Fingal to withdraw from the waste collection business by the end of the year

[David Cochrane]

Fingal County Councillors have been informed that the council is withdrawing from public bin collection by the end of the year, leaving it to private collectors to handle waste collection.

Councillors were informed today by letter that the council would lose €7m in 2012 from waste collection as many residents were turning to private collection services.

Dublin City Council are likely to be somewhat embarrassed over this situation, it is now the only council in Dublin that provides a collection service to residents and on behalf of itself and the other three councils (Dun Laoghaire-Rathdown, South Dublin and Fingal) has guaranteed 320,000 tonnes of waste to the Poolbeg Incinerator each year. Dublin City Council by itself collects just 82,000 tonnes of waste.

Below is the "memorandum" sent by County Manager David O'Connor. The emphasis (the €7m figure in bold 3 times) is from the memorandum itself.

Memorandum

To: All County Councillors
Re: Domestic Refuse Collection Service provided by Fingal County Council
From: David O’Connor, County Manager
Dated: 5th July 2011


Councillors will have read newspaper reports regarding the future of the Bin Service in Fingal. In addition I am aware that you may have been contacted to solicit their views on this matter. Councillors have raised the issue on the Agenda of the County Council Meeting on Monday next. In the interest of keeping you up to date on the current situation and wishing to pre-empt that debate, I have decided to send you this briefing note to explain the background to the current position, and the most up-to-date position as of now.


You will be aware, arising from the advice provided to Councillors in the pre-Budget explanatory memoranda year on year now, that the Council incurs an annual loss on the operation of the Domestic waste collection service. In effect monies are diverted from other budget areas to defray the losses in the Environment Budget arising from the operation of this service. Up to the 1990s, before the introduction of Waste Charges, Council budgets completely subsidised the domestic refuse service in its entirety and these were operated exclusively by local authority throughout the country.


From the late 1990s onwards however, arising from the requirements for a more sustainable and responsible behaviour to our environment, the adoption of the policy of the “Polluter Pays” made it mandatory to use financial, amongst other regulatory instruments, to penalise environmental impact and reward action towards reducing such impacts through reduction, reuse and recycling.


The policy context for the operation, regulation and control of refuse disposal has, for some time now, been complex, inconsistent and unresolved. Opportunities for waste contractors to offer services in that context has resulted in a gradual erosion of the service provided by local authorities and, by now, the number of Local Authorities continuing to offer such services is very much in the minority. Fingal has seen its customer base eroded due to the ability of private waste contractors to offer services to households at lower cost. In addition the availability of a Waiver system for local authority services and the absence of a requirement for same from the private waste operators has meant that, in straitened economic times, the sole customer growth area is in the Waiver customer area while the full paying customer takes up options of switching to different service providers offering lower costs.


The exceptional service of our Fingal Bin Service crews in reacting to competition through rationalisation of routes, increased productivity in a continuing spirit of public service has not proved sufficient to sustain against loss of customers and continuing loss of income. In recent months SIPTU, the trades union representing the Bin Service workers, approached the Council with a request to jointly examine the feasibility of making the service break even in the face of known competition. They proposed commissioning an agreed consultant to report to the Council and SIPTU. The name proposed by the union was agreed to by the Council and the completed report was presented to the Bin Service workers, having been presented to the Council and senior SIPTU officials immediately previous to a meeting on Wednesday 29th June last.


The report concluded unequivocally that there was no prospect of the service being made cost-neutral to the Council in the current competitive context. The loss of customers, the increasing demand for waivers and the inroads of competition from private operators combined to project a minimum loss of €7m (inclusive of service support costs and VAT) projected for the Budget for the service for 2012 should the service continue on the current basis. It is the opinion of the consultant that this level of loss could not be recovered through efficiencies of operation on behalf of the Council or its workforce for that period.


The Bin Service staff were informed at a meeting with the consultant who thoroughly briefed them and answered all questions. The meeting was attended by senior Council officials.


The Council management is now in discussions with the Bin Service workers through their union SIPTU on the issues arising from this consultant’s report. It is the case that the decision to withdraw from the service is inevitable, as the projected loss of €7m through the continuance of this service will not form part of Budget 2012, as the Manager will exercise his exclusive authority in the area of Waste Services in this regard.


The sole alternative to this course of action is to remove €7m from all other Budget areas for Budget 2012. Such a course, particularly when combined with the indications of the Minister for the Environment that he wants to see substantial lowering of Rates for business for 2012 to aid in job creation and economic recovery, would make it mandatory to entirely suspend or withdraw core services provided by the Council. In November this year we will have had three successive years of cost reductions and savings. “Discretionary spend” is non-existent and it is now solely through efficiencies and cost-reduction that we continue to deliver our core services. The cross-subsidy of Domestic Waste services through non-expenditure in other areas is simply no longer possible due to the level of loss in that area confirmed by the report of the independent analyst jointly commissioned.


Regarding the Bin Service staff, they have been informed that there will be no compulsory redundancies and that redeployment into areas where there is need for staff, due to the continuing reduction of staff numbers, will be arranged. Discussions on the detail of such arrangements are now commencing with SIPTU on behalf of the Bin Service workers in this regard.


For our customers Fingal County Council will continue to provide, or see to the provision of, a Bin Service for 2011 for those who are registered through the payment of their fixed charge. The issue of Waivers will be form part of the considerations of the Manager in the context of our exit strategy from the direct provision of the domestic waste service.

[lostexpectation]

council abandon the health of their public, fantastic

[Keith-M]

Why does a local authority need to be involved in waste collection, this is a prime candidate for outsourcing.

[lostexpectation]

Why does a local authority need to be involved in waste collection, this is a prime candidate for outsourcing.

its a health issue, it should be core business of government.

surely the private operators will bring waste to the incinerators once all their disagreements about levys etc are sorted out

[David Cochrane]

Private collectors have already invested in their own means of handling the waste, but now the City is trying to force them to abandon their means of disposal and bring it to Poolbeg. Justice Liam McKechnie ruled that the waste operators own the waste when collected and cannot be told where to bring it for disposal/treatment.

[Keith-M]

its a health issue it should be core business of government.

A health issue it may be but that doesn't mean it needs to be a business of government. We already outsource several areas which have health implications. Specialism is the way to go and colecting waste isn't a core competency of local government.

surely the private operators will bring waste to the incinerators once all their disagreements about levys etc are sorted out

Yes of course they will, we're watching a none too subtle negotiation by press release.

[David Cochrane]

I've updated the OP to include the "memorandum"/"briefing" given to the Councillors today by the County Manager.

[hammer]

Amazing. What will happen all the staff involved in waste collection

€7 million loss from collecting bins once a week. Well done, take a bow.

[He3]

Cork city has this week announced it is ending its waste collection service.

[gijoe]

Amazing. What will happen all the staff involved in waste collection

€7 million loss from collecting bins once a week. Well done, take a bow.

I'd imagine they were handing out a lot of waivers etc making it more expensive for those who pay, subsidising those who do not, and then taking their business to the cheaper private operators.