BURY could go all the way to the European Court to retain its multi-million pound bins contract.

The council is making history by fighting the Government in a challenge which could have massive implications.

Its lawyers have been called back to the High Court in the latest round of the legal battle to keep the lucrative refuse collection contract in-house.

Bury Contract Services won the contract in 1995 with a bid which was £1 million a year lower than its nearest rival.

But the Secretary of State for the Environment ordered that the contract be retendered, saying the council had behaved unfairly towards competitors.

Furious council leaders started a judicial review in the High Court, arguing that the Government had acted against European competition laws.

Stan Monaghan, council solicitor and secretary, said a similar case involving Portsmouth had affected Bury's case, which relies heavily on the Euro dimension.

"Our barristers are going back to court because the judge wants to see which areas impact on our argument, and he could decide to transfer the case to the European Court."

Mr Monaghan explained that if an EU country refused to implement a European law, an individual could claim "direct effect", ie by-pass the Government and claim the benefit of that law.

But it has never been determined whether a local authority can claim "direct benefit" against the UK Government.

"I'm just as optimistic as we've always been," said Mr Monaghan. "We've got a very strong case and I'm convinced we will win.

"I still think the Secretary of State's decision was completely over the top, especially as our contract saves Bury residents £1 million a year.

"That has to be taken into account regardless of whether we lose the legal argument."

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