Three Hampshire authorities have started looking at options for how rubbish from people’s homes is disposed of.

Hampshire County Council, Portsmouth City Council and Southampton City Council have begun exploring options for a new waste disposal service contract.

The current contract was taken on by Veolia UK in 1997 and will expire in 2030. The current waste disposal system consists of two material recovery facilities, three energy recovery facilities, three open-air windrow composting sites and 11 waste transfer stations.

Council documents state the key benefit of the current contract is the “regional approach” and the economies of scale gained from three disposal authorities working collectively.

They add it is “critically important” that the procurement process starts early to allow sufficient time to develop the options available.

These include extending the contract with Veolia, each council providing in-house services, or a fully integrated contracted service. This option would broadly be the same as the current arrangement with the potential to include rubbish from tips – bringing all aspects of waste services under one contract.

Another option is lotted contracts, which would separate the services by their function or geographic area. This would produce smaller contracts, working together, to manage services.

Alternative delivery models, such as a local authority trading company, would allow the councils to maximise the commercial opportunities to generate a profit. The company would operate as a normal company but would remain owned and controlled by parent councils.

Extending the contract beyond Portsmouth and Southampton to bordering local authorities, such as in Surrey or West Sussex, could “further maximise economies of scale”.

In 2022/23 the disposal costs, shared between the three authorities, amounted to around £75m. Hampshire County Council is responsible for 77 per cent of the cost while city councils in Portsmouth and Southampton pay around 11.5 per cent each.

The procurement process is estimated to cost up to £1.6m in the financial years leading up to 2030/31. Of which Portsmouth City Council will pay £185,000 (11.52 per cent).

Councillors will discuss the report with Portsmouth City Council’s cabinet member for environmental services councillor Dave Ashmore on March 11.