Extension and Variation of Contract for the Provision and Operation of a Materials Recovery Facility to extend contract for 12 months and to include Plastic film packaging and plastic bags

Consideration has been given as to whether the extension and variation of: (1) the Contract for the Provision and Operation of a Materials Recovery Facility between Gateshead Council (on behalf of itself, the Council of the Borough of South Tyneside and the Council of the City of Sunderland ("the Partnership")) and Cumbria Waste Management Ltd (Cumbria Waste) in respect of Lots 1 and 3 dated 14 January 2022 ("Contract 1"); and (2) the Contract for the Provision and Operation of a Materials Recovery Facility between Gateshead Council (on behalf of itself, the Council of the Borough of South Tyneside and the Council of the City of Sunderland ("the Partnership")) and J & B Recycling Limited (J & B) in respect of Lot 2 dated 14 January 2022 ("Contract 2"); for a period of 12 months and the additional inclusion of Plastic film packaging and plastic bags would be permitted under Regulation 72 of the Public Contract Regulations 2015. The modification renders the contract or the framework agreement materially different in character from the one initially concluded - a 12 month extension on the same contract terms, does not render the contract materially different. Furthermore the addition of one material stream (Plastic film packaging and plastic bags) is not considered a material change as this contract is for sorting recyclable materials which includes Plastic film packaging and plastic bags. • In addition to the reliance on the Regulation 72 (1) (e) above, the Council can also seek to rely on Regulation 72 (1) (c). Under this limb of Regulation 72, all of the following conditions must be met (the words in italics set out our reasoning as to why that condition is met): o Brought about by circumstances which a diligent Contracting Authority could not have foreseen - when the current Contract was procured in 2021 the Council could not have foreseen the impact of the change in legislation (specifically, the delayed and upcoming Deposit Return Scheme (DRS) and Simpler Recycling reforms). These changes will significantly affect the types and volumes of materials processed making it difficult to accurately define the requirements of a specification and complete a Procurement process at this time. o Does not alter the overall nature - it is arguable that an extension and modification on substantially the same terms as originally awarded does not alter the nature of the Contract. o The increase in price does not exceed 50% of the original value - The additional 12 month extension and the modification for the inclusion of Plastic film packaging and plastic bags will not exceed 50% of the original value. Various costing exercises using assumptions have been undertaken to support this.