Examination of Witnesses (Questions 160-179)
DR JANE
BEASLEY AND
MR CHRIS
MURPHY
WEDNESDAY 22 JANUARY 2003
160. But all on a voluntary basis?
(Mr Murphy) I think there probably is a role for producer
responsibility. It will be interesting to see what comes out of
the End of Life Vehicles Directive with some sort of levy on the
purchase of the product at the start of its life which is carried
on through the life of that item, that is particularly relevant
for vehicles and then at the end of life that levy is cashed in,
which is the appropriate disposal or treatment of the vehicle.
That is appropriate for vehicles at the present time because we
have an awful lot of abandoned cars. So that sort of levy down
the chain would work out well.
Mr Francois
161. Imagine for a moment that you were to bring
in mandatory environmental reporting for companies, which is something
that some people have argued for, what level of improvement in
terms of waste prevention, minimalisation and recycling would
occur if that step was to be taken?
(Dr Beasley) I think what you would see initially
as a result is improved housekeeping. Then you would have better
practices in terms of resource usage and resource flow because
there would be an increased awareness of the waste that was being
generated by the organisation which perhaps has been lacking.
If you are enforcing environmental reporting then you are actually
getting a company to look at its performance, but it is in the
subsequent years when you would expect them to improve upon that
performance, when you would see greater activity in terms of looking
at resource flows which hopefully would lead to improved waste
minimisation and in-house practices in terms of in-house recycling
and then possibly looking for better markets for the recycling
of their products. It has been demonstrated in some sectors that
this has been achieved. The larger corporations with a bigger
starting point in terms of the amount of waste they are producing
are seeing the largest benefits initially, but it is an area where
with increased awareness the company can move things forward and
bench mark.
162. Even if you were to take that step, how
would you see the SMEs applying this principle, ie those who are
not publicly quoted and who are not producing glossy annual reports
in a sense?
(Dr Beasley) I would certainly avoid this approach
with SMEs at the outset purely because they do not have the expertise
to put forward an effective environmental report. There would
be a different way of tackling SMEs. There are existing routes
out there with regard to organisations such as Envirowise and
promoting better practice in-house for SMEs and really giving
them the opportunity to look at guidelines, looking at the best
practice out there and implementing their own strategies. Generally
speaking it has not been enforced on SMEs in other areas and it
would not be the most appropriate route for ourselves either.
163. Part of this whole debate is that businesses
across all sorts of ranges of size are having to face more and
more regulation of one type or another. No matter how environmentally
worthy this might be in principle, it would represent an additional
regulatory burden particularly for smaller companies who have
less staff to deal with, whatever it is they have to deal with.
What would be your response to that?
(Dr Beasley) The one potential benefit if you were
enforcing environmental reporting on the larger companies or even
medium-size companies would be their liability, their own insurance
in terms of environmental insurance. Something that the Environment
Agency is looking into would be the strong arm of regulation upon
them which would perhaps not be the same if they can demonstrate
through an environmental report that they have an environmental
system in place and they are following it and showing improvement.
So there could be benefits in the longer term from the regulatory
perspective because they are demonstrating that good practice
and if the agency could follow through on how the two can tally
up it could be of benefit.
164. There is a lot of evidence to show that
companies like having directors who have financial and accounting
backgrounds. Is there any evidence that companies are beginning
to look towards directors who have an environmental background
or any expertise in that area when they are trying to pick directors
of firms?
(Dr Beasley) There seems to be a trend towards it
on some of the more high profile companies that potentially have
more of an environmental impact and they are looking more at broadening
their expertise in terms of having a stronger environmental background
for the whole company with regard to whether it is the chemical
industry, your own sector, that sort of thing, where they are
much more high profile and they are ahead of the game in one sense
in terms of incorporating staff that have that expertise and going
down the environmental reporting route.
165. The waste strategy asserted that the Government
expect the amount of industrial and commercial waste being sent
to landfill to be reduced from about 42 million tonnes in 1998
to 36 million tonnes by 2005. Are you confident they will reach
that target?
(Dr Beasley) There are so many drivers, the Landfill
Tax being one of them and yes, we have already stated it is too
low to have an immediate impact. Companies are looking towards
minimising their costs in all areas and waste does cost them money.
I do not really have the confidence to turn round and say I think
they could achieve that diversion without having all of the other
factors in place, like an increased Landfill Tax, that type of
thing, but we are seeing a decline in the amount of material going
into landfill. At what rate, I do not know, I would not be so
confident as to say what it would be.
166. Do you think there is any point in putting
incremental targets in between now and 2005?
(Dr Beasley) For industrial and commercial waste streams?
167. Yes.
(Dr Beasley) I think a difficulty with commercial
and industrial waste streams is data discrepancies as to what
the true picture is and if you are putting incremental targets
in and you are not totally sure about the baseline data and the
clarity of the data certainly is not there you could get into
difficulties in trying to prove or disprove those targets. I think
at the moment we need to look at improving our data collection,
at improving the methodology for data collection to try and ensure
that there is consistency there so that we know what baseline
we are working against. Then we can decide whether we need to
move towards statutory targets.
168. Would that argument also apply to targets
post-2005?
(Dr Beasley) Yes.
(Mr Murphy) As far as the larger companies are concerned,
there is evidence that there is a commercial advantage to expressing
your Green credentials through an environmental management scheme
and also the lighter regulation which the Environment Agency are
looking at coordinating with existing regulatory and enforcement
powers. There are advantages to doing this outside of fulfilling
mandatory EMS requirements. As far as the smaller companies are
concerned, you are right, it is regulation on top of already burdensome
regulation and probably mandatory reporting would not be appropriate.
169. For small and medium companies?
(Mr Murphy) Yes.
Chairman
170. How big a part of the problem are the SMEs?
(Mr Murphy) A larger proportion in terms of the companies
and probably business in the UK.
171. In terms of producing waste, are they the
biggest proportion?
(Mr Murphy) I would say so, yes. They are the largest
proportion of waste producing companies.
172. More than 50% of the waste is produced
by SMEs?
(Mr Murphy) It is more than 50%, yes. Their primary
concern is the bottom-line existence and complying with regulations
which have more teeth, health and safety regulations, for example,
rather than environmental.
Mr Challen
173. Are any of the SMEs working co-operatively
together so they create a critical mass to deal with these problems
rather than just assuming that there is a regulatory burden, they
cannot handle it, so they just criticise the Government?
(Mr Murphy) Yes. They are working together through
local commercial development but also through organisations like
Envirowise, which is DTI funded, and organisations like ourselves
are looking to educate and train small and medium businesses as
well.
(Dr Beasley) There are things like waste minimisation
clubs which are SME founded.
174. Could you say something about the penetration
of these clubs. Are they picking up now or are they just bumping
along with a few enthusiasts trying to pull things together?
(Dr Beasley) There are about 100 waste minimisation
clubs in operation. The general feeling as far as Envirowise is
concerned, who are really driving this initiative forward, is
that they cannot really identify specific trends in terms of the
type of companies that might necessarily go towards these clubs,
but it does rely on very committed individuals setting clubs up,
running the clubs, lobbying for the clubs, that type of thing
rather than a very co-ordinated effort centrally, which is quite
lacking. Some areas are demonstrating very very good practice
in terms of their waste minimisation clubs that have been around
for some time, they have a vast membership, they disseminate information
effectively amongst themselves whereas in others it is quite lacking.
175. Do you think they should have more support
from the Government or is it just another market-led initiative?
(Dr Beasley) I think Envirowise certainly could do
with some more support centrally in terms of disseminating this
and setting it up as a framework for the clubs to follow. At the
moment it is ad hoc and it does rely on the individuals. There
needs to be some central support for it both in terms of promotion
of what is going on because companies are not necessarily aware
of these activities, not just the clubs but the work of Envirowise,
the access to free information they can have, the access to free
expertise they can have, they can have site visits and they are
not necessarily aware of this, so there does need to be some kind
of campaign and Envirowise does not have the funds for that so
it would be looking for extra support.
Mr Ainsworth
176. I was going to ask about the level of awareness
of Envirowise amongst your members. It does seem to me that if
you are turning your back on mandatory regulation for smaller
companies, for obvious reasons, we are left with a huge responsibility
for organisations like Envirowise because if it is true that 50%
or more of all waste comes from smaller companies—I would
be interested to know where you got your figures from, I appreciate
you do not have them here but if you could name a source or whether
they are your own figures—there is a huge burden of responsibility
without the backing of new regulation on the industry to sort
out its own problems. I am just not sure how well this is going
to work. If mandatory obligations only apply to the larger companies
which are perhaps producing less than 50% of the waste and are
by and large compliant anyway with good practice because they
have learned that is the best way for them for the bottom line,
is Envirowise enough?
(Dr Beasley) That is a very good question. The evidence
of the success of Envirowise to date is such that when it does
become involved it does have a dramatic effect in terms of the
access to information that the companies can have. We are relying
on the companies wanting to be interested and wanting to take
it forward and jump on board with an organisation like Envirowise.
As they are set up at the moment they certainly would not be enough.
If you are looking for better dissemination of information then
perhaps you are looking more for regional strengths to try and
give a localised feel of where companies should be going. Collaboration
is certainly the key in something like this. There will be a greater
need for organisations, whether they are Envirowise or whether
they are a new beast formed from the greater need, there will
be the strive for it when we see increases in disposal charges,
when we see the real burden on the companies coming to terms with
their waste disposal. If any different producer responsibility,
legislation, comes in they are not necessarily so keyed in and
so aware of all the legislation out there and it is certainly
something that needs to be addressed. There does need to be more.
Organisations, such as ourselves, are taking this very seriously
in terms of trying to go much further in our membership and looking
at how we can get in and educate and train, particularly the SME
sector.
177. The source of your figures?
(Mr Murphy) I will be able to provide that afterwards.[1]
178. That would be helpful.
(Mr Murphy) As far as the SMEs are concerned, it is
a concern for us because there is evidence that a significant
number of them are unaware of not just impending legislation but
existing legislation. A number of them are unaware of duty of
care legislation which has been in for some time now and if that
is the case then they will be oblivious to the implications of
not just environmental legislation but waste legislation as well.
That is something that we are trying to address through education.
Anything that Envirowise and other national bodies can do to help
to disseminate that information would be valuable.
David Wright
179. How effective do you think small and medium
sized enterprises are in using their commitment to sustainable
waste management in actually talking to their purchasers? Is that
not a key driver, they have got to say to their purchasers "We
are actually credible in this arena and you ought to be buying
product from us because we are progressive in this field?"
How effective do you think they are in doing that?
(Dr Beasley) Probably not very effective so far. I
do not think the whole issue of green purchasing, green purchasing
policies, necessarily has any teeth at all yet. It would be an
area that would incentivise better action within SMEs to try and
improve their own practices so they can demonstrate and stick
their heads up and say "We are the ones you should be dealing
with because we do have good practices". I do not think across
the board there has been very much progress in terms of green
procurement.
(Mr Murphy) We are involved with local Business Link
and commercial groups. It is fair to say that these are driven
by the informed, those who have something to say and those who
have evidence of good practice. They speak at various workshops
and conferences and pass on their information on how easy it is
to get into waste minimisation and green procurement but it is
preaching to the converted in many respects. Those we need to
get to, and it is a huge proportion, are more involved in the
day-to-day practice because they are probably one or two man bands.
1 Please see supplementary memorandum. Back
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