A waste firm rejected for the refuse collection contract in Brighton and Hove is seeking talks with the council over its loss of business.

Serviceteam is considering what to do after Cabinet councillors decided they did not want the firm to take over from Sita, three days before the contract was meant to start.

Months of negotiations broke down after the recommendation by council officers, who said Serviceteam's price was too high, was agreed by the Cabinet.

It is expected to be rubber-stamped at a policy and resources committee meeting tomorrow.

From Monday, the waste service will be operated by Brighton and Hove City Council for a period of about 18 months.

Serviceteam marketing director Philip Walker said the company, which was the only remaining bidder, had invested time and money into Brighton and Hove for nothing.

He said: "We will have to have a professional discussion about the amount of resources we have put in.

"We provided a robust way of managing a situation that was not in the best shape without being told the council was considering providing the service in-house.

"If they had told us that at the start, we would have walked away."

Serviceteam arranged the hire of trucks and vehicles for the rounds, which were still in secure car parks around Sussex last night.

Money has been spent putting the firm's logo on the side and fitting them with radios.

Other vehicles are either ready, or on order, from at least two companies in Sussex, which have expanded their fleets to meet demand.

When one supervisor, who did not want to be named, called the council to find out what was going on, he was told to call The Argus.

He said: "We have ordered a lot of kit on the basis of this. No one has told us what is happening."

A council spokesman said vehicle lease agreements had been underwritten by the authority.

This morning, council officers should have decided what trucks will be used for collections and street cleaning. They may borrow vehicles from Sita for several weeks.

For the past two weeks, Serviceteam managers have been giving health and safety training to the workforce they thought they were going to employ from Monday morning.

Two of the company's five directors have worked on the city contract for three months, supported by ten other people.

Their plans examined every possible factor that could affect productivity, including six-month weather forecasts estimating the number of days of heavy rain when trucks could get stuck at the Beddingham tip.

City council leader Ken Bodfish said he understood Serviceteam's disappointment but could not accept its criticism.

He said: "Throughout this process, we have acted in good faith and were pleased to be working with a company with a good national reputation.

"However, our duty is to provide the best possible service at the best possible price. It is local people who pick up the bill. The advice from our officers is that Serviceteam's bid does not represent value for money and the council would still be responsible for too much of the risk in the contract.

"We are not commenting on Serviceteam's reputation in delivering refuse and other services elsewhere in the country.

"It is simply that, at the end of these complex negotiations, our officers have been unable to recommend Serviceteam's proposal."

He said officers' analysis of information during negotiations had revealed the true cost of keeping the city clean.

He said councils had not needed to know the detailed price of contracts since the Conservatives introduced compulsory competitive tendering in the Eighties.

He said: "This is a legacy of Thatcherism. Councils used to be forced to take the lowest bid and if a company was unable to deliver at that price it was their fault.

"This has led to a situation where a lot of contracts were not properly costed because councils simply did not need to know."