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Ongoing legal action surrounding a failed waste facility in Basildon could soon be swallowing up “substantial” sums of thr council’s £110m earmarked reserve.
Essex County Council has already drawn down around £7.5m of its waste reserve in the past year which at April 2022 is set to stand at £109m.
It is expected to draw down a further £13m in the year up to April 2023 and another £6m after that.
The estimated balance in 2024/25 is set to stand at around £90m.
The estimated spend comes amidst concerns over increased pressures on household finances.
The council council has announced it will raise its share of council tax for 2022/23 by an average of £60.
But cabinet member for waste at the authority, Councillor Malcolm Buckley, warned that the waste reserves were not able to be transferred from that financial account to another to pay for other services.
He said it’s due to the uncertainty of the dispute between UBB Waste Essex and the county council over the waste processing scheme at the Mechanical Biological Treatment (MBT) facility in Basildon.
He said: “The waste reserve is one of the larger reserves that we have available but I would just like to emphasise to cabinet that that is not a free reserve and opposition members have been briefed as to the litigation that’s ongoing as a consequence of the waste plant over at Basildon.
“The implications of that do mean that we may need to draw on substantial parts of that reserve in the future.
“It would not be proper for me to go into more detail than that but as there are other changes in the legal situation we will of course share those with opposition leaders in an appropriate manner.”
In August, the county council revealed opening a £13m warchest of taxpayers money to fund its continuing legal battle over the failed waste scheme which left it being owed around £36m.
The county council is remaining tight-lipped over the current legal position which still has not been fully resolved months after the authority won its right to terminate the contract with UBB Waste Essex – formed by Urbaser and Balfour Beatty (UBB) – for its waste processing scheme at the MBT facility in Basildon.
The 417,000 tonne capacity plant built under a 25 year £800m contract signed in 2012 never properly worked – the county council argued that the plant was not built correctly.
In 2017, the county council started court proceedings which were ruled in its favour last year. UBB Essex went into administration shortly after.
Subsequently, all deliveries of waste into the facility that had been accepting around 270,000 tonnes of black bag waste a year to be processed, avoiding the need for landfill disposal, were suspended.
Responding to concerns around the rising cost of living, energy bills and inflation while the authority sits on total reserves of £226m cabinet member for finance Councillor Chris Whitbread said the majority of its reserves are “fully committed “.
“He said: “I think it’s really important we realize that reserves are there because they’re working reserves, they’re working for us as a county.”