reflect how

accommodation such

as flats will be

brought on-board)

• Media

• Residents

• Schools

• Press releases

• Delivery of information packs and bins/posters in areas of high footfall/website/SNC Review/Twitter/ doorstepping/ roadshows/

telephone

holding

messages

Communications

Environmental

Services

Customer

Services

September/

October

2013

Roll-out complete • Media

• Residents

• Press release

• Website/Twitter

Communications

November

2013

First full month of

new scheme –

recycling levels

• Media

• Residents

• Press release

• Website/SNC Review/Twitter

Communications

compared with

previous year where

possible

December

2013

Christmas recycling

with particular focus

on food

• Media

• Residents

• Press release

• Website/Twitter/recipe suggestions for leftovers

Communications

Internal

Date Message Audience Method Responsibility

26/27 March

2012

Briefing Cabinet

members responsible

• Councillors Mrs Clarke, Bambridge, McCord and Herring

• Briefing session Communications

Environmental

Services

28 March

2012

Cabinet papers to go

live

• All staff and members

• In Brief/

• Nellie/Your Council Matters

Communications

28 March

2012

Contact centre

briefing

• Contact centre staff

• Staff briefing Communications

Environmental

Services

11 April

2012

Cabinet approves

changes to refuse

and recycling


• In Brief/ Nellie/Your

Council Matters

Communications

May 2012 Engagement on

implementation


• Series of in-house events

Environmental

Services

July 2012 Feedback on staff

engagement



Council Matters

Communications

September

2012

Preparation of

information packs

• Key stakeholders

• Workshop Communications

Environmental

Services

November

2012

Staff and member

engagement on

effectiveness of

information packs

• Staff and member working groups

• Workshops Communications

Environmental

Services

February

2013

Finalisation and

ordering of

information packs

• N/A • N/A Communications

April 2013 Ordering of Agripa

panels


May 2013 Ordering of posters

to go in areas of high

footfall


May 2013 Roll-out set to

commence



Council Matters

Communications

May 2013 Preparation with roll-

out staff

• Tove Depot staff

• Training Environmental

Services

June 2013 Roll-out and delivery

of new vehicles

commence



Council Matters

Communications

June/July/A

ugust

Step-by-step roll-out

(can be broken down

when timetable

devised)



Council Matters

Communications

Environmental

Services

Customer

Services

September/

October

2013

Roll-out complete • All staff and members


Council Matters

Communications

November

2013

First full month of

new scheme –

recycling levels

compared with

previous year where

possible


• In Brief/Nellie/ Your Council

Matters

Communications

December

2013

Christmas recycling

with focus on food

waste



Council Matters

Communications

Project Management

The key to a delivering this new and changed service successfully lies in a combination of

comprehensive and thorough forward planning, a very effective communication plan and

strong project management to ensure all the components of the project are delivered to the

right standard at the right time. A good start has been made in that this matter has already

had some rigorous consideration well in advance of the proposed implementation period.

However, once the Cabinet has agreed the business case for the required service change,

the planning, preparation and implementation of that change must commence immediately

and be progressed through a formal project management structure.

Given the importance of this service change, it is therefore intended to use the corporate

project governance and controls for a major project:

- A Project Board made up of the key individuals from across the Council who will be

charged with delivering the project. The core membership will be drawn from service

managers, finance, HR, communications, legal and procurement officers plus the

project manager.

- The PFH for Environment and Waste Management, the Director of Community and

Environment as joint project sponsors along with the Head of Environmental

Services to be Board members

- A Project Manager is appointed on a full time basis for the period from the beginning

of May 2012 to end of August 2013. It is proposed that this be Elly Attwood who is

currently the Council’s Environmental Team leader at the depot and who knows the

District and the service very well which will mean that her substantive position will be

backfilled.

- SNC’s project management methodology be used with oversight from the

programme office. Periodic progress reports be submitted to Cabinet meetings

- A project risk register which is actively managed and an integral part of the Board’s

focus

HR Implications and Proposed Further Elected Member Consideration

Detailed below is a timeline of relevant HR and other activity which culminates in a report to the Appointments and Personnel Committee in December 2012 along with other proposed reports to elected members to provide more detail of the proposals and progress.

Date Action Lead Officer

3 – 13 June 2011

Review of terms and conditions of Tove Depot Staff. Consultation paper informed staff that this project represented the first stages in a wider programme of work. Although the paper did not specifically mention a potential four day collection week, it referred to measures which may result in further operational and work pattern changes.

Completed

13 February 2012

Cabinet report – Future Waste and Recycling Arrangements An opportunity to review the current waste and recycling collection service to determine what improvements can be implemented.

Completed

February 2012

Team briefs – initial informal discussions have already taken place with staff about the proposed changes and a potential four day collection week

Completed

10 April 2012

Cabinet report – outline proposal for a potential four day collection week

Director of Community and Environment/Head of Environmental Services

May - July 2012

Development of Business Case and consideration by joint management team and/or JASG should a shared service be agreed.

Director of Community and Environment/Head of Environmental Services

August 2012

Informal consultation with affected staff carried out by Head of Environmental Services in conjunction with HR and Trade Unions

Head of Environmental Services

September 2012

Formal Consultation (three weeks) – consultation document issued to staff setting out the proposed changes to terms and conditions. Trade Unions invited to be involved in all stages. Consultation log maintained by HR.


October 2012

Formal Consultation meeting with staff Progress report to Service Delivery Review and Development Committee 3 October

Head of Environmental Services Director of Community and Environment/Head of Environmental Services

November 2012

Progress Report to Cabinet 12 November Consideration by Local Joint Committee

Director of Community and Environment/Head of Environmental Services Head of Transformation /Director of Community and Environment /Head of Environmental Services

December 2012

Consideration by Appointments and Personnel Committee

Head of Transformation/ Director of Community and Environment/Head of Environmental Services

Beginning of March 2013

Advise all staff of implementation plan Issue updated terms and conditions (12 weeks notice)

Head of Environmental Services HR Manager

April and May 2013

Meet with crews to clarify new arrangements Offer staff the opportunity for a 1:1 meeting with Environmental Works Manager


1 June 2013 Commencement of revised contracts to coincide with implementation of new service

Risks Management and Current Uncertainties

This business case has been compiled with the latest position as of March 2012 on all

aspects of the project. However, there are several issues which cannot be precisely

quantified at this point in the process either because the information is currently unavailable

or because they rely on other project details to be confirmed first. Those issues which fall

into this category currently are as follows;

- Finalising the external funding from NCC, NWP and potential funding from the

Government (this last element may not be confirmed until October 2012). NWP one

off funding is reasonably certain as is the NCC financial support for the food waste

collection and disposal cost. However, this needs to be formalised and clarity need to

achieved regarding the need for it to be linked to the on going provision of the service

and not time limited.

- Tipping and treatment outlets – other than for dry recyclates which have recently

been procured and therefore tipping and treatment sites determined, these cannot be

determined until the respective procurement processes for garden waste, food waste

and residual waste (an OCC process) have been completed.

- Rounds Review – this is more appropriately undertaken as part of a detailed later

piece of work which takes into account the waste and recycling tipping locations to

minimise travel time and distance, how a four day collection week can be best

implemented and making the best use of the different types of vehicles to maximise

crew productivity.

- Tonnages – the new service will result in a different make up of tonnages of waste

collected. Estimated new tonnages for residual waste, dry recyclable materials,

garden waste and food waste have been included in the modelling as a basis for

projecting overall costs. These have been influenced by the market intelligence which

Eunomia were able to offer in the early stages of this process but remain a risk until a

full operational year has been completed. This risk is felt to be a low to moderate

one.

- Food and Garden Waste Gate Fees – whilst the tonnages affect the amount paid by

the Council in gate fees, the actual gate fees per tonne cannot be determined until

the relevant procurement processes have been completed. In the meantime, average

gate fees have been included in the cost model which has also been influenced by

the market intelligence which Eunomia were able to offer in the early stages of this

process.

It is intended that the project’s risk register will include such uncertainties which will be

targeted for resolution as early as possible in the project plan.

Financial Implications

It is clear from the above that there will be many changes to the Council’s current costs and

income streams arising from the new service when compared to the current approved

budget. The initial calculations arrived at by a combined Environmental Service and Finance

team have concluded the following full year effect based on the 2012/13 revenue budget.

The figures below are a summary of the full year revenue effect following implementation

which are expected to materialise in 2014/15. There will be further one off costs in 2013/14

associated with communications, additional implementation crews and project management

which are not included here as they will be considered as specific 2013/14 budget items for

that budget preparation process.

Revenue Impact Food waste Tonnes Rate

Northamptonshire CC Credit 3,250 £77 £250,250

Gate Fee for processing food waste 3,250 £50 £162,500

2 small vehicles running costs £11,150 5 extra crew ( 1 small vehicle) + 1 on 3 of the podded vehicles £116,809

Total £40,209

Dry Recycling

Loss of income £407,000

Co-mingled income 9,500 £22 £209,475

12 staff savings (4 less drivers, 7.5 less loaders) £239,689

Fuel savings (estimated at 40,000 litres) -£43,541 Three less vehicle savings (estimated based on lease costs) £130,630

Total £216,335

Efficiencies

Four day week (overtime saving) -£40,000

Better rounds, more efficient set up less fuel -£10,000

Total -£50,000

Change

Extra food waste costs £40,209

Dry recycling saving £216,335

Efficiency saving -£50,000

Loss of Interest on Capital per year on £1.6m £14,880

Ongoing Annual Revenue Savings £211,246

There are some one-off costs of implementation for rolling out the food waste scheme.

External funding is being bid for to offset these costs but the costs are detailed below.

One-off Implementation costs Delivery of food waste containers £5,000

Advertising panels for the fleet (new and existing) £20,000

Part funding towards communication materials for householders

£36,000

Initial supply of compostable liners for all households and set up of vending machines/supply network for householders to purchase in future

£50,000

Total £111,000

Less: External funding

Government Funding £111,000

There are also capital costs associated with the proposals and these are set out below:

Capital Impact

Purchase of Refuse Collection Vehicle with Food Pod 5 £160,000 £800,000

Purcahse of Food Waste Collection Vehicle 2 £62,500 £125,000

Purchase of Wheeled Bins for Dry Recycling 36,000 £19.44 £699,840

Purchase of Food Waste Caddies 36,000 £5.00 £180,000

Total £1,804,840

Less: Funds Already Available in the Capital Programme

Vehicle Replacement (12/13) -£123,972

Wheeled Bins & Recycling Boxes (12/13 & 13/14) -£130,000

Total £253,972

Less: External funding

NCC - food waste caddies 36,000 £5.00 -£180,000

Government Funding -£264,000

Overall Additional Capital (saving)/cost (subject to Government funding being granted)

£1,106,868

business case for an improved waste and recycling...

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