Copied from Local Government Chronicle online
13 August, 2014 | By Corin Williams

Districts in Lancashire are challenging the county council’s plans to change the funding system for waste collection in a way they say could cost them hundreds of thousands of pounds.

Lancashire CC has said it will no longer fund district councils for each household they supply with a kerbside recycling collection after the present agreement, which began in 2004, runs out in 2018.

Districts will instead be paid by recycling credits issued for the tonnages of recyclable materials they collect.

Wyre BC leader Peter Gibson (Con) has warned his council would face a revenue reduction of more than £980,000, equivalent to a 15% increase in council tax, as a result of this change.

He said in a report to a council meeting that recycling credits were an unreliable payment method as “districts couldn’t predict what their recycling levels would be and this made financial planning more difficult”.

Eleven districts are involved in the existing deal with Lancashire, the exception being Ribble Valley BC.

A Lancashire spokesman told LGC’s sister title Materials Recycling World: “The county council has made the waste collection authorities aware that it is considered highly unlikely that these agreements will be further extended once they expire in 2018 in order to ensure that they have sufficient time to plan their financial strategies beyond this date.”

This story could just as easily be about Lincolnshire County Council and its treatment of Lincolnshire district councils – but worse!

Each Lincolnshire district council already pays for its recycling collection service and only get recycling credits from LCC. The county are now stopping the payment of recycling credits AND taking over the disposal contract, so that they collect the revenue that is currently paid by the contractors.
Revenue from recycling is never a certainty and depends on a global market so, to be fair, the county council is at least taking on that risk. However, as the world recovers from the financial crisis, the risk becomes significantly lower.
This move by LCC, is a financial double whammy for South Holland and two other Lincolnshire district councils. Out taxpayers will still have to pay to collect recycling, but now the cost will not be offset, in part at least, by the payment of recycling credits, or revenue from the contract.