Posted: 27.09.20 at 06:00 by Daniel Mumby - Local Democracy Reporter
Somerset taxpayers may have paid £1.5 million too much for bin lorries because of an European cartel, the county’s waste partnership claims.
The Somerset Waste Partnership (SWP) is to take part in a group legal action against a number of companies which manufactured waste trucks between the late-1990s and the early-2010s.
The SWP estimates it may have been overcharged by more than £1.5 million over this period – money that could have been spent on other front-line services, or passed on to residents through lower charges.
The legal process will begin in November and could take many months to resolve, depending on the complexity of the case and the number of parties involved.
Details of the case were published ahead of a virtual meeting of the Somerset waste board on Friday morning (September 25).
A spokesman said: “The European Commission found that a price-fixing cartel ran from 1997 to 2011 and involved DAF, Daimler (Mercedes-Benz), Iveco, MAN, Volvo (Renault) and Scania.”
The commission’s investigations concluded that senior managers had “fixed prices” for trucks and delayed the introduction of new technology to tackle emissions.
Both public bodies and private companies who were affected by the cartel have until November to decide whether to be part of a group legal action to recoup some of the over-charging for vehicles purchased in this period.
The SWP said that it spent £6.7 million on 76 new truck purchases between 1997 and 2012, when prices returned to their pre-cartel, competitive levels.
Its preliminary investigations indicate that it could claim back between ten and 25 per cent of this – anywhere between £670,000 and £1.675 million.
A spokesman said: “It will be for specialist lawyers to determine whether all of the vehicles are likely to be successfully claimable for.
“The number of vehicles involved and therefore spend figures may change, so best to describe as ‘up to’. And, obviously, anything we get would be a fraction of that figure.
“The essence of the claim is that prices were artificially inflated by the cartel, so any claim would only be for a fraction of the purchase price.”
In addition to claiming back some of the costs for the trucks, the SWP may be able to claim for the increased cost of outsourced services to other companies, such as Kier, if the price they paid is deemed “excessive”.
The SWP said the cartel was “a Europe-wide issue” and other local authorities across the UK may have also been affected.
The spokesman said: “Across the country, and indeed across Europe, there are likely to be numerous local authorities and private companies that run fleets of trucks who are affected.
“It is clear to us that the potential chance of success and the potential amount means that it is sensible that we pursue this.”
The SWP said the purchase of its new vehicles for the roll-out of Recycle More – which begins in Mendip on October 26 – was not affected.