Somerset taxpayers may soon face the prospect of increased costs for waste collection services as the current contractor, Suez, grapples with financial challenges. The company, responsible for all kerbside collections in the region, including recycling, refuse, food, and garden waste, has indicated the possibility of exiting the contract unless payments are raised.
Despite the annual revenue of £24m from the contract, Suez has reported substantial financial losses, prompting concerns about the continuation of services. Somerset Council, which took over the contract in April 2023, has committed to negotiating a new deal with Suez to prevent any disruptions to the regular waste collections.
Various factors, such as the impact of the pandemic, a national driver shortage, rising staff costs, and decreased revenue from recycled materials, have contributed to the challenges faced by Suez during the early years of the contract. Disputes over payments have further complicated the situation, with the company potentially looking to terminate the contract unless a viable settlement is reached.
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To address this issue, the council plans to engage in negotiations with Suez to minimize the impact on taxpayers while ensuring the continuity of waste collection services. However, exploring alternative options such as re-procuring the contract with another company or establishing a local authority trading company could result in additional costs compared to the current arrangement.
The council remains focused on finding a resolution that mitigates the financial burden and avoids disruptions to this essential service. The decision on the proposed course of action will be considered by the executive later in the year, with a commitment to safeguarding the operations of household waste recycling centers, operated separately by Biffa.