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1 April 2014, 05:50 | Updated: 1 April 2014, 06:11
Norfolk County Council say they want to pull out of the plans for the plant in Kings Lynn at a cost of more than £20 million.
The waste incinerator was first suggested in 2005 but they are now recommending that the Authority’s Cabinet consider terminating the contract to build an energy from waste plant in King’s Lynn - on the grounds it has failed to secure planning permission.
It is expected to cost up to £30 million to get out of the contract.
A report to councillors says that Eric Pickles’ failure, as Secretary of State for Communities and Local Government, to meet his own timetable for deciding the planning application he first ‘called in’ for consideration back in August 2012 has seen the scheme’s value for money reduce with each week’s delay as costs rise and the contract payback period is shortened.
The continuing delay comes on top of the Government’s decision last November to withdraw a Waste Infrastructure Grant for the project worth £169m over the lifetime of the contract.
The council claims the combination of the two Government actions means that by June this year, savings to Norfolk’s taxpayers, guaranteed on signing to be over £250m over 25 years compared to the cost of landfill, will have completely flat-lined.
With contractors Cory Wheelabrator now seeking a substantial increase in the capped costs of termination through planning failure - and in the absence of any Ministerial decision on the horizon - officers are advising that the balance of risk is now tipped against Norfolk’s taxpayers and terminating the contract is the most sensible decision to take.
An extraordinary Meeting of all members of the Council which starts at 10am on April 7 to consider a motion brought by six county councillors will be followed by a meeting of the Council’s Cabinet to consider the outcome of that debate, the officer’s recommendation and take a decision.
Leader of Norfolk County Council, George Nobbs, said: "The officers' recommendation is clear and unambiguous, and it is my intention, after listening to the views of the whole Council, to recommend that Cabinet acts upon that advice.
"When Council in October voted for continuation of the contract, that was on the basis that it still represented good value for money. However, that was based upon accepting the Secretary of State at his word when he said he would give his decision on the Planning Inquiry 'on or before 14 January.' Mr Pickles' decision - or rather the total lack of it - has been the real game-changer, and has made a nonsense of Government rhetoric about speedier decisions on major infrastructure projects.
"What has been even more damaging has been his subsequent point-blank refusal to give us any idea of when, if ever, he might make a decision. There has been widespread view in informed political quarters that this delay has been a political decision and that no answer will come 'this side of the election'.
"The result has been that we are being asked to gamble with Norfolk County Council's financial future, and that I will not do.'
A report to councillors puts the cost of terminating the contract at around £30m, of which £19m is available from reserves set up for this purpose.
The remaining £11m will have to be found from reserves in the short term, but action will needed to be taken ‘in-year’ to bring reserves back up to an acceptable level and a report from the Interim Director of Finance will be brought to the May Cabinet meeting.
Elizabeth Truss MP has today welcomed the recommendation by Norfolk County Council officers to cancel the proposed incinerator in Kings Lynn. A report by NCC officers, published today, makes the case that the council should terminate the contract citing spiraling costs as the key factor. The cost of pulling out of the contract starts going up by £400,000 every month in May 2014.
West Norfolk MP Elizabeth Truss is welcoming the decision. ‘This has been an incredibly long saga but I am delighted Norfolk County Council are going to make the right decision. The people of West Norfolk have been heard. And this decision will save the county money in the long run. We know that this project that no one wanted would have cost at least £100m more than the alternative.
The proposed incinerator is too big, in the wrong location and not wanted by the majority of residents in West Norfolk. I would now like to see complete transparency about the contract, and the alternatives, so that we can get a cost effective solution for Norfolk that really does command public support.’