Agenda item

The Interim Director of Place introduced a presentation summarising the steps taken to get to this stage and recommendations to future actions to be taken.

Cabinet received a report in July 2025 which reviewed the updated Business Case for Future Service Provision for Recycling and Waste. Cabinet resolved to proceed with creation of a Local Authority Trading Company (LATCo) and to receive a future report outlining financing options and detailed governance arrangements. The current report addressed these issues and recommended appropriate actions. Structure and governance arrangements had been developed by legal firm Bevan Brittan, in

consultation with the Recycling and Waste Portfolio Holder Group and Officers. Options for the funding mechanism had been assessed and a flexible loan arrangement had been identified as the preferred option.

The Chair and Cabinet thanked and paid tribute to the Portfolio Holder Group for their service and Andrew Hancock, Dave Roberston and Mark Barrow for their hard work over a long time to get to this position in the creation of the LATCo.

RECOMMENDED to Council to:

1.     a. Approve of the updated Business Case at Appendix E

b. Approve of a loan of no more than £2.8 million to the LATCo

RESOLVED that Cabinet:

2.     Subject to 1 above that Cabinet approve the following recommendations: -

a.     To continue to progress the creation of a LATCo to take over provision of recycling & waste kerbside collections and associated services from 1st July 2026

b.     That operational activities of the LATCo are funded through a revolving credit facility with the Council which includes the potential for security.

c.     That delegated authority is granted to the Director of Place in consultation with the Section 151 Officer and Portfolio Holders for Finance and Environment Operations to make suitable arrangements and to enter into a formal loan agreement with the LATCo.

d.     That the maximum value of the loan agreement is no more than £2.8 million and that the Shareholder Committee receives a regular report on the status of the loan, to be provided by the LATCo Company Board.

3.     That a Cabinet Sub-Committee is formed immediately to undertake the Council’s role as owner of the LATCo, being the Shareholder Committee, following structure outlined in this report and the recommendations agreed within the Structure and Governance proposal agreed by Cabinet in July 2025.

4.     That Bevan Brittan are instructed to produce the following documents for approval by the Shareholder Committee

a.     Articles of Association

b.     Shareholder Agreement

c.     Governance arrangements for the structure of the Company Board

d.     Terms of Reference for the Company Board

e.     Advice on the necessary actions to ensure compliance with Subsidy Control legal requirements including a submission to the UK Subsidy Register.

5.     That Bevan Brittan are instructed to develop changes to the Council’s Constitution to set out

a.     The scope, powers and limitations of the Shareholder Committee, reflecting principles agreed by Cabinet in July.

b.     The purpose, scope and limitations of the Recycling and Waste Partnership Board, following the recommendations within this report.

6.      

a.     delegates responsibility to the Chief Executive to appoint two to three staff to act as temporary Company Directors during the formation stage of the Company, until the selection process for Non-Executive Directors is completed and,

b.     also delegates all future Company Board appointments and dismissals to the Shareholder Committee.

7.     That the Chief Executive, in consultation with the Leader and where necessary the appropriate Directors and Portfolio Holders, ensures effective ongoing oversight of the development of the LATCo and prior to the appointment of company managing director makes any required subsequent changes to the structure and development of the LATCo and appointment of its employees, to ensure that the establishment of the LATCo proceeds and meets the required key milestones and timelines.

REASON:

To enable the legal and effective establishment of the LATCo to be ready to take over provision of recycling & waste kerbside collections and associated services from 1^st July 2026. Items in the report would ensure effective and complaint governance and financial arrangements such that the company can operate.