ABERDEEN CITY COUNCIL. Lead Officer : Belinda Miller Head of Service Economic and Environmental Sustainability

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1 PAGE 1 ABERDEEN CITY COUNCIL Name of Committee : Full Council Date of Meeting : 13 February 2008 Title of Report : A Strategy for Transforming Waste Management Services 2008 to 2011 Lead Officer : Belinda Miller Head of Service Economic and Environmental Sustainability Author of Report : Peter Lawrence Strategic Contracts Manager Environmental Tel - (81)4629 plawrence@aberdeencity.gov.uk Other Involvement 1 : Stakeholder events took place during November, December 2007 and January Participants included front line staff, partners, unions, and Elected Members. Kath Beveridge, Corporate Director of Strategic Leadership Clare Neely, Waste Minimisation Officer Matt Bailey, Modernisation and Innovation Manager Joanne Morrison, Change Manager Henrietta Pallos, Change Manager Claire Hunter, Change Manager Hugh Murdoch, Head of Shelter and Environment, Neighbourhood North Area Peter Lawrence, Strategic Contracts Manager Angus Sefton, Waste Collection and Disposal Manager Jan Falconer, Strategist Environmental Sustainability Graham Walker, Waste Collection Manager Bill Nicol, Principal Accountant Scott Paterson, Accountant Brian Downie, Finance Manager Nigel Buchan, Acting Fleet Manager 1 Please see Appendix 2 Communications Audit which includes comments and responses to consultation.

2 PAGE 2 Consultation undertaken with : All Elected Members Waste Management Working Group Corporate Management Team, City Solicitor City Chamberlain Extended Corporate Management Team Service Managers working across Environment and Shelter, Strategists, Strategic Leadership Resources Management HR, Finance, Legal Continuous Improvement CRM, Service Design and Development, Trade Unions Aberdeenshire Council, Planning and Environmental Services Summary of Report It is imperative that Waste Management Services are transformed; landfill disposal costs are set to double in three years, recycling collection currently costs five times more than general waste collection and there are no facilities in Aberdeen to remedy this situation. This report outlines a programme for developing class-leading waste collection services that will minimise the increase in waste management costs whilst delivering commitments made in the Council s Vibrant, Dynamic and Forward Looking policy statement as well as addressing national policy and targets. The actions required to achieve our goals can be grouped into three related areas: Develop new infrastructure for waste transfer, recycling and composting funded through a variation of our Waste Management Contract Expand recycling services to all citizens of Aberdeen Overhaul collection methods to halve the cost of recycling and reduce the cost of refuse collection. These proposals are primarily focussed on delivery of outcomes within 3 years and will allow waste management services in Aberdeen to take a major step forward. To complete the transformation to a truly sustainable waste management service, a solution for landfill diversion of residual waste must be found as soon as possible. Failure to do this will result in Aberdeen rapidly falling behind other councils and will see a return to rapidly increasing costs associated with landfill beyond The key actions and estimated financial impact of the Transformation Strategy are shown in Appendix 11. This paper has been widely circulated and consulted. As a result of the current constraints, Trade Unions have indicated the need for more time to comment. Any comments and changes will be circulated in additional papers.

3 PAGE 3 Recommendations Council is requested to approve the package of detailed recommendations below. A number of these can be implemented independently in the short term and will deliver service improvements, however, the step-change transformation we are seeking to achieve requires the integrated adoption of all the recommendations. Many of the recommendations set future waste policy direction and will require further work before they are brought forward to appropriate Council committees for specific approval for implementation. 1. Transform Waste Management Infrastructure through the development of: 1.1. A mixed-materials Recycling Facility in Aberdeen with a capacity in excess of 30,000 tonnes per annum with facilities to include the ability to sort glass from other recyclables 1.2. Two new Recycling Centres in Aberdeen. One in the Bridge of Don area to replace the Perwinnes Moss Site. The second to be in the west of the city Two Transfer Stations in the city, one in the north and one in the south, one possibly co-located with the MRF 2. Vary the Waste Management Services Contract to develop the facilities outlined in Recommendation 1 and to: 2.1. Establish a long term arrangement for treatment of green and organic waste using either In-vessel composting or anaerobic digestion 2.2. Secure landfill capacity from 2010 until the introduction of residual treatment facility as determined by the Aberdeen City Waste Strategy currently under development 3. Transform the waste collection service in the short term through the following: 3.1. Introduce in 2008 a paper recycling service for areas served by street bulk bins and in courtyard and high-rise developments, including sheltered housing 3.2. Ensure the combined kitchen and garden waste service is introduced without delay 3.3. Enhance provision of trade paper recycling service through a review to include charging rates, containerisation and opportunities for expansion 3.4. Introduce alternate week collection of residual (black bin) waste across all areas served by wheeled bin by spring In conjunction with 3.4, establish clear policy on wheeled refuse bin replacement and provision of additional refuse bins based on an annual charge

4 PAGE Introduce recycling collection services to rural properties 3.7. Provide additional resource, on a short-term contract (one person for one year), to optimise existing round system to ensure efficient use of vehicles and to plan new route system for introduction of alternate week collection of residual waste 3.8. Develop a waste flow based data management system to assist in operational management and options analysis 4. Adopt Fleet Management measures to increase efficiency of waste collection services through: 4.1. Servicing of waste collection vehicles in evenings 4.2. Complete the transfer of workshops and staff from Duthie Park to Kittybrewster, in order to facilitate Update charging mechanism for vehicles to reflect actual costs 4.4. Implement, as a high priority, a waste collection fleet replacement programme to ensure maximum age of 9 years by 2009 and 7 years by As an immediate priority, establish additional vehicle storage capacity in the city 5. Upon the delivery of facilities identified in Recommendation 1, transform the waste collection service by: 5.1. Changing household recycling collection from kerbside sort to mixed recyclables collection 5.2. Changing multi-occupancy paper recycling service to mixed recyclables upon the opening of the MRF recommended above 5.3. Expanding food/catering waste collection services to schools and other council controlled premises 6. Develop long term waste management solutions through: 6.1. Investigation of joint procurement residual waste treatment facilities with Aberdeenshire Council (to include energy from waste as an option) and opportunities for common service delivery in other waste management areas. The Waste Management Services Contract will, therefore, not be varied to include residual waste treatment until this investigation has been completed Build upon new Local Plan policy on waste management to address specific issues such as major infrastructure and local recycling points through

5 PAGE 5 appropriate policy/guidance development 6.3. Undertake a best value service review of the waste collection services within an agreed timescale and proceed to market test all options, including contracting out, should the review not demonstrate best value 7. Transform financial management and support functions to improve efficiency of waste collection service through: 7.1. Simplifying waste management accounting system 7.2. Introduction of activity-based costing based on waste streams/collection methods 7.3. Review of administrative support requirements in relation to Waste Management Services Contract and management of trade waste charging in light of move to direct debit 7.4. Review requirement for waste awareness, education and promotion activities and identify most appropriate, cost-effective means of delivery Recommendations 1.1, 1.2, 1.3, 2.1, 2.2, 3.4, 3.6, 3.7, 4.4, 5.1, 5.2 and 5.6 will require further, detailed examination and specific, costed recommendations will be brought forward to appropriate Council committees for specific approval before implementation. Links to the Community Plan and to a Vibrant, Dynamic and Forward Looking Council This Report relates specifically to the delivery of the Council s waste management priorities contained in the Policy Statement, Vibrant, Dynamic and Forward Looking Council, our corporate objectives to integrate services and to deliver our Community Planning Challenges for Waste Management. Implementation On approval of the recommended options, Strategic Leadership and the Area Teams with the support of Continuous Improvement and other services will produce and implement action plans within agreed timescales. Once implemented, the process for monitoring the strategy will be via the corporate performance management system, including supervisory meetings, ECMT Performance Board; CMT Quarterly Review; Citistat; Area Committees, and ultimately the Continuous Improvement Committee. Where solutions are not delivering the required results, we will scrutinise the reasons and adjust our approach accordingly.

6 PAGE 6 Resource Implications People : Transformation of waste management services on the scale proposed will inevitably have impacts on staff within the Council. Infrastructure and residual waste jointprocurement with Aberdeenshire Council are activities that are currently undertaken in Aberdeen by NEM/SITA, our Waste Management Contractor and so will not directly affect Council employees. The proposed changes to collection methodologies will also have impacts on work patterns. Where there are reductions in service provision (e.g. reduced residual waste collection frequency), it is anticipated that this will be offset by additional recycling collection or by reduction on reliance on agency staff. The move from kerbside sort to wheeled bin collections will reduce manual handling issues for collection staff. Close communication with staff will be maintained from the earliest stages as these broad policies are taken into the implementation phases. Changes proposed in fleet management are largely based on agreements already reached including the centralisation of workshop activity at Kittybrewster and the opportunity to work evening shifts. Once again, there will be open communication with staff on the implementation of these recommendations. Two further reviews of administrative and promotional activities within the Waste Collection Service have been proposed and staff will be involved in this review from the earliest stages. No prior decision has been made on the outcomes of the review and Human Resources will be advising operational and strategic staff how all service changes will be managed. Finance : In face of annual increasing costs associated with existing service provision this Transformation Programme makes recommendations that will slow down this increase whilst achieving the Council s obligations and commitments. The interrelated actions identified are difficult to integrate and summarise financially, however, Appendix 11 shows the estimated costs associated with the recommendations. The Strategy assumes successful variation of the Waste Management Services Contract; if this is achieved NEM/SITA will make capital investment in infrastructure on

7 PAGE 7 the Council s behalf, limiting capital spend by the Council to approx. 1 million in vehicle procurement and lower costs for container purchases. It should be noted that this will be mitigated by the disposal of redundant vehicles as a result of the change in collection methods. In 2010/11 landfill disposal costs will be a minimum of 3.1 million and a maximum of 7.4 million more expensive than 2007/8 if there is no change to the service. On top of this will be an estimated 1 million additional cost in charges by the landfill operator. By implementing the full range of changes proposed refuse and recycling collection costs will be reduced by an estimated 2 million in Recycling processing costs will increase by 540k and landfill disposal charges will increase by 2.74 million. Kitchen and garden waste treatment will reduce by 120K. The net increase in charges against 2008/9 costs is estimated to be 1.16 million in 2010/2011, approximately 2 million less than the no change scenario, although it is stressed that assumptions on a number of variables have been made to reach this figure. Further work is required to more accurately quantify the savings achieved by the programme, however, it is clear that the integrated programme of action will deliver significant financial benefits to the Council whilst achieving its waste management goals. Systems & Technology : No major implications are apparent within this report. A waste data flow management system is recommended, however, it is anticipated that this can be developed on existing Excel software. Property : Additional Infrastructure capacity is required and the preferred solution will utilise land in the Council s ownership as a means of minimising cost. Specific requirements will be determined through the implementation of this plan and assistance from relevant officers in Asset Management

8 PAGE 8 Other Equipment : New waste collection services will require additional vehicles and containers and this will be procured through the appropriate methods. In addition, major plant will be required for recycling and composting processing; this will be subject to variation of the Waste Management Services Contract with NEM/SITA Other : None arising from this report. Other Implications Health & Safety : All service changes will be subject to Health and Safety Risk Assessments Risk Management : The risk of not proceeding with these recommendations will be that waste management services become unaffordable, and the Council will not achieve Best Value. There is also a risk that the Waste Management Services Contract will not be able to be satisfactorily varied, resulting in Contract Termination with attendant costs, including new procurement of services. This risk, whilst significant is not assessed to be high. The services to be provided under this plan are compatible with the existing contract and it is not felt that there is any procurement risk. The main area of risk is associated with negotiating a suitable price for the services. Human Rights/ Equalities/Diversity : The completed Aberdeen City Waste Strategy will include an Equalities Impact Assessment. Sustainability : The completed Aberdeen City Waste Strategy will include a Strategic Environment Assessment. This strategy contributes to sustainability by diverting waste from landfill. Environmental : The Transformation Programme will deliver significant improvements in the environmental impact of waste management in Aberdeen. Social : Additional recycling and composting facilities for more householders in Aberdeen will allow citizens to contribute to the improvement of Aberdeen.

9 PAGE 9 Economic : The Transformation Programme will increase the range of recycling activities in the city and the development of new facilities through the Waste Management Services contract. Estimated at a value of 4-7 million, this will benefit the construction sector and engineering consultancy, mostly within Aberdeen. Increased collection of recyclables will increase the opportunity to develop local or regional reprocessing facilities, however, it is recognised that at this time cost-effective reprocessing can only be achieved through large scale facilities. The distance from the major sources of recyclables in the UK disadvantages Aberdeen and as such the likelihood of economic impact from this sector will be limited. The development of a residual waste treatment technology is expected to cost in the region of million with a significant proportion directly benefiting the local economy. Construction : New facilities will be developed, under the Waste Management Services Contract with NEM/SITA. Signature :

10 PAGE Main Considerations INDEX 1 Why a transformation strategy for Waste Management Serices Methodology National Legislative Context National Policy Context Local Policy Context Overview of Services Provided in Aberdeen Analysis of Current Performance Current and Projected Service trends Strategic Objectives and Recommendations Appendices... 1 WHY A TRANSFORMATION STRATEGY FOR WASTE MANAGEMENT SERVICES? 1.1 The past decade has seen major changes in the organisation and operation of Public Sector services in Scotland. Following the move to unitary authorities in April 1996, the UK government in 1997 suspended the statutory requirement for Compulsory Competitive Tendering (CCT) and replaced it with an expectation of the achievement of Best Value (BV). With the implementation of the Local Government (Scotland) Act 2003 came the formalisation of BV as a statutory requirement and an increased drive towards modernisation and efficiency against the background of decreasing funds. Alongside this, the implementation of the National Agreement of Single Status and Equal Pay is taking place and creating further financial demands on local authorities as well as a need to modernise terms and conditions. Since its inception, Aberdeen City Council has embraced the transformation agenda, and this determination was explicit in the very first policy statement in 1996, which included a commitment to streamline service delivery. 1.2 This transformation strategy for Waste Management Services has been developed to set out an evidence-based programme for improving Aberdeen City Council services over the next 3-5 years. In addition, the case for residual waste treatment to 2020 and beyond is considered. The strategy follows relevant Scottish guidance, and seeks to ensure that the Council keeps pace with emerging and established local and regional policy as well as the City s Community Plan. It is our intention through the successful delivery of this strategy to meet and preferably exceed all minimum legislative and environmental requirements. Overall, this strategy focuses on issues specific to Aberdeen City Council, whilst also being aware of the wider context and the inter-relationships that exist with our partners in the City and beyond. 1.3 Aberdeen City Council has set the bold and aspirational vision to be recognised as a leading Council in Northern Europe by To achieve this vision the Council have to deliver the best possible outcomes for the citizens of Aberdeen and ensure we have the internal capacity to deliver against ever-rising citizen expectations. We also need to provide all staff with strategic leadership to enable them to deliver effective and efficient services. We will do this by implementing a transformation strategy that aims to meets the targets set by the Council in the Vibrant, Dynamic and Forward Looking policy statement.

11 PAGE Areas of the service are significantly overspent in comparison to Grant Aided Expenditure (GAE) 2 and other areas of funding. In addition, spending on waste is set to increase markedly in the next three years as a result of legislative and policy decisions at European, UK and Scottish levels. This strategy aims to reduce budget spend where possible, taking account of GAE, whilst increasing performance it is a strategy that seeks to deliver better outcomes while minimising the impact on budgets and spending in the 3-5 year time span. 1.5 The strategy will provide direction for the considerable amount of work still required to transform our infrastructure and services to meet and exceed challenging targets set by the Scottish Government and this council. 1.6 This strategy will also provide a framework for operational delivery which must be supplemented at the earliest opportunity with detailed Implementation Plans developed and supported by all elements within the Council. It should be made clear, however, that this strategy does not address in detail the wider waste management challenge facing the authority, in particular the need to address the management of residual waste, or that waste that is left over after recycling and composting activities has been completed. This will be the main thrust of the developing Aberdeen City Council Waste Strategy that is being developed parallel to this Transformation Programme. 2 METHODOLOGY 2.1 In preparing this Transformation Strategy for the Council s Waste Management Services, Strategic Leadership has worked with colleagues in other teams in the Council and endeavoured to balance consultation and analysis. This work has been undertaken at speed to tight time frames with a degree of practicality so we can begin to implement and address the critical issues we face. 2.2 Appendix 9 shows the timetables and methodology used in the Programme 2.3 Desk based research focussed on the expectations of the services and their own requirements. The key guiding questions that focussed this element of the process were: What services do we statutorily need to provide? What services are required by Council policies to provide? What services do we currently provide that are outwith our remit? What services are we meant to provide that are not currently being offered? Of the services we are providing, how are they delivered? How much do/could these services cost to run? What can be done to improve these services? 2.4 Through this process a view of the international, national, regional, and local legislative and policy contexts were developed for each area. This includes detailed knowledge of the statutory obligations and aspirations directly associated with the services under review. 2 GAE is the means by which the Scottish Executive distributes the total budget it has available for Scotland s local authorities. It is not and does not attempt to identify the level of expenditure expected for each area of services.

12 PAGE Performance information, including benchmarking with other local authorities, was also gathered to assist in identifying any shortfalls in performance and expectations both at a national and local level. Details of these are provided within this report. 3 NATIONAL LEGISLATIVE CONTEXT 3.1 At the highest level, the strategy seeks to ensure that the services the Council delivers fit with the requirements of the Local Government in Scotland Act (2003). This Act gave community planning a legislative basis; established the power to advance community well being and partnership working; and secured a duty of best value including having regard to economy, efficiency and effectiveness. In order to ensure we meet our statutory duty under The Local Government Act to deliver Best Value, this strategy recognises that Waste Management Services are becoming increasingly complex and that delivery solutions should be focussed on ensuring efficiency whilst recognising and incorporating the need for integration with neighbourhoods within the city. We also recognise that all employees and stakeholders must be empowered to contribute to delivering high performing services. We already have examples of dedication, innovation and energy from individuals and teams in the waste management and fleet services and throughout the Council. We are now developing a culture where the best can help support and raise the performance of the rest. The Local Government Act also places a duty on Councils to deliver best value in a way which contributes to the achievement of sustainable development (including physical, economic and social aspects). This strategy has been developed within this context, and aims to support and promote sustainable development within Aberdeen City and the wider region. 3.2 The Environmental Protection Act (1990) places an obligation upon Local Authorities to make adequate arrangements for the collection of waste from households, largely free of charge at the point of collection. The Act also requires Local Authorities to make arrangements for the collection of waste from business premises if asked to do so by the business. The Local Authority is able to recover reasonable costs for providing the service. A Local Authority is able to fulfil its obligations under the Act either by providing the service itself or by contracting the service out. All Local Authorities in Scotland provide collections from households through their own waste management services, however, elsewhere in the UK many (greater than 30%) Local Authorities have contracted this service out to the private sector. 3.3 The European Union Landfill Directive (1995) represents a step change in the way waste is disposed of in Scotland and will help drive waste management up the waste management hierarchy through waste minimisation and increased levels of recycling and recovery. The Directive s overall aim is to prevent or reduce as far as possible negative effects on the environment, in particular the pollution of surface water, groundwater, soil and air, and on the global environment, including the greenhouse effect, as well as any resulting risk to human health, from the landfilling of waste, during the whole lifecycle of the landfill. The Directive has provisions covering location of landfills, and technical and engineering requirements for aspects such as water control and leachate management, protection of soil and water and methane emissions control but it is the establishment of limits on the amount of waste that may be landfilled that will have the significant impact on the Council. The Directive sets demanding targets to reduce the amount of biodegradable municipal waste landfilled. These targets are:

13 PAGE 13 By 2010 to reduce biodegradable municipal waste landfilled to 75% of that produced in 1995 By 2013 to reduce biodegradable municipal waste landfilled to 50% of that produced in 1995 By 2020 to reduce biodegradable municipal waste landfilled to 35% of that produced in These dates include a 4-year derogation from the original target years 2006, 2009 and 2016 offered in the Directive to Member States who landfilled more than 80% of their municipal waste in The UK has adopted this for the first two targets years, and will decide whether to do so for the final target year of 2016 nearer the time. 3.4 The Landfill Directive has been transposed into UK Law through the Waste and Emissions Trading Act 2003 and then subsequently in Scotland through a number of Regulations, the most relevant being the Landfill Allowance Scheme (Scotland) Regulations These Regulations place obligations on individual Local Authorities to comply with the targets set out in the Landfill Directive. The mechanism to be used to achieve compliance is the Landfill Allowance Scheme (LAS). The Scheme established the 1995 baseline landfill tonnage for each Local Authority and, therefore, the limit, or allowance, of tonnage that is authorised to go to landfill in the first Directive Target year of 2009/10 in accordance with targets set out above. In addition, the Regulation set limits for years to 2009/10 that decreased linearly from 2001/2 performance to Appendix 1 identifies Aberdeen City Council s Allowances and projects these forward to the final Target Year of 2019/20. Failure to comply with the limits set under the Scheme renders the Council liable to a penalty levied by the Scottish Government of 50 per tonne of Biodegradable Municipal Waste in 2007/8 rising to 150 per tonne from 2008/9 onwards. The Scottish Government has discretionary power in this matter and may choose to waive the penalty or reduce its value; from 1 April 2008, Local Authorities will also be able to trade Landfill Allowances, as is currently the case in England. The value of the Allowances will be driven by the ability of Local Authorities to achieve their diversion targets and is therefore, subject to many external factors (availability of funding, ability to procure services and planning being significant but by no means comprehensive). Anticipating the value of allowances in future years is difficult, if not impossible, to predict but it is clear than many authorities are concerned about their capacity to achieve targets post-2010 and this suggests that the value of allowances is likely to increase in future years. Accordingly, future projections of the cost of purchasing allowances should not be based on current levels but, in order to identify the risk cost to the Council of penalties Figures 1 to 4 have been provided in Section 8. Table 1 summarises the increased costs from landfill tax and LAS Penalties if service delivery does not change.

14 PAGE 14 Table 1. Costs of Landfill Tax and LAS Penalties on Current Projections Year Landfill Tax increase (v 2006/7) ( million) Landfill Tax and LAS Penalties (v 2006/7) ( million) 2008/ / / NATIONAL POLICY CONTEXT 4.1 On May 3 rd 2007 the Scottish National Party were elected to government. Since the establishment of the SNP Administration the Scottish Government has been reviewing its waste policies. In a policy statement made on 24 January 2008, Cabinet Secretary Richard Lochhead outlined policy for Scotland to move towards a Zero Waste Society. There is no clear definition of this concept, although the Cabinet Secretary said Zero Waste is about the zero misuse of resource. The major targets are set out in the statement shown in Table 2: Table 2. Scottish Government Proposed Waste Management Targets Year % Recycling % EfW % Landfill The Cabinet Secretary indicated that these and other proposals in the statement will be subject to consultation and no further detail is available at this stage to fully understand the implications for Aberdeen City Council. The Transformation Programme is designed to deliver change over the period to 2011, and in this respect the focus of our activity will be on achieving 40% recycling, which is compatible with the Council s own target. As a result, this strategy has been developed broadly on the basis of existing policy, as outlined below, but with known policy positions taken into account where sufficient detail is available. 4.3 National Waste Strategy and National and Area Waste Plans. A duty placed upon the Scottish Executive as a result of the Landfill Directive was to develop and publish a National Waste Strategy and Plan that would demonstrate how the nation would achieve compliance with the landfill diversion targets set out in the Directive. In 2001, the Scottish Executive instructed Local Authorities, through 11 Area Waste Groups to develop regional plans to achieve the diversion targets. The Scottish Environment Protection Agency (SEPA) was tasked with coordinating the work of these Groups and to provide consistency of approach across the groups. The Northeast Waste Strategy Area Group covering Aberdeen City, Aberdeenshire and Moray produced its Area Waste Plan in The Best Practicable Environmental Option (BPEO) developed through the plan is shown in Appendix 2. The BPEO included a range of solutions including reducing waste production, recycling, composting, energy from waste and landfill. The 11 Area

15 PAGE 15 Waste Plans were incorporated by the Scottish Executive and in turn became the National Waste Plan. The National Waste Plan will now be reviewed and/or replaced by a National Waste Management Plan, although this is not expected to be complete until early 2009; furthermore it is not clear what mechanisms will be put in place to deliver the outcomes of the plan. 4.4 Strategic Waste Fund. The Strategic Waste Fund (SWF) was a specific grant scheme set up to assist Local Authorities in achieving the aims of the National Waste Strategy. Funding was allocated to all 32 Local Authorities to implement recycling and composting schemes (this became known as Phase 1). In 2006/7, the value of this fund to Aberdeen City Council was approximately 1.5 million. In 2005, the Scottish Executive turned its focus on Phase 2 or the residual treatment element of the National Waste Plan. The preferred means of implementing Phase 2 was to further amalgamate Area Waste Groups to form 7 Options Review Groups. These groups were tasked with developing Strategic Outline Cases prior to developing Outline Business Cases upon which the Scottish Executive would make spending decisions. This spending would be in the form of capital and revenue funding of Public Private Partnership contracts. In the Budget Statement for 2008/9, the Scottish Government announced the cessation of the SWF and amalgamation of any ear-marked funds into the GAE for each authority. 4.6 Zero Waste Fund. The Scottish Government has announced the formation of a Zero Waste Fund. Funding in the region of 50 million per annum until 2010/11 has been announced, however, how much, if any, will be available for Local Authorities is unclear. Equally, the funding mechanism preferred for major projects is also uncertain. This uncertainty will contribute to a widespread feeling amongst Local Authority Waste Managers that support from the Scottish Government for residual waste management will be some years away, especially for smaller groupings of authorities such as Aberdeen and Aberdeenshire. 4.7 Landfill Tax. UK Government introduced the Landfill Tax in 1996 as a means to encourage the diversion of waste from landfill. The tax applies to two categories of waste: active and inactive. Household and most municipal waste falls within the active bracket. Initially the tax was set at levels that did not influence waste policy significantly. In recent years, the UK Treasury established an escalator which increases Landfill Tax annually. In 2007/8 the tax is set at 24/tonne of waste landfilled, however, over the next three years this doubles to 48/tonne. 5 LOCAL POLICY CONTEXT 5.1 Waste Management Services Contract. In July 2000, Aberdeen City Council signed a 25-year Contract with NEM/SITA for waste management services. The Contract Tender was based upon the existing Aberdeen City Waste Strategy (1998 version) and comprised the following main elements in two phases: Phase 1 o Operation of two Transfer Stations in Aberdeen o Operation of 4 Recycling Centres in Aberdeen o Construction of East Tullos Recycling Centre o Operation and Closure of Hill of Tramaud Landfill Site Phase 2

16 PAGE 16 o Development of Altens Environment Park, comprising a Materials Recovery Facility (MRF) and an Energy-from-Waste (EfW) facility The main targets under the Contract were as follows: To Recycle a minimum of 25% of household waste by the end of 2005 To Recover 40% of Relevant Waste by the end of 2005 To reduce the proportion of waste going to landfill by 40% by the end of 2005 To introduce composting of organic Relevant Waste by the end of 2001 To implement the recovery of Energy from Waste by direct combustion by the end of As a result of failure to achieve planning permission for the Altens Environmental Park, the contract remains operating under the terms of Phase 1 whilst the parties attempt to identify a means of variation that allows the development of new facilities. This process has been delayed by the lack of a clear understanding of how the Council wishes to proceed. This Transformation Programme identifies a means to resolve this delay and provides a basis for variation of the Contract which allows the Council to implement systems that will achieve its target of 40% recycling by Aberdeen City Waste Strategy. The current city waste strategy was published in The main elements of the Strategy are included as Appendix 3. The Strategy broadly reflects the Waste Management Services Contract goals and, as a result, has not been fully implemented following the refusal of planning permission for the Altens Environmental Park. In parallel with this Transformation Programme, Strategic Leadership, in junction with colleagues within the Council and in consultation with other key stakeholders, is currently developing a new Aberdeen City Waste Strategy. This will build upon the recommendations of the Transformation Programme, which focuses on collection, recycling and composting of waste and also identify a solution to residual waste diversion from landfill. 5.4 Vibrant, Dynamic and Forward Looking is the partnership agreement between the two parties forming the current Council administration. The Agreement establishes a series of policies and targets for implementation between 2007 and The elements that relate to waste management services are as follows: Minimise the impact of council activities on the environment, including a target of being carbon neutral overall by 2020 and a commitment that all new council developments will be carbon neutral Adopt ambitious targets for recycling and composting, including a target of 40% of household waste being recycled by 2011 Introduce at an early date the collection of recyclables from tenements, extend the network of bring sites, extend the range of material which are collected for recycling and improve recycling services for small business Continue to oppose the disposal of Aberdeen s waste by incineration The Transformation Programme for Waste Management Services addresses these commitments. 5.4 Joint Working with Aberdeenshire Council. Aberdeen City Council and our colleagues in Aberdeenshire have been working closely together on waste management services since 2000 when the Area Waste Group was established. In recent times, work has focussed on the development of a Strategic Outline Case for the management of residual

17 PAGE 17 waste. It is this Council s aim to enhance working relationships and develop joint solutions where it is in the best interests of both authorities and officers are working on this basis. 6 OVERVIEW OF SERVICES PROVIDED IN ABERDEEN 6.1 Since the late 1990s waste management in Aberdeen has become increasingly sophisticated as the Council has moved away from black bag collection of waste with landfill as the disposal point for over 95% of the city s waste to containerisation provided to many householders in four separate forms (refuse wheeled bin, garden waste wheeled bin, recyclable containers box and paper/cardboard bag). The following summarises the waste collection services now provided by the Council. 6.2 Household Waste Collection Service Wheeled Bin Refuse Collection (71,122 households) Street Bulk Bin Collection (approx. 37,800 households) Special Trade Collections for bulky items (approx. 70 per week) Free bulky items Collections (approx, 540 per week) Kerbside Sort Dry Recycling (approx. 74,948 households) Paper Salvage Collection (approx. 6,000 households) Recycling Points (49 locations) Garden Waste Collection (approx. 61,560 households) Urquhart Road on-street paper recycling service (approx. 1,300 households) Provision of advice and education on waste awareness, including corporate contact centre Note that the Salvage collection refers the hand loading of loose paper left at the kerbside by householders. This service is a remnant of a old collection methodology that has been retained in city centre areas where it is impractical to introduce the kerbside sort system. 6.3 Trade Waste Collection Services Trade Waste Collection, including schools and other Council properties (approx. 2,500 customers) Trade Glass Collection (approx. 140 customers) Trade Salvage Paper and Cardboard Collection (approx. 400 customers) Trade Wheeled Bin Paper Collection (approx. 50 customers) 6.4 Fleet/Workshops. Aberdeen City and Aberdeenshire Councils have a joint procurement agreement for new vehicles, which includes the purchase of waste collection vehicles. This procurement agreement is intended to deliver stronger bargaining power and therefore lower prices for vehicles. Fleet maintenance is operated by the individual authorities, however, with most of Aberdeen Council s vehicles being serviced and maintained at the Kittybrewster depot. Appendix 10 identifies the current fleet used for waste collection and the identified fleet replacement requirement for the next three years, which will bring the maximum age of the fleet in line with industry standard and that of Aberdeenshire Council. Servicing and maintenance is mostly undertaken during daytime hours. In addition to the Kittybrewster depot, Aberdeen City Council has another smaller workshop at Duthie Park. Fleet charging is primarily

18 PAGE 18 based on standard charges for each type of vehicle, which covers all costs except fuel, accidental damage or driver/crew abuse. Replacement of vehicles during servicing and/or maintenance is not covered in the charging agreement and the responsibility for provision of replacements is with the vehicle user, not fleet management. There exists a Shared Services Project investigating the benefits of further developing joint facilities with Aberdeenshire for the operation and maintenance of vehicles. This review is independent of that process, which is expected to report in coming months. 6.5 Waste Treatment/Disposal Facilities. The Waste Management Services Contract with NEM/SITA makes provision for the management of these services. As outlined above, the Contract is still in Phase 1, albeit as a result of the delay in delivery of Phase 2. The services provided by NEM/SITA are outlined below: Use of Shanks Waste Solutions Transfer Station in East Tullos; the SITA/ACC Transfer Station in East Tullos is closed because of unsafe buildings. Transfer/Recycling Station at Sclattie, Bankhead, including bulking facilities for garden waste, three colours of glass and paper, and sorting facilities for mixed steel and aluminium cans and plastic bottles Four Recycling Centres (also known as Civic Amenity Sites) Hill of Tramaud Landfill (operational) Ness and Tullos Hill Landfill (closed site) Arrangements for: o Landfill alternatives o Green Waste Composting (currently contracted to Keenan Recycling) o Markets for Recyclate o Markets for other materials (Refrigeration equipment and other hazardous wastes) 7 ANALYSIS OF CURRENT PERFORMANCE AND BENCHMARKING 7.1 Waste Growth. The amount of waste produced per head of population and per household has increased on an annual basis across Scotland and the UK for decades. This pattern has been reflected in Aberdeen; most observers agree that the rate of increase has, in the past, linked to economic growth and therefore in areas with successful economies rates of growth are higher than average. The success of the city of Aberdeen has placed pressure on the rate if growth of waste; this has been countered to a degree by population changes in the region. As a result of the small geographical area of Aberdeen, there has been a trend for people to move to Aberdeenshire where there has been increased housing provision, often at more affordable rates. A further complicating factor is the reduction in average household size; the combination of an aging population and the development of substantial numbers of flats and apartments in the city which has led to fewer people living together. Research demonstrates that the amount of waste produced per person is higher in smaller households. The net effect is that Aberdeen s waste arisings have increased by 4.6% in 2006/7 despite the efforts of the Waste Aware Team (see Appendix 4). Waste minimisation is an important area of public policy and a key element of waste strategies in the UK. It should be recognised, however, that the most effective means of reducing waste growth and in turn reducing waste production is to manage resource use at the point of production, not the point of use. In effect, this means that national and international legislation and commitments are required to reduce resource consumption, extend product life and reduce packaging of produced goods. In light of this analysis, the role that local waste reduction initiatives can have within our community must be

19 PAGE 19 recognised as being limited. It is important, however, that awareness and education remain an element of the service provision. 7.2 Recycling. Aberdeen City Council has seen a significant increase in the quantity of waste recycled over the last four years. With the support of significant funding from the Scottish Executive, large areas of the city have been provided with kerbside recycling facilities and an increase in the number and range of Recycling Points. In the full year, 2006/7 Aberdeen City Council recycled 21.5% of its waste, although this figure has now increased to nearly 25%. Recycling performance is affected by a wide range of factors which must be considered when attempting to compare Local Authorities performances (see Section 6). There are factors that are largely outwith the control of Local Authority Waste Management Services, and these are considered below: 7.3 Housing density and household size. Public participation in recycling is shown to be most successful when householders are provided with separate containers for storing recyclables and collections are made from the front of their premises (CIWM Recycling Collection Best Practice Guide, 2006). Accordingly, participation, and therefore recovery rates, is lower in areas where it is not possible to provide householders with containers and/or collect from the doorstep. This applies largely to multi-occupancy premises, where property size is often small leading to lack of space for separate containers and where collection from the doorstep is impractical and costly. As a result, authorities with large numbers of multi-occupancy properties or large areas of high housing density will find it much more difficult to achieve high recycling rates. In Scotland, this is reflected in lower recycling performance in densely populated authorities such as Aberdeen City and Glasgow. This reality has been recognised by the Scottish Executive: in setting its recycling targets for 2020, the Scottish Executive set lower targets for urban authorities including Aberdeen than for the rest of Scotland (45% versus a Scottish average of 50%). 7.4 Socio-economic bias within the population. Whilst this factor is open to significant variation within communities, there is a broad correlation between socio-economic grouping and participation in recycling activities. A degree of this linkage may reflect the type of housing used by these groups as reflected in the analysis above. Notwithstanding this influence, evidence demonstrates that those less-advantaged in society participate less in recycling activities. Appendix 5 shows the results of participation surveys undertaken within areas of Aberdeen covered by the kerbside collection service and it is evident that whilst this is a snapshot and routes often have a mixture of socio-economic groupings participation is lower in less affluent areas. 7.5 Cost-effective access to recycling markets. Large scale reprocessing facilities for recyclate are largely to be found in England or abroad. This is the result of the need to construct large facilities to obtain economies of scale and therefore be as close as possible to the largest sources of recyclate. Transport of recyclate is increasingly costly and will inevitably impact on the cost of recycling. Aberdeen is geographically poorly placed to compete with other authorities in gaining access to recyclate markets with the closest major reprocessing plant for any recyclate being 120 miles away at Alloa (glass). This issue is mitigated for by Aberdeen City Council, however, by having in place a waste management contractor (NEM/SITA) that has access to many UK and worldwide markets, has significant market influence and can often negotiate national prices, including transport, for recyclate that benefits Aberdeen. 7.6 Direct charging for waste services. At present, householders pay for their waste and recycling collection services through their Council Tax. The element relating to

20 PAGE 20 waste management is not separately identified within their bill and is small in comparison with the total bill. As a result, there is little public awareness of increasing waste disposal charges or, indeed, any incentive to change behaviour and maximise their reduction, reuse and recycling of waste. Variable charging schemes that are transparent to the householder are used in many parts of Europe and they have clearly affected awareness of waste and changed householder behaviour. Typically, charging schemes offer lower collection rates for recyclate than general waste. In Scotland, it is not currently possible under current legislation for Local Authorities to introduce direct charging for waste collection. There are a number of factors within the control of Local Authorities that can have a significant effect on the success of recycling activities: 7.7 Choice of Collection systems. The method of containerisation can have a significant effect of the levels of participation and presentation of recyclate. Simplicity is seen as a major key to success. Keeping the range of collections as small as possible and the number containers (bags/boxes/wheeled bins) as low as possible will also lead to higher participation. The predominant system in use in Aberdeen is the kerbside box and bag service. This system has the following advantages Relatively small volume of box container making storage within the home, and kerbside presentation easier Bag for paper is easily stowed when not in use Both are easily transported to the kerbside Complementary with Kerbside sorting vehicles The system also has disadvantages Bag for Paper blows away when empty and left at kerbside Box is not big enough for fortnightly collection, especially where plastic bottles are common Kerbside sorting is slow and therefore costly The major alternative to the system currently in use is for householders to be provided with a wheeled bin for the collection of mixed recyclables. These systems require sorting to take place after the vehicle has been unloaded; the infrastructure for this system is not in place in Aberdeen. 7.8 Frequency of Collection. Greater opportunity for recycling through more frequent collection can assist in increasing participation rates, however, the greatest success of changing frequency has been seen when residual waste collection frequency is reduced in response to increased recycling provision. The Dyce pilot is evidence of this where customer satisfaction remains high despite the two-weekly collection of residual waste. 7.9 Extent (coverage) of Collection systems. Providing as widespread a kerbside service as possible will increase recycling rates. In the absence of kerbside collection, a dense network of street recycling containers and Recycling Points is the next best step. Currently, over 74,900 households have a kerbside service and there are 49 Recycling Points, plus there is a limited paper salvage collection service in parts of the city not