Government rules on public sector financial risk have prevented an arms length management organisation from bidding for a second waste site under a Private Finance Initiative (PFI) bid. The company, Norfolk Environmental Waste Services (NEWS) is preferred bidder for Norfolk County Councils Contract A, to build an up to 200,000 tonnes a year mechanical biological treatment and an anaerobic digestion plant.
However, the council has said NEWS bid for a second site, called contract B, will not be able to continue under the PFI bid, worth £137 million PFI credits, because it would expose the council to too much risk.
A spokesman for the county council explained: PFI is about transfer of risk to the private sector, so if the county council took the second contract it wouldnt be able to take the PFI route because there would be no transfer of risk. So they havent been able to bid. Some members of the council have raised issue with this.
Council members have time to challenge the decision to prevent NEWS bid as tenders for the second site will be invited in October 2008. A member of the waste services team added: The technology and preferred bidder issue is not static, its on the move.