THE firm responsible for cleaning Brighton's streets is pulling out of its contract after admitting it is making huge losses.

Ecovert South has agreed to pay £650,000 to help improve buildings in the town, in return for Brighton and Hove Council cancelling the contract.

The firm is so keen to pull out it will spend £250,000 on improvements to the Prince Regent swimming pool, £300,000 on the Valley Social Club in Whitehawk and £100,000 on redeveloping the east wing of Falmer School.

Ecovert South won the contract to carry out the old Brighton Council's cleaning in 1995. It beat off rival firms with the cheapest bid.

But since then it has faced almost constant criticism over its service.

Today, one of its fiercest critics, Peter Gatt, said: "They were bad when they took over and they are worse now.

"The tenants' associations all agreed that they had no confidence in them. They should bring in another company."

Mr Gatt, chairman of Freshfield Tenants Association, added: "When they came to the contract for this town I think they went in too low. They put in a low bid and now they are losing money and moaning about it.

"The Labour council put them in and made a big mistake. I think they should be got rid of altogether."

Council insiders say Ecovert is losing millions of pounds a year with the contract.

It was due to run until 2004, but will now end in October.

The service will then becombined with Hove, and companies will be invited to bid.

Ecovert South will be able to apply to run the new combined contract, but its bid would be far higher than the current level.

Staff have been told about the changes.

There is a good chance that a different company will be brought in to carry out the work.

Council contracts chairman Brian Fitch said the authority realised that Ecovert had been working under financial difficulties.

Coun Fitch said an independent survey was now being commissioned of work carried out by Ecovert.

He added Ecovert was losing money heavily on its street sweeping and refuse contracts.

"We are allowing them to finish and we will put out a combined contract for Brighton and Hove. "It was better to end the contracts early. Ecovert have also come up with some money for these projects which would have otherwise fallen on the council taxpayers."

Serge Zimmerlin, the company's director of human resources and communication, admitted that after four years, the firm was now losing money.

But he said Ecovert would be bidding for the new contract and hoped to win.

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