PFI has created a very modern problem – how should councils manage relationships with contractors when they stretch over decades and involve multi-million pound sums but also remain responsive to political change, advances in technology and moving priorities? It’s a problem that has come to the fore in Cornwall.

In 1998 consultants outlined a vision for Cornwall’s waste management that included incineration. In 2002 a waste plan was adopted by the council. In 2006 the council appointed a contractor, Sita, to run the contract in a £400 million 30-year deal. In 2008 Sita submitted a planning application to build an incinerator in a village in the middle of Cornwall.

The proposal faced concerted opposition – residents, environmental campaigners, councillors and three political parties opposed the incinerator arguing it was the wrong technology, the wrong overall solution and the wrong site: times had changed, newer technology was available, environmental concern was further-up the agenda.

The council faced a dilemma. On the one hand it was the independent arbitrator of the planning application; on the other it was the client in a complex relationship with the applicant.

A recent Freedom of Information request has shown a glimpse of how Cornwall tried to square this circle.

Over 480 pages the released documents reveal a culture of collusion between council officers and Sita that saw officers help manage the flow of information to councillors, the media and community and actively work together to undermine the arguments used by objectors.

In March 2009 the council’s planning committee rejected the application.

As councillors had expressed a clear view on the plans (and the council had changed political control) it would have been timely for officers to change tack and begin to push Sita to adapt to the new realities. Not in Cornwall’s case.

Indeed, the emails show that from the application being rejected to the appeal being lodged in September 2009, the efforts between council officers and Sita redoubled to rebuff the arguments that the councillors on the planning committee had used.

Later this year the planning inspectorate will face the task of untangling this mess. It’s a mess that’s been created because the line that should exist between a council and a contractor has been effectively erased. The two-entities, one a public authority with a duty to its residents and the other a corporate entity with a duty to its shareholders, have become one.

As this David and Goliath battle enters its final round, the council’s leadership says the planning committee’s decision to reject the incinerator will be “robustly” defended. But the released documents show this to be far from the truth. Senior council officers, reporting directly to the chief executive, are continuing to work with Sita to undermine the arguments that will be used at the appeal.

With multi-million pound contracts stretching far into the future being awarded by councils across the country, this case highlights the need to look closely at the dividing lines in these relationships to ensure the first duty of any council, the best interest of its residents, isn’t confused with the expedient interests of its contractors.