THE running of the borough's libraries is up for grabs again after the contract with the preferred bidder fell through.
John Laing Integrated Services (JILS), the former preferred bidder, says it will now re-bid against a former competitor to run the libraries instead of the council.
Councillor Tim Pollard said the move followed JILS making a last-minute change to its proposal, over library staff's pension arrangements.
He said the change would affect the bid's "risk profile" and therefore the authority should, under EU procurement rules, hear from the three shortlisted bidders again.
Cllr Pollard added: "This does mean a short delay, but we are determined to secure the best value for the taxpayer."
He made the announcement towards the end of a full council meeting on Tuesday evening to approve this year's budget.
The last-minute announcement left no time for discussion and sparked outrage among the Labour opposition, who stormed out of the chamber.
Leader of the opposition Tony Newman said he would be seeking an emergency council meeting over the development.
He said: "The question we will be asking there is what is behind the collapse of this contract?
"The whole process is shrouded in secrecy and it involves millions of pounds worth of public money."
A JILS spokeswoman confirmed that it did plan to resubmit a bid, and said it was "an exciting proposition" for the company.
A spokesman for Wandsworth Council, one of the previous three bidders, said it would not be trying for the contract again while Greenwich Leisure Limited, the third shortlisted party, did not respond to a request for comment.