APPENDIX 18
Memorandum submitted by Biffa Waste Services
Ltd (G23)
Thank you for the opportunity to respond to
your enquiry into the role of DEFRA.
Biffa Waste Services is the largest waste management
company operating in the UK—it is the largest wholly British-owned
waste management company and can justifiably claim to be the most
diverse in terms of its spread of interest in industrial/commercial
and domestic collection, landfill, liquid waste stream and specialist
hazardous waste management systems. The company has a turnover
of around £450 million at a current annualised rate and is
also in the top three waste management companies operating in
Belgium. We are owned wholly by Severn Trent Plc with over 110
operating centres throughout the UK. We handle 12 million tonnes
of material which is treated, landfilled or recycled on behalf
of an extensive customer base exceeding 65,000 in the public,
commercial and industrial sectors.
Our response pertains to the vision set out
by the Department and its achievement and touches on whether the
Department is engineered to deliver its objectives. The key points
we would make in response are:
(i) when the strategy and mission statements
were released we expressed our misgivings to DEFRA with specific
reference to the low priority they appear to be giving to the
broader canvas of sustainability issues, preferring to confine
themselves to narrower fields which related specifically to food
and agriculture. The seven objectives proposed were excessive
and reflected in our view, the woolly thinking used to develop
higher level objectives. Our three objectives designed to cover
the three core elements of sustainability were proposed as:
Objective 1—modify to "To improve
the UK environment in terms of biodiversity, air and water quality,
and resource efficiency by integrating these with policies across
central, local, devolved and international government".
Objective 2—to enhance opportunity and
tackle social exclusion in the countryside by leading the development
of a dynamic, accessible, inclusive and sustainable economy in
rural areas, which does not compromise opportunity or rural services.
Objective 3—to promote a sustainable and
economically competitive food supply chain which meets consumers'
requirements without compromising sustainable management in the
meat and dairy, cereal, fodder and fisheries sectors, human health
or internationally defined standards of animal welfare.
Our detailed reasoning around the need for this
sharper focus was contained in our letter of 24 September 2001
to Mr Dixon as part of the DEFRA consultation process and this
is appended to this submission since it encapsulates areas which
we continue to feel have not been addressed and are therefore
highly pertinent to your current enquiry.
(ii) Subsequent events have shown that despite
an initial flurry of consultation around the waste strategy, DEFRA
appears to see itself merely as some form of modernised Department
of Agriculture. Its approach to waste, resource efficiency, waste-linked
energy issues, the carbon economy and the framework of budgetary
or fiscal instruments necessary to drive the process have been
abrogated by Cabinet Office/PIU studies or a lack of preparedness
in the Treasury to discuss how the waste strategy can be delivered.
(iii) Regional Assembly/Governmental liaison.
Understandably Scotland and Wales wish to exercise regional autonomy
in the context of their local circumstances but it is unfortunate
that DEFRA has been unable to encourage wider uniformity in implementation
of underlying standards. This is particularly important with regards
to waste—where unscrupulous operators will exploit such
loopholes to their advantages by moving material about. Further
examples of lack of co-ordination were revealed with the packaging
regulations—perhaps DEFRA should be given more support for
acting as a lead body.
(iv) The ratio of departmental costs to sectoral
activity is lopsided. The turnover of the food and allied sectors
in UK GDP is:
| Manufacture | £17 billion
|
| Distribution | £17 billion
|
| Catering | £12 billion
|
| Agriculture | £6.4 billion
|
| Fisheries | £0.5 billion
|
The creation of the Food Standards Authority (FSA) covers
some ex MAFF functions closer to manufacture, distribution and
catering yet DEFRA appears to have a departmental expenditure
limit (DEL) of £1.4 billion and an annual managed expenditure
(AME) of £2.1 billion. This equates to administrative expenditure
for a department that still sees itself very much linked to agriculture
(rather than rural affairs) costing £1 for every £2
of sector turnover. The turnover of the direct waste industry
in the UK (£4.5 billion) coupled to associated consultancy
and environmental services/technologies amounts in total to at
least £8 billion per annum yet the internal manning and resources
given to the waste area represent a relatively small proportion
of overall departmental expenditure. We are not aware of the precise
figure since the last published data relates to the old DETR but
is unlikely to amount to more than £0.4 billion.
(v) There has been a failure to align policy and regulation.
There are a number of examples (not least fridges) where it is
clear that the linkage between authority and responsibility for
the transposition of EU environmental legislation is at some point
dysfunctional between DEFRA, DTI and the Environment Agency. Different
departments have different lead body status (DTI for electricals
but DEFRA for global warming and ozone depletion) where policy
falls between the cracks. Even when that is resolved the Environment
Agency is not integrated into the process sufficiently early with
a result that the necessary process technology, operating standards
and enforcement regimes are not ready at the appropriate time.
Fridges were the worst example of this because they were subject
to a regulation with an absolute date of application—but
they revealed the tip of an iceberg when it came to the landfill,
end life vehicles and other directives where transposition is
subject to blurry boundaries which end up being decided on the
altar of inter departmental blame shifting.
(vi) DEFRA could have done much more in creating a healthy
investment framework for new technologies working in conjunction
with the Environment Agency. The Environment Agency should be
far more outcomes focused—defining absolute levels of emissions
based on scientific credibility, practical deliverability and
the implications for UK competitiveness in terms of standards
applying elsewhere in Europe. In effect we have standardised European
directives emerging but differentiated levels of enforcement or
agreement on transboundary operating standards. DEFRA could have
done far more at a European political level to develop a strategic
framework on internal compliance standards.
(vii) DEFRA needs to be the single mouthpiece for environmental
policy and implementation if it is genuinely the lead Government
body. The reality is that the Environment Agency acts both as
a regulator and an advisory body on everything from best technological
solutions through to deciding on its preferred mix of regional
waste strategies. In many of these areas the EA are extremely
proficient—the problem is that they are first and foremost
a regulator and DEFRA should decide whether the advisory functions
are best reversed back into its own province and rebranded along
similar lines to the US Environmental Protection Agency Advisory
Group. Without doubt the EA are probably seen as a better repository
of the public interest by the public as a whole than DEFRA in
London—not helped by the fact that DEFRA have lost many
key staff in this latter area (and presumably the financial resources
that such a function demands). It is up to the Minister to resolve
this dilemma.
(viii) DEFRA has clearly experienced severe problems in
sending clear messages to the Treasury regarding the delivery
of the waste strategy. Funding appears to have been made available
in abundance—from the New Opportunities Fund, recycling
grants, environmental improvement grants and Landfill Tax Credits—on
a day-to-day basis but DEFRA does not appear to have engaged the
Treasury at a higher level in the need for an interaction of policy
between budgetary, fiscal and regulatory instruments to develop
an integrated sectoral framework for joined up thinking on delivering
the waste strategy. Specifically there could have been much more
cohesion with regard to increasing waste disposal taxes (particularly
the Landfill Tax) and Integrated Product Policy (IPP). For years
we have contended that a Landfill Tax level of £35 per tonne
plus coupled to full Producer Responsibility (with first year
costs rebated to specific companies for accepting IPP via reductions
in NICs (National Insurance Contributions), Corporation Tax or
similar measures).
We accept that such innovative linkages between the half
of the Treasury that raises money and the other half that dispenses
it may be a trifle naïve at this stage in the proceedings
but at the very last we would have looked to DEFRA to develop
the debate for this sort of "top down" thinking.
(ix) DEFRA fails to see waste in the context of solutions
for agriculture. Currently around 85 per cent of controlled waste
is disposed of into landfill. Within 20 years DEFRA's own waste
policy calls for that to be reduced to 25 per cent or less. The
alternative exit routes for these materials (assuming waste production
levels continue at the current levels) will be composting, recycling
and energy. In the first and third sectors the interaction with
agricultural bio systems is obvious—first as a source of
material supply (manufactured soils) and secondly as an exit route
for by-products (animal effluent, animal remains, straws, packaging
and similar materials to gasification/energy processes). Yet this
important exit route is now mired in confusion as a result of
action by the EA to invoke the Animal By-products Regulations
without consultation, reason or rational science.
(x) DEFRA could do more to champion the case for a national
integrated framework for resource flow measurement in the economy.
Currently Biffaward, our Landfill Tax Credit Scheme, has committed
around £8 million to the development of 50 million-odd studies
into resource flows in specific geographic, material stream and
economic sectors. The co-operation from DEFRA on this project
and the Environment Agency has been positive but we would like
to see a more strategic debate pushed forward by Government (rather
than us!) which decides how this framework should evolve as an
issue of national strategic importance (or not as the case may
be!).
(xi) DEFRA is sending mixed signals with regard to e-Government
(e-gov at local as well as central). In the submissions we have
seen, DEFRA appear to be quite complacent—not referring
to there being a problem or to the fact that the necessary solutions
entail. We find this quite surprising on the basis that the absence
of accurate statistics—certainly with regard to municipal
waste arisings—is constantly referred to in the waste strategy.
Either this suggests that the shortcomings in the waste side have
been ignored (in what is possibly an e-literate agricultural sector)
or someone is unaware of the issues. It is for this reason that
we are proposing to apply Landfill Tax money to a nationally integrated
solution for a relational database on municipal waste flows from
production through to end disposal and present this to DEFRA as
a model. Nevertheless there needs to be more overt linkage communicated
to the private sector with regard to the interconnectivity between
such a database and (for instance) the NHS (with regard to domiciliary
discharges from hospitals) to determine accurate assessments of
clinical waste arisings or between other installed infrastructures
such as LASER, NLIS, NLPG (systems which are seen as the emergent
repositories for data on household locations and ownership) for
waste scheduling and recovery, contaminated land and so forth.
As a major operator in the municipal waste collection business
we would welcome sectoral dialogue on how the Government Gateway
might require us to modify our own IT approaches with regard to
access, security, message transmission, data routing and similar
information flows.
(xii) DEFRA and knowledge exchange. DEFRA should take
a lead in this. In line with recent recommendations from the Chairman
of the appropriate think tank—David Arculus—we commend
to DEFRA the benefit of people exchange between them and industry.
The Environment Agency have been keen to initiate such processes
(clearly on a basis where neither party feels compromised and
we would be keen to support similar initiatives if asked).
The above comments represent interim observations at DEFRA's
first anniversary—but we feel that had the focus suggested
in the attached letter been listened to we might have been a little
less critical in our observations.
27 May 2002
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