Essex County Council has opened a £13 million warchest of taxpayers’ money to fund its continuing legal battle over a 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 – for its waste processing scheme at the MBT facility in Basildon.
Administrators appointed at UBB Waste Essex revealed last October a list of four creditors – Urbaser owed £25.2 million, Balfour Beatty Group owed £10.8m, UBB Essex construction owed £2.2m and Essex County Council owed £26.3m.
It adds that Essex is owed £36m, which includes £10m compensation awarded when the High Court ruled that UBB was at fault for failing to design and construct a facility sufficiently good enough to operate properly.
However, it states that “the statement of affairs does not take into account the significant ongoing safety, security and compliance costs at the facility, for which UBB remains ultimately responsible”.
It adds that “any payment to unsecured creditors by way of the prescribed part, will be made by a subsequently appointed liquidator”.
It was also revealed that the contractors were being paid £86,500 a month to secure the site and maintain environmental controls.
UBB Essex had an “estimated total deficiency” of £85.8m.
ECC cabinet permitted the county council to draw down up to £13m from the Waste Reserve on an incremental basis “to resource the resolution of a dispute”.A spokesman for Essex County Council said: “Essex County Council is not paying any monies to UBB to maintain the facility in Basildon. The facility is owned and maintained by UBB.
“In June 2020, UBB requested that ECC ceased deliveries of waste to the facility.
“Prior to this date, ECC made payments to UBB for waste delivered to the facility for processing.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.
Since then, instead of first being sent to the Tovi facility for processing, black bag waste has been sent to landfill
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