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Firm scraps troubled PFI deal

Renewi has ended its troubled PFI contract with Dumfries & Galloway Council, 11 years ahead of schedule.

It said abandoning the loss-making deal would “deliver shareholder value”, while the council is to bring services in-house.

Under a transitional contract, the company will continue to provide services for two months, after which it will transfer services, facilities and employees back to the council.

James Priestley, managing director of Renewi’s municipal division, said: “We are pleased to have exited this loss-making contract under appropriate terms with all parties.

“We have concluded this exit on schedule while ensuring that services are maintained. We now look forward to working closely with Dumfries & Galloway over the next two months to ensure a seamless transition.”

Archie Dryburgh, chair of the council’s economy, environment and infrastructure committee, said: “This opportunity to bring waste management services back in-house will help the council to better plan and control the delivery of these services, as well as increasing the opportunity for recycling which many members of the public want to see.”

Renewi said last March that it wanted to exit the PFI contract, which it described as “unable to address the needs of Waste (Scotland) Regulations that set demanding new requirements regarding landfill diversion and recycling from 2021”.

Relations became acrimonious in July when the council branded Renewi as “irresponsible”, while the company has accused it of refusing to negotiate.

Dumfries & Galloway signed the 25-year PFI waste deal in 2004 with Shanks, which became Renewi last year following a merger with Van Gansewinkel Groep.

The council’s contract was with Shanks Dumfries & Galloway, for which Renewi UK Services acts as waste contractor.

 

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