Sale
94. Throughout this section we have been looking
at what some witnesses, such as the British Retail Consortium,
have described as the 'push' and 'pull' factors which enable recycling
to take place.[161]
The 'push factors' are those, such as the Landfill Tax or kerbside
collection, which encourage diversion of materials into the recycling
stream; 'pull factors' are those such as the establishment of
a greater number of reprocessing facilities, which ensure the
processes have a successful outcome. The guarantee of a market
for the materials is the final, essential, 'pull factor'.
95. In its previous Report, the former Committee
highlighted what may happen if the 'pull factor' is not put into
place: in the early 1990s the German government introduced legislation
which required recycling of large quantities of waste materials
through a system known as Duales System Deutschland (DSD). Legislation
is a strong 'push factor' but without a market guarantee to balance
it, the inevitable happened. The country found itself with large
stockpiles of recycled materials for which there was no buyer.
The price of these products fell as the
international market was flooded; the UK's recycling
industry was badly damaged; and many of the products ended by
being incinerated or landfilled, the energy used in recycling
them wasted.[162]
96. Comments about the need for market stability
for recycled materials were widespread. Martin Nesbit of the DETR
agreed that industry will need to be confident both of supply
and sale in order to invest in new mills and other facilities
for reprocessing recycled materials;[163]
David Boyd of UK Waste told us that the ability to guarantee a
market determines what his company chooses to recycle;[164]
Aspinwall & Company identified the need for an economic incentive
to use recycled materials in preference to cheap, virgin products.[165]
Their comments were echoed by the Local Authority Waste Disposal
Contractors Association, the Urban Mines Company, the Onyx Environment
Group and Incpen.[166]
97. Traditionally, the international market for recycled
materials such as paper has been prone to severe fluctuations,
to the point where David Beal of Recycle UK (a subsidiary of UK
Waste) told us that recycling centres have had to be closed down
"because the price of newspaper and cardboard has gone from
£100 [per tonne] to virtually zero and there is nothing you
can do".[167]
We were told that to some extent prices have stabilised.[168]
Yet there remains a problem of lack of demand for recycled products
which must be addressed if recycling is to increase. It is a problem
which can be looked at in two ways: firstly, uses need to be found
for the products created;[169]
and secondly, that products must be created for which there are
uses.[170] In addressing
the second point the requirement for quality is likely to be a
prime consideration while for the former, the British Retail Consortium
perceived a role for Government in stimulating research into the
potential uses for recycled materials.[171]
98. Creating some degree of market stability is unlikely
to be an easy task; if it were, it would have happened by now.
The former Government trusted to the market to stimulate demand,
but it has only done so up to a point. The current level of recycling-6.5
per cent-reflects market conditions but it does not reflect the
requirements of a sustainable society.[172]
If the Government wishes to see recycling increased for any effective
purpose and to any significant degree, it will now have to think
very seriously about intervening more directly in the marketplace.
99. There are a number of things which Government
can do. It can challenge the perception that recycled products
are inferior by using them itself and telling industry what products
it would use if industry produced them.[173]
It can increase the Landfill Tax in order to 'push' more material
into the system. It can encourage investment in local reprocessing
facilities through programmes such as the Private Finance Initiative
and can assist authorities in establishing long term material
supply contracts with reprocessors. It can seek voluntary agreements
within industry to use more recycled materials. The Minister has
expressed his commitment to these tasks,[174]
which we welcome, yet all of these activities may not be enough.
A number of other initiatives have been suggested by witnesses
to our inquiry including the establishment of legislation determining
minimum recycled content for certain products;[175]
the reduction of VAT upon recycled products, to stimulate demand;[176]
revising national product specifications which currently work
against the incorporation of recycled materials;[177]
and the establishment of a tax upon virgin materials which would
make the cost of recycled materials more comparable.[178]
100. We have concluded that, as the Minister said,
the establishment of a stable market is the key to success in
a future recycling strategy. Without a market it may be possible
to increase markedly the materials being recycled, but it will
not be possible to find a beneficial after-use for them. If such
a use is not found, all the efforts of local authorities, voluntary
groups, individuals and industry will have been wasted as they
were in Germany. We have been heartened by the evident goodwill
of witnesses towards recycling. We look to the Government to build
upon this goodwill by intervening in the market to secure stability
and a successful strategy. Local government must also play a part
by the operation of green procurement policies. In other policy
areas this Government has demonstrated that it is not afraid to
tackle difficult problems; we would expect it to demonstrate the
same degree of active commitment in addressing this one.
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