Examination of Witnesses (Questions 351
- 359)
TUESDAY 2 JULY 2002
MR DIRK
HAZELL, MS
LESLIE HEASMAN
AND MS
GILL WEEKS
Chairman
351. Good morning, ladies and gentlemen. This
is an additional evidence session that we have laid on, on behalf
of the Committee, looking into hazardous waste disposal, so that
we could take further views, firstly, from the Environmental Services
Association, and secondly from the British Cement Association.
And I wonder if, initially, before you make some opening remarks,
those from the Environmental Services Association would be kind
enough, for the record, to introduce themselves and say where
you are from and what you do?
(Mr Hazell) Thank you very much indeed,
Chairman. We very much welcome the opportunity to give evidence
to this important inquiry. My name is Dirk Hazell. I am the Chief
Executive of the Environmental Services Association, which is
the UK's sectoral trade association for managers of waste and
secondary resources. On my left, your right, is Ms Gill Weeks,
the Regulatory Affairs Director of Cleanaway, one of the top five
waste managers in the UK, and one of only two now managing high
temperature incineration for hazardous waste. On my right, and
your left, is Mrs Leslie Heasman, the Technical Development Director
of M J Carter Associates, one of the leading consultancies providing
technical advice to our industry, and both Ms Weeks and Mrs Heasman
serve on a number of ESA's committees.
352. Thank you very much indeed. I think you
are going to give us a little set of remarks, for the first few
minutes, is that right?
(Mr Hazell) I am very happy to do that. I can certainly
start with a general introduction.
353. I think, if you could do, say, about five
minutes of that, just to give us an overview of where you are
coming from, and then we would like to ask you some questions,
please?
(Mr Hazell) As I have said, ESA is the sectoral trade
association for the UK's managers of waste and secondary resources;
and ours is an interesting industry, in a number of ways, but
one, particularly, in that it is driven almost entirely by regulation
and that is particularly the case for hazardous waste, and virtually
all the primary drivers now come from the European Union. So,
with respect to your Committee, the real reason, I think, that
your Committee is meeting today, and the real reason that ESA
is as active as it now is, is as a response to legal initiatives
that have come from the European Union; and this is an area of
law where not only is there Qualified Majority Voting in the Council
of Ministers but now Co-Decision with the European Parliament.
And, if you wish to pursue that, I think that is an area that
DEFRA has totally failed to pursue. But, as far as hazardous waste
is concerned, we are broadly dealing with a situation where, in
the UK's geological conditions, which are particularly favourable
to landfill, we are moving from a scenario where co-disposal of
hazardous waste with non-hazardous waste provides an environmentally
stable state, over time, within the landfill, towards a situation
where the Landfill Directive, as well as achieving some diversion
from landfill, is requiring hazardous waste only to go to hazardous
waste landfills, and only in a condition where it has been pre-treated
subject to the Waste Acceptance Criteria. And the Minister omitted
to mention yesterday that the Waste Acceptance Criteria materially
changed last week, but hazardous waste can only go, on the basis
of the Waste Acceptance Criteria, to hazardous waste landfills.
And that requires a response from our industry, which we have
given in our written evidence, and we truly believe that the position
of ESA is economically right for our country and the industry,
we believe it is environmentally right, and we believe that it
is ethically right. And I think there are two fundamental points
in our evidence. The first, as I have already intimated, is that
regulation is the key driver of our industry; you cannot possibly
expect investment in hazardous waste infrastructure unless there
is a regulatory framework that gives a reasonable prospect of
waste going to that hazardous waste infrastructure, and that,
at the moment, we do not have. If anything, the regulatory regime
in this Country is tending to push waste treatment down, rather
than up, the waste hierarchy; so the regulation is absolutely
paramount. The second key point in our evidence is that, once
the Landfill Directive applies to the hazardous waste, in the
sense of requiring that waste stream to go to mono-landfills,
taking only hazardous waste, for this industry to be asked to
accept into those landfills waste which does not meet the Waste
Acceptance Criteria is simply not an available option. And, with
all due respect to the Minister, yesterday, the point he made,
in response to our position on that, was really a debating point
rather than a point of substance; and Mrs Heasman will be more
than happy to elaborate. But we are very, very clear indeed that
there is no environmental justification for taking to hazardous
waste landfills hazardous waste that has not already been stabilised
to a safe state. So those are the two overriding points, I think,
in our evidence, Mr Chairman.
354. Thank you very much; those are very interesting
and, indeed, important points. I was going to ask you, if you
had been sitting here yesterday, what would have been the questions
you would have asked Michael Meacher, but, in a way, you have
anticipated that by marking out, very clearly, two significant
areas of reservation. One of the things that always concerns me
is that when people from an industry say, "From our side
of the fence, this is what it looks like," you will get an
opposite reaction from people like DEFRA and, indeed, the Environment
Agency, and I hope I do not do them a disservice by coupling them
with DEFRA, on their side of the fence, which will give an opposite
reaction, because that is the line that they are pursuing. One
or two things you have mentioned; why do you think the Government
are pursuing the line they are, why do you think that they think
that they are right, and you have given a clear view that you
think that they are wrong? Just help us to understand these two
areas a little more?
(Mr Hazell) I think, in very broad terms, the British
Government has yet to form a view as to the kind of waste regime
it wants to have in this country, and that is an acute difficulty
for our industry. Our members want to invest a billion pounds
a year in new infrastructure for the foreseeable future, but we
simply do not know, as of today, whether the Government wants
to continue with the cheapest possible solution it thinks it can
get away with under European Law, or whether instead we are going
to try to move to the best practicable environmental option that
can be achieved in the context of the European Framework. We simply
do not know. And Mr Meacher said, in answer to Mr Hunter, in a
Parliamentary Question, on 25 March, "The Department has
made no estimates of the amount of hazardous waste that will require
treatment from 2005 to 2010." On the Environment Agency,
we do not really know what is the quality of the information that
they use, but we do know that the quality of the data that the
Agency have is not as good as it might be. We are dealing with
a situation that, probably, in the context of DEFRA, is chronically
underresourced. I have been at ESA for three years, I am dealing
now with the third generation of official; key positions are unfilled,
there is absolutely no internal legal support for the DEFRA officials
that we liaise with at all within DEFRA on key issues of interpretation.
Again, Mrs Heasman can give you some very specific, immediate
examples. And when we try to go to DEFRA and say, "Can we
help you, can we together go to a leading QC, not some back-street
lawyer, a leading QC, to get an answer on that?" the response
is one really of suspicion and "What are their motives?"
And it might be shocking to this Committee, given the strategic
role of waste as the second environmental priority of this Government,
but we have never had a substantive discussion with DEFRA on the
strategy of waste management in this country. I recall no instance
where DEFRA officials have ever, for example, discussed with us
the Sixth Environmental Action Programme. On planning for our
industry, planning for an industry that wants to invest a billion
pounds a year for the foreseeable future in new infrastructure,
officials refused to discuss the Planning Green Paper with us.
Lord Rooker, the new Minister, he sent us a very nice letter;
obviously, the Office of the Deputy Prime Minister, in there,
it is more charming than its predecessor, but, again, a refusal
to see us, pending the outcome of the PIU study. So, in very broad
terms, I think it is probably an issue of the real priority that
has been attached by the Government to waste management; that
said, since the appointment of the current Secretary of State,
we have given her the fullest possible support. I do not think
one could have asked more of a Secretary of State in her first
year of office than to launch a Cabinet Office review; the difficulty
is going to come when the words have to become deeds.
355. Let me just ask this question. I hear what
you say, when you say "a billion pounds of investment,"
it sounds fantastic; but we had the pleasure of visiting, in fact,
Ms Weeks's incinerator, and I was very pleasantly surprised by
what I saw, it was the first time I had been to a modern incineration
facility. But you could see that there is obviously a vested interest
in utilising plant that has had a very heavy level of investment,
it makes good business sense. So, if you were a Minister, you
would say, "Well, they would say that anyway, wouldn't they?"
In other words, let us go, and you are saying, "We mustn't
push the waste," I think, to quote what you have just said,
"down the waste hierarchy," your argument, it could
be put, if you were the Minister, is saying that "They really
do have a vested interest in making the largest possible return
from the biggest, most sophisticated investment, because that's
good for their shareholders." How do you counter that perhaps
oversimplistic but possible line of argument?
(Mr Hazell) I think, one of the great advantages this
Country has at the moment is that, compared with comparable European
countries, there is clearly a dearth of relevant infrastructure;
the hazardous waste treatment infrastructure in France and Germany
is a different order of magnitude from what we have in this country.
There is nothing in our industry, if not a shortage of competition
between the leading members of our industry to provide various
solutions. I think what I can honestly say to you is that, overwhelmingly,
the turnover in our sector is with a handful of companies that
operate in a number of jurisdictions, and they have a choice of
investing where they think they can earn a return, and there is
no real shortage in other countries of investment opportunities;
but, obviously, the British market is an important one. The key
response to your question, and I think it is honestly reflected
in everything ESA has been saying for years and years, is that
we want the Government to say, clearly, what sort of waste management
industry it wants us to have. And if the Government decides it
wants a low-investment outcome then our members will respond to
it, and they will provide the infrastructure; if the Government
instead says, "We want to be the best in Europe," we
will again try to deal with that. But we have had no real response
from the Government on the types of outcomes they want to achieve
from our industry; our members simply do not know where they are.
356. I am going to bring in Mr Tipping in just
a second, but I just want to conclude our opening exchanges by
seeking a point of clarification. When you said, in your first
substantive point, that you were concerned that the Government's
policy was pushing waste down the waste hierarchy, was, if you
like, the counterbalance to that position your observations about
mono-landfill and your judgement that hazardous wastes, in all
cases, needed a more sophisticated form of pre-treatment before
they were ultimately disposed into the revised landfill arrangements?
Were the two points linked? I just want to be clear I understand
those two points.
(Mr Hazell) They are, and they are not. The regulatory
system at the moment is tending to cause the existing infrastructure
for treatment of hazardous waste to close, or not to be used at
anything like full capacity, rather than to encourage a stream
of investment in new infrastructure. I am sure the Committee is
already aware that there has been a 40 per cent diminution in
the active high temperature incineration capacity since 1999;
one of our leading companies, Onyx, about half their treatment
works have closed, certainly within the last decade. Mr Meacher
spoke yesterday about fluorescent lighting; there is a company
in Manchester, they are not a member of ESA, Mercury Recycling,
they are not exactly overwhelmed with business. So the regulatory
system is not pushing, as it does in France and Germany, waste
treatment into the infrastructure that is being provided. The
point on treatment of the mono-landfills is really a different
one, and it is looking at what can be justified, given the context
of a Landfill Directive that requires designated hazardous waste
landfills and pre-treatment according to the standards of Waste
Acceptance Criteria; and, I emphasise, we still do not know what
those are, and, to deliver a result in years to come, we actually
need to know what they are today. And the difficulty with unstabilised
hazardous waste going into hazardous-only landfills is essentially
that it represents an environmental and an economic risk in perpetuity,
and that is very difficult to handle. Mrs Heasman can tell you
in great detail why we do not actually think the Environment Agency
will be able to licence those sorts of sites anyway, but I would
also make the point that our members are prudent businesses, they
need to insure their risk, and following 11 September there is
a noticeable increase in difficulty in getting access to capital
for insurance, and the cost of capital has risen, and the Financial
Services Authority is driving stricter rules for insurers properly
to look at risks. So I would put it to the Committee that probably
we could not even get insurance for those sorts of facilities
anyway; no realistic prospect of the Environment Agency ever giving
a release under the permit.
357. You have just indicated something that
could undermine the Government's approach. Mrs Heasman, would
you care to just possibly say a few words, at Mr Hazell's invitation,
because he says you can give us a little more detail, just so
that we can again fully appreciate the new dimension that he has
opened up about this matter?
(Ms Heasman) Certainly. The key change that everybody
is very alert to, I am sure, in this inquiry, is the move of hazardous
waste from the co-disposal system, where we had the benefits of
the chemical and biological reactions within domestic landfill
sites, and the stabilisation of the waste and degradation of the
waste that was achieved, and is achieved, to moving to put hazardous
waste into sites which are only for hazardous waste, and therefore
there are no ongoing, beneficial chemical reactions, biodegradation
reactions, to reduce the potential environmental liabilities associated
with those wastes. The only thing that is going to reduce them
in the long term is a gradual, slow washing-out of those contaminants,
and control of the leachate that is generated. The proposal in
the Landfill Directive is to set Acceptance Criteria, so there
are leaching limits, limits set for the leaching quality of those
wastes, before they can be placed in those landfills. The view
of the Environmental Services Association has always been that
they should be treated to Final Storage Quality, so far as is
possible; the Waste Acceptance Criteria that have been in the
past discussed, and up until about a week ago, with the draft
numbers that everybody thought were pretty likely to be the numbers
that were going to come in, are moving towards Final Storage Quality,
they are not Final Storage Quality but they are moving in that
direction. The main concern is the suggestion by Government that
the ban on co-disposal will come in in 2004, as specified in the
Landfill Directive, but the Waste Acceptance Criteria may not
come in until a date after 2004, possibly 2005, possibly 2006,
we do not know what that date will be. The particular point that
Mr Hazell was making is that in the period beyond 2004 there is
no possibility that wastes that are not treated to Final Storage
Quality, or those Acceptance Criteria, could possibly be accepted
at sites which will only accept hazardous waste, because of the
liabilities that will be presented, not only a decision on liabilities
presented to the owners of those sites but also in terms of the
liability to the groundwater. There is no way any groundwater
risk assessment for those types of waste would be able to demonstrate,
in accordance with the Groundwater Directive, that it was acceptable,
in terms of environmental risk. So there is a very real issue
that if the ban on co-disposal and the Waste Acceptance Criteria
are not brought in on the same date then there will be hazardous
waste with nowhere to go.
Mr Mitchell
358. What sort of quantities are you talking
about there?
(Ms Heasman) The majority of the hazardous waste at
the moment would not meet the Waste Acceptance Criteria without
some form of further treatment.
Paddy Tipping
359. You have talked to us about the billion
pounds a year, and it is clear to me that the ESA, and its constituent
companies, has got a vision of the way forward, which, to characterise
it, perhaps I have got this wrong, is higher cost, higher technology,
moving up the market. Now I think you were with us yesterday when
we talked to Mr Meacher about a waste strategy; what struck me,
and the Minister denied it, was the absence of a waste strategy
within DEFRA. Would you like to comment on the Government's Hazardous
Waste Strategy; what do you think it looks like?
(Mr Hazell) We would like to agree with you; and I
certainly do not wish to appear impertinent, Mr Chairman, but
we are very happy to give standard ESA corporate gifts to any
member of the Committee who can spot the strategy. We do not spot
a Hazardous Waste Strategy, and we have no idea; it is an intense
frustration to people like Gill Weeks, in companies like Cleanaway,
who want to move ahead and plan investment for the years ahead
for the leading companies. We have no idea what the Government
is planning. And I will tell you, to give you a feel for the climate
in which we operate; a few weeks ago, it was on 15 May, I was
summoned, at relatively short notice, to a meeting with Mr Meacher
and the Chemical Industry Association and the Environment Agency,
and at that meeting, and it was used as a debating point, it was
actually calculated to try to embarrass ESA, one of the two Agency
people there said the Waste Acceptance Criteria were already in
a draft form and had been made available to ESA, on the strength
of which our members could start investing. But since that meeting,
on 15 May, as Leslie and I have both intimated, the Waste Acceptance
Criteria have materially changed, the draft criteria have materially
changed. And you, as a Select Committee, would be entitled, in
years to come, if waste management companies started going bankrupt,
to question the wisdom of companies that invested in infrastructure
in an industry driven by regulation where those regulatory standards
were not stable and known. And that is the position we find ourselves
in; we desperately need a structure. The Chemical Industries Association
has asked for a forum; quite honestly, in the waste management
sector, we have so many fora, we have to sit around in these little
circles, improving people's learning curves and not really getting
anywhere. What we actually need is a strategy, and it is for the
Government to govern and to say what the strategy is and then
for the Environment Agency, as the regulator, to regulate it in
an even-handed and, actually, we want, strict way, we want strict
regulation; and it is incredible that an industry that is actually
saying, effectively, "tax us more, regulate us more,"
finds itself with the type of relationship that we have with the
regulator and, to an extent, the Government.
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