Special investigation: The 11th hour change of mind over Norfolk’s incinerator revealed
12:12 17 December 2013
© ARCHANT NORFOLK 2013
A recommendation over which company should be picked to build the hugely controversial Norfolk incinerator at King’s Lynn was changed just hours before county councillors were due to make up their minds, it has emerged.
Focus on Norfolk County Council
Over the course of this week, the EDP is looking at four key county council issues – the incinerator, children’s services, the former RAF Coltishall and the Norwich Northern Distributor Road.
We will look at the past, the present and the future and show how:
An 11th hour change of mind altered the course of the King’s Lynn incinerator saga, while unelected council officers were allowed to vote on issues which led to decisions made by councillors.
Social workers have been struggling to cope with “unmanageable” caseloads in children’s services.
Almost £14m has been spent on the Norwich Northern Distributor Road before planning permission has been secured.
Almost 30 businesses have expressed an interest in setting up at the former RAF Coltishall base, bought for £4m by the county council.
It can also be revealed council officers were given votes on which company should be recommended for selection to run the proposed incinerator - a state of affairs described as “surprising” by the current council leader and “staggering” by another councillor.
Questions have been asked over whether officers did enough to mitigate the risk of the Saddlebow proposal not getting planning permission and if the controlling cabinet, rather than full council, had the authority to award the contract.
But a QC, in a report commissioned by Norfolk County Council’s cabinet and published yesterday, said proper process was followed.
Jonathan Acton Davis, QC, selected by anti-incinerator campaigners to carry out the independent review, said: “I can find nothing to lead me to conclude that any undue risk was taken. I can identify no areas in which I can see potential scope for the holding to account of officers. I have found nothing which would enable me to conclude that the cabinet exceeded its authority in authorising the contract.”
Mr Acton Davis, who said some of the emails he had been copied into during his probe consisted of “little more than abuse” stressed he was only asked to consider the process, not the political conduct of members.
He acknowledged he had “some difficulty” over whether officers had identified how to pay compensation should the plant not get planning permission.
He said he would have expected officers to have “at least considered” whether the council could pay that and identify the funds, but had found no evidence they had.
But, he said the officer explanation was it had not been forseen there might be a change of mind, that the risk of planning failure was low and that, before May this year, the council had sufficient reserves to pay compensation.
Council leader George Nobbs said: “We accept Mr Acton Davis’s conclusions and we expect everybody else to do the same.”
The EDP today investigates the start of the saga.
While it was the controlling Conservative cabinet which agreed, in November 2010, to appoint Cory Wheelabrator as the preferred bidder, the recommendation came from the Norfolk Waste Project Board.
On that board, unelected council officers were among those who voted, in October 2010, to put Cory Wheelabrator forward to other councillors for a decision.
Council officers Mark Allen, assistant director of environment and waste; Paul Borrett, strategic waste manager; Harvey Bullen, head of budgeting and financial management and Joel Hull, project director (residual waste services), were all members of the Norfolk Waste Project Board.
And, along with three councillors - James Joyce, Liberal Democrat county councillor (and now the county council’s deputy leader); Conservative Brian Long, deputy leader and environment portfolio holder at West Norfolk Council (and also a county councillor) and Ann Steward, then a Conservative county councillor and cabinet member for sustainable development - all voted to recommend to cabinet that they go for Cory Wheelabrator as preferred bidder.
And, in another twist, just hours before the waste project board meeting, the recommendation changed.
Until then, AmeyCespa, which proposed an incinerator at the same Saddlebow site, was to be appointed the preferred bidder.
Minutes of the meeting reveal a “major concern” about AmeyCespa’s bid. The exact concern was redacted, but it is understood it related to whether AmeyCespa could guarantee a certain amount of waste for the incinerator being transferred from Cambridgeshire.
The council acknowledges AmeyCespa’s bid was “slightly cheaper” than Cory Wheelabrator. The council will not give a figure, but MP Henry Bellingham, during a parliamentary debate in January said it was £47m cheaper, while other sources suggest it was closer to £70m less.
The council says: “Cost is only one criteria for assessing value for money. When all of the criteria, including quality of service, performance levels and guarantees were evaluated, Cory Wheelabrator’s bid achieved the highest score.”
Mr Long, one of those who voted for Cory Wheelabrator to be recommended to cabinet as preferred bidder, but who is now a critic of the scheme, said just two hours before the meeting, an email was sent saying the recommendation had switched.
Mr Long said: “My thoughts are that, at the time, it was all presented in a way that we would not have been able to make any other decision.”
QC Mr Acton Davis points out that the change was made so late that documents presented to the board still contained a recommendation that AmeyCespa should be picked, which he said was “perhaps an indication of the pressure that officers were under”.
But he said there were “no contemporaneous record of members being confused by that which was presented to them”.
In January 2011, there was another vote by the project board, recommending cabinet award the contract to Cory Wheelabrator.
Councillors Mrs Steward and Mr Long, along with Conservative William Nunn voted in favour, while Green councillor Andrew Boswell voted against.
The minute taker at the meeting recorded that they could not be sure if councillor Mr Joyce had voted in favour or if he had abstained, although it has subsequently been confirmed he abstained.
Council officers Mr Hull, Mr Allen and Mr Bullen, voted in favour and there was also a vote in favour from Mike Jackson, the department director, who was not present for the vote at the October meeting.
The final vote in favour of recommending cabinet to approve Cory Wheelabrator was from Richard McKenzie-Browne, a government officer from the Department for Environment, Food and Rural Affairs. who was helping the council with the PFI project.
Tim East, Liberal Democrat spokesman on planning, environment and transport, said he found it “staggering” unelected officials had been given votes, albeit only in a recommending capacity.
He said: “This whole saga has been very unsavoury. The whole situation around the incinerator has been manipulated and we have been misinformed.”
And, given Labour’s manifesto at May’s elections contained a pledge that: “We will use all legal means to suspend any plans for building any incinerators in Norfolk so that a detailed study of current, suitable methods of waste disposal can be undertaken”, how does that square with the incinerator remaining in the pipeline, despite losing £169m of government PFI credits?
Mr Nobbs, leader of County Hall’s UKIP-supported Labour/Liberal Democrat administration, said: “It squares perfectly with it.
“The first thing we did when we took minority control was to seek legal advice on whether we could withdraw from the contract.
“Was there an easy way out? No, there wasn’t. There was no legal means to renege on that contract. We have, at all times, relied on the advice from senior officers and I hardly need reiterate the disastrous consequences of cancelling prior to any decision by Eric Pickles.
“There was a free vote at full council and the council had never voted on that matter before. I think what we have done has complied with the letter and the spirit of the undertaking in our manifesto.”
Mr Nobbs said it was “surprising” unelected council officers had been able to vote on what recommendations to put to cabinet, but that it was under the previous administration.
The decision on whether to ratify planning permission now rests with secretary of state Mr Pickles.
THE ‘DISASTROUS’ DECISION NOT TO TAKE PART IN THE WEST NORFOLK POLL
The leader of the county council has said a decision by his predecessors not to take part in the West Norfolk Council poll, where 65,000 people voted against the incinerator, was “disastrous”.
While the King’s Lynn Without Incineration campaign group presented its argument against the burner, the county council, on legal advice, did not.
And Cory Wheelabrator steered clear as well, with a leaked communications strategy from their consultants revealing spin doctors believed they could use their lack of participation to undermine the moral value of the poll.
For the county council’s part, they said their legal advice was that there was a risk in actively participating in the poll as the waste planning authority, knowing it would have to consider the planning application.
There was concern that taking an active part could lead to a challenge, especially as the procurement process had not been concluded.
The council said it advised West Norfolk Council it was happy for information which was already publicly available to be printed on the ballot sheet.
They said the borough council chose not to include it in printed form, but to provide a website link.
The ballot sheet also explained why the county council was not taking part.
County council leader George Nobbs said: “On reflection, I think that decision was disastrous in terms of the county council’s reputation, the project itself and relations within the county. However, I understand why the county council felt it right to follow the legal advice it was given.”
IS THE CONTRACT STANDARD?
One of the many issues opponents of the incinerator have is why Cory Wheelabrator stands to get so much compensation, should the plant not get built.
The Anglo-US consortium stands to receive about £24.7m if planning permission is not obtained while, if the council pulls the plug on the scheme, there would be an estimated compensation payable of £28m, according to an independent report by PriceWaterhouseCooper.
To anti-incineration campaigners, those sorts of breakage costs have aroused suspicion the contract Norfolk County Council has signed is not standard.
An article published in a trade publication in June 2012 quoted Mike Harlow, a partner in KPMG, who worked on the Cory Wheelabrator contract, as saying: “significant discussion was had negotiating changes to the standard contract”, including to accommodate, among other things, compensation on termination.
A Freedom of Information Act request by anti-incinerator campaigners revealed that article prompted an email to DEFRA (who had agreed to award PFI credits to the council for the project) from Joel Hull, the county council’s residual waste services project director.
In it, he wrote that the report went into “intense detail about the financial elements and structure of CW’s bid; way more than we have ever released or would feel comfortable in releasing.”
The county council, when asked why Mr Hull felt that way, said it was “because it revealed financial information about Cory Wheelabrator’s bid which the officer considered was potentially commercially sensitive”.
They said he wrote to Defra to “clarify” that the authority had not released that information.
The county council line is that: “The contract complies with the principles and approach set by the government for all of the procurements that were run by local authorities under Defra’s Waste Infrastructure Delivery Programme.
“However, in some parts of the standard contract whilst the principles have to be adhered to the draft contract terms are not fully prescriptive.
“This is to accommodate the wide range of different proposals from different bidders that the government expected to attract through its programme, to make the process as competitive as possible and maximise value for money.
“One example of this is the ability to accommodate different funding approaches by different bidders. For example, some bidders fund their bids through corporate finance (where they fund the project from their own balance sheets and/or corporate debt – for example Veolia’s project for Leeds City Council) or project finance (where they fund the project predominantly through ring fenced bank debt, with some equity injection).
“In the case of Cory Wheelabrator’s bid it was a hybrid of these, they intended to borrow money from banks to fund the project and were prepared to stand behind some of that money themselves.”
WHY SUFFOLK HAD A SMOOTHER RIDE
While the proposal for an incinerator in Norfolk has generated considerable controversy and opposition, it’s a very different story over the border. Suffolk’s incinerator is due to start burning waste next year, which the council says will save £8m in landfill taxes. Paul Geater, political writer for our sister papers The Ipswich Evening Star and the East Anglian Times, gives his views on why the Great Blakenham burner has had an easier ride than the Saddlebow proposal.
“Suffolk County Council first announced it would sponsor the building of an incinerator (or “energy from waste plant” as it insists on calling it) in 2007 and said it had several sites under consideration – however, it was clear that Great Blakenham would be the one they went for.
“It was announced in January 2008 that the highways department at Blakenham was the preferred option.
Andrew Cann, county councillor for Ipswich, hit out at the proposal and tried to get a campaign going, but it was soon clear this would never take off for a number of reasons:
“The site was very close to that of a closed cement works. With modern emissions control there was a feeling that anything that put into the atmosphere would be less toxic than what had gone over the area for decades.
“The cement works had recently closed – the incinerator offered the prospect of new jobs for future generations.
Local residents were much more occupied with fighting plans for the “SnOasis” project which has never got off the ground and saw the incinerator as the lesser of two evils.
“The incinerator is well-sited, just off the A14 with a comparatively easy access and with a rail line beside it which could be used if waste is brought in.
“It’s opposite a massive landfill site which stinks anyway. People don’t believe the filtered emissions will be any worse than that. It’s also in an area surrounded by scrapyards.
“Over the last few years Suffolk County Council has won awards from national bodies for its consultation process.
“Although no one has ever said as much on the record, it is clear there is a fair degree of satisfaction that Suffolk has managed to get the plant built while Norfolk has found the whole subject so toxic.”
TOMORROW: Union leaders reveal how “unmanageable” caseloads and funding cuts has hit children’s services.