The London Borough of Tower Hamlets is to take its waste collection, recycling and street cleansing service in-house from April 2020.
The contract with Veolia ends then and the council has decided not to seek new bids.
Tower Hamlets’ population is projected to increase by almost 60,000 in the next decade to 370,000, almost twice as fast as the London average, bringing another 30,000 households and increasing pressure to improve recycling and reduce waste.
Elected mayor John Biggs said: “This marks the first step in the council’s move towards the delivery of an improved service. It follows on from our recent waste consultation, which generated a huge range of responses from local people and businesses.
“It’s an important decision and one I’m determined we get right for our residents and the staff involved. I am committed to keeping our streets clean, increasing recycling and making the borough cleaner and greener.”
A Veolia spokesperson said: “In the past 10 years, Veolia has been proud to work in partnership with Tower Hamlets to improve recycling rates and provide high-quality services for residents. During this time, we have delivered £3.5m of annualised savings through innovation, flexibility and efficiency whilst absorbing population growth that exceeds anywhere else in London and the UK.
“Our service delivery includes a recycling rate that outperforms neighbouring boroughs, missed collection rates that remain under 0.1% and independently reviewed street cleansing operations delivering above standard results. Given our strong service performance and the successful running of the contract, we find the move to take services in-house disappointing.
“We have been asked to continue working with the council until 2020, and are committed to maintaining the highest possible operational standards as well as assisting in a smooth transition.”
The Environmental Services Association earlier this year called on councils to tender waste management contracts competitively rather than use in-house options, with nearly 50% of contracts due to expire by the end of 2019.
It said projected savings through avoiding procurement costs and not paying for an operator’s profits were “often an illusion”.
- This story was updated on 20 November at 11.27 to include comment from Veolia.