Wednesday, 13 May 2015

£2.3 million loss "tip of the iceberg"

EXCLUSIVE - by Doug Collie

Several new pieces of information which have found their way into the Not Just Sheep & Rugby office suggest the failure to develop a Mechanical Biological Treatment facility to deal with Scottish Borders municipal refuse has cost the local council at least £20 million in terms of lost savings on landfill costs and associated expenditure to manage waste.

And we have also been told that one of six original bidders for the £65 million contract advertised by Scottish Borders Council was forced to withdraw from the procurement process after the local authority decided the technology they planned to use was considered "too risky".

Later SBC amended their agreement with New Earth Solutions (NES), the successful bidders, to include a form of incineration which was completely untried and untested, a decision which ultimately led to the abandonment of the Easter Langlee scheme.

Last month it was revealed via a Freedom of Information request that the council had spent £1.9 million (£2.3 million if you include Value Added Tax) on a string of expensive lawyers and consultants who appear to have only assisted in the project's abject failure.

Yet despite the alleged incompetence by councillors and paid officials involved in the debacle there appears to be a total reluctance on the part of politicians and public spending watchdogs to initiate an investigation into what went so horribly wrong.

SBC has made it clear it will not divulge meaningful information concerning its disastrous relationship with NES because of the strict confidentiality clauses embedded in the multi-million pound contract until 2021.

But Not Just Sheep & Rugby has managed to uncover more intelligence following the decision to simply write-off the loss of this sizeable amount of council taxpayers' cash.

It should be remembered that NES was ready to build the MBT plant in April 2011 when the original contract was signed. Had it been delivered on time (2013) 80% of Borders household waste would no longer have had to be buried under the ground where it rots and produces dangerous methane emissions.

The radical changes in Scottish Government policies on waste treatment in 2009 forced SBC's hand, and they realised their "do nothing" strategy - continuing to send tens of thousands of rubbish to landfill - would soon become untenable. At the time the council feared it could be liable for more than £14 million in Landfill Allowance Scheme (LAS) penalties unless a solution could be found.

Senior personnel at Newtown St Boswells were so intimidated by the impending Zero Waste targets being formulated by SNP ministers they sent a Borders delegation to Edinburgh to warn government officials it would be extremely difficult to meet the proposed changes both technically and from the financial viewpoint.

So where does the failure to even start work on the MBT leave the Borders in its efforts to meet landfill diversion targets and to comply with the national Zero Waste strategy six years down the line? The revised integrated treatment plan has yet to be published and for now the "do nothing" scenario persists. Extra costs are being incurred on a daily basis.

A contact in the waste treatment industry told us: "The variation in the contract with NES should never have been made, and it was completely unnecessary. There was scope within the agreement for the incinerator to be delivered within eight years of completion of the MBT, a time lag which would have allowed the NES thermal treatment technology to prove itself.

"Whoever recommended that change and those who sanctioned the decision not to proceed with the MBT on its own has already cost the council at least £20 million in savings if you compare the proposed facility with 'do nothing' It simply does not make sense, and someone needs to explain in detail why the contract variation of 2012 was agreed. It will cost many millions more to go out to tender again and go through the procurement and construction phases, and those costs  will not be recovered".

He said the only other possibility might be to transport all of the Borders waste to a treatment facility outside the region, an option which would be expensive and environmentally damaging. It is a waste management method given serious consideration a decade ago when councils in the Lothians and Borders were working on a combined initiative to treat refuse. But that also fell through.

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