Waste from Electrical and Electronic Equipment

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Stephen Hesford (Wirral, West): Would I be correct in thinking that the Conservative party's position on recycling waste glass is that it should not take place unless and until a cost-benefit analysis has been carried out?

Mr. Hammond: I am not sure that the hon. Gentleman is correct to put the point in quite that way, but costs and benefits are important. I simply said that I suspect that the act of delivering glass to the recycling point by car means that no net environmental benefit will be produced. Obviously, such issues are complex.

There is also a finite amount of financial resources available to deal with recycling and environmental problems. Many of the people who promote so-called environmental solutions sometimes do not want to talk about the financial costs and benefits. Given that we have a finite amount of wealth that we are prepared to devote to improving the environment, I would like a more rigorous approach in which we say, ''Let us use the money that is available. Let us take the hit that we are prepared to take in the most beneficial way so that we achieve the largest possible environmental benefit for every pound spent.''

Will the Minister clarify a point that he touched on during questions in relation to where producer responsibility commences? If I have correctly interpreted what he said, there will be a mandatory requirement for producers to be responsible for the costs from a central collection point and member states will be able to impose costs on producers further upstream—the cost of local authority collection, for example. If that is so, will the Minister define ''central collection point''?

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Clearly, there will be a significant difference in the burden of cost imposed on producers depending on whether the central collection point is the local recycling centre in each community or the regional centre to which local authorities deliver their waste. Or does it mean the designated receiving centre for each producer, where the designated agent will deliver the waste for which the producer is responsible?

If local authorities are to play a constructive role in the process, does the Minister accept that the capacity of local authority contractors will need to be significantly increased to handle and process the amount of waste?

Can the Minister confirm that the Government are seeking a minimally bureaucratic system, and that we will not get into the same red tape nightmare that we have with packaging waste and the producer responsibility note system, in which the cost of the effort of doing the thing almost certainly outweighs the benefit delivered? Or will the Minister opt for a market-oriented situation in which we have the minimum amount of bureaucratic involvement to meet the end objective? Does he recognise that there is not a single electronic and electrical equipment industry, but that different subsectors of the industry that make different products face many different situations? It would be inappropriate to allow a single regime to apply across the board.

I hope that the Minister can reassure the Committee that the directive will have sufficient scope for different interpretations and regimes to be imposed on different parts of the industry, as appropriate to the situation in the United Kingdom. Will he assure us that the Government intend to recognise the wide range of goods covered by the directive and the wide range of collection and recovery mechanisms that will be appropriate?

I asked the Minister about the Greek and Irish derogation. He was not able to answer at the time, but inspiration might have arrived by the time that he responds to the debate.

I anticipate that the Minister will say something about the UK's state of readiness to deal with the directive. We already reprocess a substantial amount of electrical and electronic equipment waste, but if the directive is to have a positive effect, the amount should increase. The Minister says that the situation is not like the fridges fiasco because we have reprocessing capability. It would be good to have an assurance of that on the record, if only so that I can wave it at him when, and if, a polychlorinated biphenyl—PCB—mountain arrives in my, or anyone else's, constituency.

Will the Minister explain further how the proposed regime will affect medical equipment and medical electronic products? I was involved in that field for many years before I came to the House, so it is—unusually—something that I might know a little about. I believe that contaminated products will be excluded from the recovery regime. That is significant because medical practice is moving toward using more disposable products, although the UK has lagged behind many of our EU partners in moving from reusable to disposable products. Significant numbers

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of medical electronic disposable products are used every year and they cause much waste.

One figure springs to mind. In 1990, I estimated that the European Union was using between 300 and 400 million disposable cardiac electrodes each year. I assume that they would be classed as bio-contaminated waste because they have been in contact with patients' skin, although they are not used invasively, and that such products would be excluded from the scope of the directive and would continue to be disposed of in landfill or, more likely, by incineration as moderately contaminated waste.

Will the Minister explain how the regime on medical electronic products will work? Has an estimate been made of the cost to the national health service of compliance with the spirit of the directive?

Dr. Ladyman: When the hon. Gentleman's local Conservative council decides to build an incinerator in the working-class parts of his constituency alongside the landfill site that it has already dumped there, one of his constituents' worries will be the production of dioxins from the incinerator. The components about which he talked are made of such things as copper, which is a catalyst when burned. Does he agree that if the equipment is incinerated, it will produce dioxins? Whether or not we include such equipment in the directive, we must find a mechanism to get them out of the incineration stream.

Mr. Hammond: The hon. Gentleman is right. His knowledge of the machinations of local government is not perfect; if he thinks about it he will realise that county councils are responsible for waste disposal and decisions about incinerators. He may not be aware that that is a live issue in Surrey, where the construction of an incinerator is actively being considered.

The hon. Gentleman is absolutely right to say that there is a great deal of public concern about incineration—some of it, I suspect, misplaced. Some years ago, I visited an incinerator close to the airport in Toronto. Canada has extremely tight environmental laws, and the incinerator operated under a good system. It gave an online analysis of the emissions, and had a display screen in the city hall in downtown Toronto. Any concerned citizen could go in and see, on a real-time basis, what the incinerator was chucking out. I understand that that led to a lessening of public concern about such issues. However, the hon. Gentleman is right that there is a debate to be had about the safety of incineration, and that we must reassure the public about it.

On an important matter of policy, the Minister said that the UK was battling for the flexibility to adopt common responsibility for the cost of recovery and reprocessing, rather than individual producer responsibility for own products. The European Parliament has sought to mandate that individual producers should be responsible for their products only. The thinking behind that, which seems logical to me, is that only then do we give individual producers an incentive to design easy-to-recycle, environmentally friendly products. If we lump together the good, the bad and the ugly and average out the cost, we remove

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any incentive for good practice in a fragmented and diverse industry.

If the Minister is saying that the UK's preference is for a collective cost-sharing approach, I should like him to explain why he thinks that that will deliver maximum environmental benefit. A major international electronics company based in my constituency has expressed the clear view that that would be a negative factor for environmentally responsible companies such as itself. It strongly advocates, as do several of the industry associations, that the Government consider a product-specific or manufacturer-specific system of cost responsibility.

I should like to ask the Minister about securities for future costs of disposals. My hon. Friend the Member for East Devon (Mr. Swire) mentioned orphan products, which arise when the original producer—or, more likely, a relatively insubstantial original importer—goes out of business or has disappeared by the time that the product comes to be recycled. Several options have been considered, including bonds for future costs and blocked cash accounts.

The Minister, when wearing one of his other hats, is responsible for oil and gas in the North sea. He knows that security for decommissioning costs—a similar sort of issue—is a major topic in respect of the North sea. Such costs affect small and large companies differently, and I suspect that that will also be true for the waste electrical and electronic equipment issue. Large companies will probably be able to carry the burden on their balance sheet.

Large companies will not find it particularly expensive or onerous if the Government insist on bonds being put in place or letters of credit being raised, because the strength of their balance sheet makes the risk taken on by the institution that provides the bond or the letter of credit relatively small. It will be a very significant burden to small companies. Has the Minister made a detailed appraisal of the likely impacts on companies of different sizes of the different methodologies that are proposed for providing security for costs? Of all the aspects of the directive, this one will probably do the most damage to small and medium enterprises, and it may be too much of a burden for some companies—the cost will be too much for their balance sheet to bear.

I understand that the current version of the text makes all producers collectively responsible for orphan waste. That is a pragmatic way of proceeding, but it is also questionable. It would be more appropriate if the state were to accept responsibility for orphan waste—waste for which there is no security in place for disposal costs. Those costs should be borne by taxpayers in general, rather than by responsible manufacturers who have put in place the necessary bonding and are dealing with their own products.

If the terms of the final directive permit them to do so, will the British Government allow the imposition of a visible fee in respect of the cost of dealing with the historic workstation for electronic computer equipments—I am unsure what else to call it, as we

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referred to the historic car park for vehicles when the end of life vehicles directive was discussed.

I turn to the role of refurbishment for resale in the overall process of dealing with electronic and electrical equipment waste. On the face of it, the most attractive way to recycle this kind of waste is for it to be refurbished and reused. I walked to the Committee with the hon. Member for South Thanet, and on the way I mentioned to him an organisation in my constituency—the Whip is on to that. I am sure that there are such organisations in many other hon. Member's constituencies. It collects computers from businesses, which typically dispose of them on a two-year cycle. It then refurbishes them, and upgrades them if that is necessary, and distributes them free of charge to schools and charities. It has been very successful, because it has managed to persuade many businesses not only to give them their computers, but to give them money to upgrade, clean and recycle them. That is a useful initiative, because it gives those computers a further two or three years of useful life—and at the end of that period, the same companies will be getting ready to throw out another set of computers.

Much electrical and electronic equipment—particularly household white goods—is refurbished and exported abroad. Sometimes it is not refurbished; it is just exported for reuse in third world countries, or in eastern Europe. Is the Minister concerned that the export of such equipment creates a potential loophole in the reprocessing procedures and obligations? If a piece of equipment is exported from the EU at the end of its useful EU life, in most cases it will subsequently not be reprocessed or subject to the kind of recovery procedures that we have been talking about. It will slip through the net. Is that a worry for the Government? Shall we be exporting a problem? Is the Minister bothered that there may be a loophole? Does he not see the possibility that unscrupulous operators would purport to export products that were, in fact, being removed outside the European Union for dumping? That is not a new problem, but it may be exacerbated by the directive. I hope that the hon. Gentleman is listening to me because I shall want specific answers to my questions.

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Prepared 17 July 2002