The report of the Chief Executive is attached.
It was RESOLVED that:
a) the dissolution of Streetwise Environmental Ltd (teckal) be approved, with the service to move to an inhouse model of delivery by the Council by 1 September 2022;
b) the Cabinet Portfolio Holder for Environment and Safety be asked to provide Cabinet oversight to the insourcing project;
c) the Chief Executive be authorised to take all necessary steps to give effect to the transition, in line with the core principles as set out in Appendix B of the report;
d) the Monitoring Officer be authorised to work with the Streetwise Company Secretary to take all necessary steps to comply with the legal requirements arising from the dissolution of the companies including signing company filings;
e) the use of £0.3m from the Organisational Stabilisation Reserve (to be incorporated within the Medium Term Financial Strategy, to be presented to Full Council) to meet the transition costs as stated at paragraph 7.1.3 of the report be approved;
f) thanks be recorded to Mr Nigel Carter, Managing Director of Streetwise Environmental Ltd, Mr Keith Daniel, Chairman, and the Streetwise staff for their continued high quality service delivery; and
g) an update report on progress be received later this year including an update on the timeline for the dissolution of Streetwise Environmental Ltd (Trading). The existing Streetwise Oversight Board will continue to meet during this period.
The Leader, Councillor Robinson, presented the report of the Chief Executive outlining proposals for the future delivery model for Grounds Maintenance and Street Cleansing Services.
Councillor Robinson referred to the establishment of Streetwise in 2014, which had included two entities, Streetwise Env Ltd (trading) and Streetwise Env Ltd (teckal). Cabinet was advised that the ambition at the time had been to establish a social enterprise company, with franchising, and to operate in commercial markets as it expanded, with its main focus on delivering the Council’s core environmental services contract.
Councillor Robinson advised that a cross-party member working group had been established to oversee the project, and based on its recommendations, the two companies were launched. In 2018, the main contract had been extended until August 2022, and Cabinet noted that during the tenure of Streetwise it had been a very challenging period, for various reasons, including the effects of the Covid pandemic, changes to the market and how services were delivered, and in particular the loss of a major contract with Metropolitan Housing.
Cabinet was advised that with the contract renewal due in August 2022, the Council commissioned an independent report undertaken by Kelake, a third-party industry expert, details of which were highlighted in the report. Kelake looked at future options for the contract, if it should be extended, or be brought in house, to provide the most viable option and best value for money. Officers and Cabinet members reviewed those two options, together with Streetwise Business Plans and it was noted that the top priority of this review was to ensure that the core contract was fulfilled. Financial costs were also considered, details of which were highlighted in paragraph 7.1 of the report and Appendix C and based on this review it was being recommended that the service be brought back in house. In making this recommendation, Councillor Robinson stressed that this decision did not reflect on the Streetwise management team and staff, who had provided an excellent service, during very challenging times, and in particular the Managing Director was thanked for his hard work.
In conclusion, Councillor Robinson stated that this was the time to take strong, decisive action, to ensure that the most viable delivery of the core contract was maintained going forward, for the benefit of residents in Rushcliffe.
In seconding the recommendation, Councillor Moore agreed that this had not been an easy decision to make and confirmed that a great deal of discussion had taken place, with the loss of the key contract and the vagaries of the market being partly responsible for this decision being made.
Councillor Robinson referred to the recommendations and noted that the Cabinet Portfolio Holder for Environment and Safety would provide an oversight on the project, to ensure a seamless progression, and the Monitoring Officer would be responsible for overseeing the legal process. It was reiterated that this had been a very difficult decision, which had taken a great deal of time, and it was the best decision for all Rushcliffe residents.
Councillor Brennan referred to the positive feedback she had received from residents regarding Streetwise’s work and stated that she was confident that the Council would continue to maintain that high level of customer service going forward.
In conclusion, Councillor Robinson referred to the new direction being given from the Government and the Chartered Institute of Public Finance and Accountancy (CIPFA), being more reticent to undertake commercial activity, and it was noted that other councils had recently experienced problems. Streetwise was profitable, it was no detriment to the company that this decision had been made, and Cabinet was reminded that the Council had to be mindful of Government policy and CIPFA guidelines, to ensure that going forward risks were minimised for those paying Council Tax.