Coun Carl Macey, chairman of the Health Scrutiny Panel for Lincolnshire, said there was “no light at the end of the tunnel” with Thames Ambulance Service.
Thames has come under fire for its performance and Lincolnshire West CCG, which commissions the service, said it would be kept under scrutiny.
Coun Macey said the CCG needs to come up with a plan to exit the contract.
“This has been ongoing now since the contract came to fruition two years ago,” he said.
“For the last seven months we have been promised that they will look at a strategic exit, but we’re still hearing now that they are waiting for improvements with no light at the end of the tunnel.
“We just feel that it’s now at the point where they need to be making that move, it’s not fair on residents and I think residents have got to the point where they have had enough.”
Lincolnshire West CCG said it would keep the contract under close review, despite a poor performance.
Sarah-Jane Mills, chief operating officer at the organisation, said she realised there had been “ongoing concerns”, but added that there had been improvements.
“We have seen some improvements, but Thames are still not achieving the key performance indicators,” she said.
“There are moves in the right direction.”
Thames contract for providing the service across Lincolnshire is set to expire in July 2020.
Councillors called for the service to be terminated in December 2018, but health officials said there were “major risks” in exiting the contract.
Lincolnshire West CCG, which is the lead commissioner for non-emergency patient transport services in the county, contracted the company in July 2017.
The service came under criticism from patients and forced Thames to apologise in February 2018 for poor performance in the county.
Since then, the firm has undergone a management restructure which includes Derek Laird, former commercial director of West Midlands Ambulance Service, taking over as chief executive.