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Manchester's partners seek divorce settlement

Robin Latchem

It is said to be the biggest waste contract in Europe but for how much longer is anyone’s guess. 

It was one of the worst-kept secrets in the sector that the partnership between the Greater Manchester Waste Disposal Authority (GMWDA) and the Viridor-Laing joint venture was on the rocks. On 2 May, after a series of in-camera meetings, the authority confirmed that the 25-year private finance initiative contract was being terminated.

Talks continue and, unsurprisingly, Viridor will be seeking compensation.

But in 2009, when the parties formalised their £3.8bn marriage, it was presented as a template for the future of local authority waste management. Only 16 months ago, Viridor used its Manchester project as a template for so-called ‘English resource networks’, each comprising a package of regionalised infrastructure and dovetailed local collection and disposal services.

Revisiting the report today, which argued that typical resource management systems were no longer fit for purpose, the message has a different ring: “The successful ‘Manchester Model’ is Europe’s largest resource partnership between the public and private sector which is not only delivering results but, through its innovative 2020 Vision, is also attracting inward investment from manufacturers and supporting the region’s decentralised energy ambitions.”

The strains were just too great. Last year, constituent collecting councils said their ‘levy’ was too great and the GMWDA balanced the books from reserves. This year, the toughest yet for local authorities because of George Osborne’s earlier austerity budgets, meant even more pressure on the disposal authority to bite the bullet.The negotiations go on, so a likely solution remains conjecture but it is hard to see how any party will avoid short-term financial pain.

But all is not lost for Viridor. As with Veolia in Sheffield, Amey in Peterborough and several other examples, the authorities’ decision will mean fresh procurement and that means new opportunities.

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