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20 Mar 2003 : Column 1132—continued

Mr. Meacher: The target or trip points were laid down in the landfill directive and are not a matter for the UK to determine. We are making it clear to local authorities that they can trade across years, but that they cannot trade across target years. That might put the achievement of our targets at risk. We are making that clear, and we shall make it clear in guidance. It would not be possible to do what the hon. Gentleman suggests partly because of the directive and partly because the framework in which we have to meet it is laid down for us. It is not a matter for our discretion.

Municipal waste is growing at 3 to 4 per cent. a year, with recycling increasing only at 1 per cent. a year. That is another indication of the challenge that faces us on the alternative to landfill. Therefore, we are still landfilling more biodegradable municipal waste than ever and, each year, we are getting further from achieving our legally binding targets. I make no attempt to hide the seriousness of the challenge that we face.

The landfill directive targets and, therefore, the Bill concentrate on the biodegradable municipal waste that is the direct concern of local government. Biodegradable waste represents about 63 per cent. of all municipal waste and is a cause for concern due its very nature. Methane is produced as a by-product of both aerobic and anaerobic decomposition, which means that the waste rots either with or without the presence of oxygen. This branch of the waste stream includes paper and cardboard, food and garden waste and natural textiles. That forms a very large proportion of the household waste stream. The aim of our sustainable waste management policies is to move these wastes up the waste hierarchy and towards their reduction, reuse, recycling or recovery and away from simply dumping them in landfills.

We recognise the scale of the challenge and the large investment in alternatives to landfill that are required. The changes in the way in which we manage our waste create obligations on us all as producers of waste. We all continue to create waste. However, as the targets relate to municipal waste under the directive, we have to look to those who manage and control this waste—that is, the local authorities—to achieve compliance. That is why the landfill allowances relate to local authorities—this is the point that my hon. Friend the Member for Normanton (Mr. O'Brien) raised—and specifically to the waste disposal authorities that dispose of the waste to landfill.

Joan Ruddock (Lewisham, Deptford): My right hon. Friend is talking a great deal about the responsibilities

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of local authorities, and we all appreciate them. The position is getting more complicated by the moment and local authorities have more to do. Does he agree that if they were to have a statutory responsibility to develop a waste strategy, that would help them to manage all their new responsibilities and the complexities that exist in dealing with waste?

Mr. Meacher: My hon. Friend makes a point that is directly relevant to her Municipal Waste Recycling Bill which received its Second Reading last Thursday. [Hon. Members: "Friday."] I beg the House's pardon. My hon. Friend makes an important point. She will know that the issue arose in another place and that an amendment to the Bill was accepted that requires local authorities to set out statutorily their waste management strategies. That is the basis on which the Bill comes before the House. In the light of the fact that the Government opposed the amendment but lost in another place, we are reconsidering the issue. We shall return to the House with our conclusions. I am very much aware that this point applies to my hon. Friend's Bill.

Mr. David Drew (Stroud): My right hon. Friend has been characteristically generous in giving way. Perhaps we will discuss the Bill in interventions, so that we will not need much of a debate later. Surely, we must put the onus on to local authorities. However, as my right hon. Friend and my hon. Friend the Member for Lewisham, Deptford (Joan Ruddock) said in relation to her Bill, the onus must also be placed on the individual. We cannot beat about the bush. We must make it clear that local authorities must charge according to the amount of waste produced by individual households. People will then start to learn that they must recycle, not just for some sort of spiritual reason but out of sheer economic necessity. Should we not move towards such an approach?

Mr. Meacher: The strategy unit's report "Waste Not, Want Not" recommended that the Government consider the proposal that my hon. Friend mentioned. Contrary to what many people think, the system sometimes known as variable charging does not constitute a double whammy in the council tax. It is not an addition to the element in the council that is chargeable for waste collection, but replaces it. As he said, it depends on the amount of waste that a household generates. I entirely understand his point about the need to incentivise people to try to create less waste. The Government are considering the issue in their response to the strategy unit report. We will give our formal response to all the elements in the report quite soon.

Paddy Tipping (Sherwood): Will my right hon. Friend give way?

Mr. Meacher: I will give way, but I wonder whether anyone will have time to make a speech.

Paddy Tipping: My right hon. Friend has referred to the amendment made in another place. Composting has an important place in our strategy, so will he carefully consider that amendment and examine carefully the

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advice given by bodies, such as the Composting Association, so that we ensure that composting takes place and is not prevented?

Mr. Meacher: Composting is unquestionably very important, and the Government are very keen to promote composting of a high standard. However, clause 22, which deals with the definition of composting, was introduced in another place and, again, it was carried although the Government opposed it. I am advised that it includes requirements for the treatment of waste containing animal products into compost that would, in practice, turn the compost into sludge and render it useless as compost. We will obviously take account of what my hon. Friend has said and consider the issue further, but we must be extremely careful to retain a definition of compost that makes sense and, at the end of the process, does not simply lead to more biodegradable waste going to landfill.

Those hon. Members who have followed the issue closely will know that we proposed a permit system when we consulted. I do not wish to deceive anyone, so I should say that we have changed that term to "allowances" for legal clarity because landfill sites are also subject to pollution prevention and control permits, and we have therefore decided to use another term.

Part 1 will give the Secretary of State the power to specify the maximum amounts of biodegradable waste that can be sent to landfill sites in each of the four countries of the United Kingdom. She must do so after consulting their Administrations, and that must be done for each target year in the landfill directive. For the interim non-target years, she may set limits in each country, or a default formula can be used. The default would ensure an even profile of reduction, thus helping the UK to meet the targets.

After that initial division, responsibility for setting up and operating an allowance scheme rests with each country, obviously because environmental policy is a devolved matter. So the purpose of the Bill is to set the framework, with the detail being decided by each country. Each country will have the flexibility to produce its own scheme and details will be set in regulations. Each country will also have to decide whether to permit trading in its area. Those countries that decide to allow trading could then become part of a cross-border scheme. I can confirm that England intends to introduce a trading scheme and would be prepared to take part in cross-border trading if others wished to do so.

As the Bill provides flexibility for the detail of the trading scheme, it could be somewhat different in each country within the broad legal framework. For example, some Administrations may decide that allowances can be borrowed over years—others will not—but no country can allow such borrowing across target years, as that would put at risk the UK targets. The hon. Member for Angus (Mr. Weir) raised that issue a little while ago.

There will be an absolute duty on each waste disposal authority not to exceed the allowances that it holds irrespective of whether they were acquired by direct allocation or as a result of trading, banking or borrowing. However, local authorities will not be obliged to trade; they may simply landfill within their allotted allocation. Equally, there will be no requirement to trade for a monetary value—a simple transfer is permitted.

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As trading under the landfill allowances scheme would involve public bodies and there is no intention for that to become a speculative market, the Bill will not allow third parties to hold or trade allowances for a number of reasons. We want to provide opportunities for local authorities to trade any surplus. The targets are already very challenging for the UK, so we do not want allowances removed from the system. We do not want waste companies to purchase allowances and to use them, for example, to determine the procurement of local authority waste contracts.

Each waste disposal authority will receive an allowance, which is the maximum amount of biodegradable waste that it can landfill in a year. The intention in England is to allocate allowances for each year from 2016 to 2020. Local authorities can then plan their progressive diversion from landfill. However, we recognise that the position can change over 16 years, because we make better progress towards meeting the directive targets than we envisage at present, so the Bill contains a provision to revise the allocations if that proves necessary or helpful.

If a waste disposal authority landfills more biodegradable municipal waste than the allowances it holds, it will be liable to civil financial penalty. The penalties will be set at a sufficient level to ensure that the local authority has the incentive to divert from landfill or acquire allowances, rather than breach the limits. That is obviously essential to secure the landfill directive targets and to underpin an effective trading market.

The landfill allowance schemes will be monitored by the monitoring authorities appointed for each country, and we expect those to be the respective environmental regulators. That will minimise the burden on landfill operators because the environmental regulators are already responsible—I understand that, in Northern Ireland, they soon will be—for regulating landfills and collecting information from their operators and local authorities. Where trading is permitted, it is intended that the monitoring authorities will also be responsible for recording each trading transfer on a central register.

The aim, however, is to encourage local authorities to meet their targets in a sensible and co-ordinated way, not to take away resources without justification. Obviously, we do not wish to do that. That is why there is provision for the allocating authorities to extend the time for paying or to relieve liability to penalties if, for example, the local authority that has breached its allowances has a strategy in place to bring itself back on track.

The importance of the target years is recognised by the provision for supplementary penalties in those years where a local authority landfilling more than it is permitted could lead to the UK breaching its legal obligations under the landfill directive, possibly becoming subject to a European Court of Justice fine. That reflects the seriousness with which we take our international obligations and—let me be frank—the possible penalties of up to £180 million a year for breaching the directive targets.

The constituent countries of the UK will be responsible for meeting their share of the UK targets and for any associated financial costs or penalties by means of a concordat. There will also be criminal offences for landfill operators who fail to comply with

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the requirements of regulations, and there may be offences for a breach of scheme regulations, such as restrictions on banking or borrowing. There are also penalties in relation to the details of the scheme, such as record keeping or the rules for saving allowances.

In another place, concern was expressed that the duty to reduce landfill was placed on waste disposal authorities when some of the means of delivering the targets, such as the collection systems that facilitate recycling—my hon. Friend the Member for Stroud (Mr. Drew) made this point a little earlier—are in the hands of the waste collection authorities. Of course, that only presents a problem in two-tier authorities. We expect that the authorities will plan together to achieve targets. However, where that is not the case, we will provide a power for waste disposal authorities to issue a direction to collection authorities on the manner in which waste is delivered for disposal, so it can be delivered in a form that facilitates recycling.

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