Agenda item

          The Sub-Committee considered a report which set out the implications of the Landfill Allowances and Trading Scheme (LATS) on the Council, and the Authority’s current and predicted LATS position until 2013/14.

          At a previous meeting of the Sub-Committee it was resolved that delegated powers to trade for Landfill Allowances were given to the Operational Director, Financial Services, in consultation with the Strategic Director, Environment and the Portfolio holders for Environment, Leisure and Sport and Corporate Services, and that authority be granted to purchase or sell LATS permits, provided that the sum value of all such transactions (disregarding whether purchases or sales) in any financial years did not exceed £100,000 and subject to adequate budgetary provision having been made (Minute ES54/2006).

          The Sub-Committee was advised that estimates indicated that the financial requirement for future years exceeded the value in the previous resolution. Therefore, additional approvals were now required for future purchases.

          In order to avoid future potential fines, Halton could now purchase landfill allowances to cover predicted shortfalls for the year 2010/11 onwards. Based upon current market offers following a request for three written quotations, allowances were currently available at £9 per tonne for 2010/11 and 2011/12 and £10.80 for 2012/13 if purchased in advance. Alternatively, payment could be made each April at these prices plus an RPI increase for each year.

          Currently, allowances were not available for 2013/14 due to internal approvals not being available until 2010, therefore the figures shown for 2013/14 were estimates. This offer also provided flexibility with the options of immediate purchase or spreading costs over several years.

          Members were advised that only one other quotation was received from another authority that were working to an indicative price level of £13.50 for 2010/11 and 2011/12 rising to £17.50 for 2012/13 and 2013/14.

          It was noted that it was DEFRA’s view that if landfill allowances were traded for cash, public procurement rules were not engaged because there was no acquisition of supplies or services. Although it was DEFRA’s view that it would not be necessary for the Council to go out to tender for the purchase of allowances, in order to deal with the implications of the Council’s Standing Orders, the Sub Committee was requested to consider waiver of Standing Order 3.1, which required that three competitive tenders be sought for contracts between £50k and £1m.

          Whilst there was no certainty about future prices, which might go up or down, it was believed that the current offer represented good value for money and it was recommended that the Council now secure contractual arrangements for the purchase LATS permits for the period 2010/11 to 2013/14.

          RESOLVED: That for the purposes of LATS, the Operational Director – Financial Services, in consultation with the Strategic Director – Environmental and the Portfolio Holders for Environment, Leisure and Sport and Corporate Services, be authorised to;

          (1) secure contractual arrangements with other local authorities for the purchasing of permits to enable Halton to meets LATS  targets; and

          (2) trade up to the value of £125,000 for 2011/12, £175,000 for 2012/2013 and up to £250,000 for 2013/2014 subject to budgetary provision;

          (3) Procurement Standing Order 3.1 be waived for the purposes of the exercise of the delegated power; and

          (4) further reports be received on LATS as necessary.