Examination of Witnesses (Questions 360-379)
WEDNESDAY 2 APRIL 2003
RT HON
MICHAEL MEACHER
MP AND MS
SUE ELLIS
David Taylor
360. You seemed to say, earlier on, that the
three key elements were targets, resources and markets, and then
you went on to talk about resources, then you went on to talk
approvingly of PFI schemes being at the present level of £220
million, going up to about £350 million. Earlier evidence
that we have had from local authorities suggests that they do
not necessarily see that in the same positive light, because PFI
schemes do not allow them perhaps the level of detailed control,
in terms of setting priorities, and the PFI companies themselves
are likely to pursue, what shall we say, profitable activities
at the expense of political priorities. Do you recognise that
as a problem?
(Mr Meacher) I do recognise the general problems over
PFI, this is a very, very sensitive issue, which goes far wider
than what we are talking about today. But a PFI system is a long-term,
fixed-price contract, agreed by a private contractor, in order
to deliver standards specified by the local authority, and it
is for the local authority to determine those standards that they
believe are necessary. I think, without being overprescriptive,
they should certainly be very clear and detailed and thorough,
and it is their responsibility for that to happen.
361. I am sorry to interrupt you. If during
the contract period there are changes in available methods, material
mix, and so on, does not the local authority find itself backed
over a barrel into trying to change to reflect the circumstances
six or ten years into the contract?
(Mr Meacher) I understand that is a possibility, but,
again, if they were well advised, certainly they would have clauses
in the contract which would allow them, where there is a change
in technology, much improved equipment or plant becomes available,
that there should be a renegotiation of those parts of the contract.
I agree, that may not happen, and these problems can occur, particularly
if one has a 25-year period of life for a PFI, as opposed to,
say, 15 years. They are also very large block contracts, up to
£25 million, so, of course, it does mean that you have a
relatively small number of large contracts, rather than being
spread evenly across the country. But I do recognise those problems.
They are designed to produce greater efficiency in the delivery
of agreed standards and objectives, but they do need very, very
careful writing and very thorough examination; we are trying to
provide guidelines to avoid some of the kinds of problems that
you have mentioned.
David Taylor: And PFI companies salivate when
that word "renegotiate" pops its head round the door,
do they not? Sorry about that.
Mr Drew
362. To move on to the issue of incineration,
which probably will not surprise you, having talked about this
locally, in Stroud, we went to Denmark, and obviously Denmark
is the height of incineration, in terms of their strategy, now
they are adamant that incineration has never crowded out recycling,
reuse, and so on. But there is a notion, and this has been put
to us on more than one occasion, that if we do not get waste reduction
locked into place soon enough the only option you end up with
is incineration, and certainly there are players out there, you
are aware, Michael, basically who want us to fall on our face,
because they will come in with the instant solution, notwithstanding
all the planning problems of getting incinerators put in place.
But that is an inherent risk, is it not, that is why, if we do
not get reduction in place sooner rather than later, we do narrow
our options; would you share that worry?
(Mr Meacher) Certainly, I am extremely keen that we
should put in place effective mechanisms that do reduce the creation
of waste. If we are really going to deal with this, the current
rate of growth of waste arisings is about 3, 4% a year, which
is faster than economic growth, in the recent year or two almost
twice the rate, and that is very serious, very serious indeed.
If really we are going to achieve control of this problem we need
to decouple economic growth from waste arisings, so that in a
year in which you get 2 or 3% growth you get, say, -1% waste arisings,
compared with the previous year. Now we are an awfully long way
away from that, but that is, I would say, a milestone before really
we begin to get control of this problem. So I do not take the
view that, well, reduction would be very desirable and if we do
not get it we are going to have a lot of incineration, I am determined
that we do get reduction, and if need be begin to think about
more mechanisms to ensure that that happens. One way of doing
that, of course, is through the landfill tax escalator, which
the Chancellor said will be, it is an extra £3 in 2005/06
and at least £3 per year up to £35, and, as I say, we
are trying physically to reduce the amount going to landfill.
The Budget 2000, the Chancellor said that the Government is considering
an economic instrument in respect of incineration. We are determined
to ensure that incineration pays the environmental and social
costs and that those should be internalised. Also, of course,
we want to minimise waste, as I have said, and move waste up the
waste hierarchy, and incineration does not do that. Certainly,
we want to avoid incineration becoming the next-cheapest option
after landfill. So we are very conscious of the problem. In addition,
I did publish guidelines, in September 2000, which said that approval
would be given only for incineration which did not crowd out recycling
or pre-empt future possibilities of recycling, so that one does
not build a large incinerator which is going to gather waste from
a large area around, in defiance of the proximity principle. So
I am not saying there will not be any increase in incineration.
As you rightly say, Denmark, which is often considered much greener
than us, has a far higher level of incineration than we have,
but that certainly is something that I believe is not necessary,
not desirable, and probably will not happen. My last point is
that, in addition, of course, to mass-burn incineration, there
are the new technologies coming in, gasification, pyrolysis, anaerobic
digestion, which I think are quite promising, quite different,
it is sort of cooking it in the absence of oxygen, as I understand.
363. Could I pick up just the one point, because,
obviously, what we did learn by going to Denmark was that they
refer to carrot and whip, which I think we call carrot and stick,
and they were very clear that there must be not just a landfill
tax but, at a lower level, an incineration tax, so they have used
economic instruments to help move up the waste hierarchy. And
I am interested; we cannot keep having this debate on economic
instruments, either we are going to introduce an incineration
charge of some description or we are not, because people are making
their plans at this moment and they want some clarification?
(Mr Meacher) I agree, and that is why the Government
has commissioned a report on the environmental and health costs
of all forms of waste management and disposal; that is in place
now, it will produce a report, and in the light of that we will
make a decision on whether or not to proceed, as the Chancellor
hinted last year.
Mr Wiggin
364. The Minister touched on the waste hierarchy
in his opening comments. There are concerns from people like the
Renew Trust that the current focus on recycling means that reusing
gets pushed to one side; what is your view on that?
(Mr Meacher) It is certainly not intended to be, and
if a product can be reused, in my view, that is better than recycling,
which is a more involved and expensive process. The number of
times though that a product actually can be reused and, as it
were, renewed, used again as new, must be relatively small; but
certainly there is no intention to squeeze out renew at all. Recycling
is not the holy grail, it is part of the way of handling products
that cannot be reused or recovered.
365. The holy grail really is the whole sort
of pyramid of the hierarchy; so why did you miss the chance to
include that in the Waste and Emissions Trading Standards Bill,
why could you not have enshrined it in legislation?
(Mr Meacher) Why did I not enshrine what, in that
Bill?
366. The hierarchy, and actually start to give
it a bit of legislative power?
(Mr Meacher) Because the purpose of the Waste and
Emissions Trading Bill is to secure a limitation on the amount
of municipal biodegradable waste going to landfill, that is its
purpose; it is not about establishing the waste hierarchy, that
was already set out very clearly in the Government's Waste Strategy
in 2000. This was a particular part of that general landscape,
and we need legislative cover, a legislative base, in order to
do this, in order to say that "You sent 100 tonnes to your
landfill last year; next year it's going to be only 95, and the
year after that 90." So it is specifically for that purpose.
It is not designed to go over the entire range of the Waste Strategy,
because we think that is already understood, clearly publicised,
and other mechanisms, which do have legislative cover, are already
in place; this was just a gap which was being filled.
Mr Lepper
367. Michael, one of the things that we found
out on our visit to Denmark, to which David Drew has already referred,
was the difference in the Danish system in the way they deal with
packaging recycling targets. In this country, as I understand
it, everything is weight-based, and the Danes, I think, take a
different view, they look at the environmental impact of different
forms of packaging. Now Waste Watch, when they gave evidence to
us, said they felt that one of the results of our approach to
packaging recycling targets was that it had led to an increase
in plastic packaging, coupled with an unwillingness on the part
of local authorities to recycle plastic packaging. Now have the
Danes got it right; should we be looking at what they are doing?
(Mr Meacher) Certainly we should be looking at what
the Danes are doing, because I have always regarded Denmark as
a country well worth looking at; they are not always right, as
I say, things go wrong in waste management, even in Denmark, but
of course we should look at it. Clearly, there is a lot of dissatisfaction
about packaging in this country, I get more letters, no doubt
from some of your constituents, which you send on to me, saying
how the Government is doing nothing about packaging and it is
all increasing. I suspect what triggers that is what happens in
the supermarkets and at supermarket checkouts, when you have already
got a product which is double-wrapped and then they give you a
plastic bag, and sometimes a plastic bag to go into another plastic
bag, and people think that it is far too much. I do say that people
ought to refuse it, which I do, when I go through the check-out.
But what they do not understand, and what I try to convey in the
replies is that the recycling of packaging waste is already on
a substantial scale. We had a 50% target last year; for reasons
to do with one of the compliance regimes, we just failed that
and we achieved 48. But within the period 2006-08 we shall be
agreeing, in Brussels, for an increase in those targets up to
60-65%, so within a period of three, four years, we shall be required
to reprocess, recycle, two-thirds of all packaging; now I think
this is not widely understood. What has happened in this country
is that the measures already in place have led to repackaging,
because what happens is, if you get a large package, a large plastic
or cardboard package, people consume most of it, but a significant
amount is left in the package, and often it is thrown away, it
is wasted. So the idea is—and there may be a little commercial
purpose in this as well, of course—to package it more closely
to what is likely to be consumed, so that there is no waste of
the contents, which is a good thing. So the bottles and the cardboard
packages, and sometimes the plastic wrappings, are often smaller,
the thickness of the bottles is often thinner. Now I have been
taking a great interest in having "return and deposit"
schemes reintroduced into this country, and one of the problems
I have encountered is, "Ah, well, your policies have reduced
the size of the bottles," or the thickness of the bottles.
Now if you have "return and deposit" systems they will
have to be cleaned out, scrubbed out with caustic soda, and the
thickness of the glass is not sufficient to withstand this; so
you have got a problem that it is contrary to your existing policy.
So these are the sorts of problems that arise. I have said to
the Advisory Committee on Packaging, whom I am meeting very shortly,
that I am dissatisfied with the amount of packaging waste. It
is done, as you say, on a tonnage basis, they do have to pay for
that, if it is reprocessed they have to pay for the reprocessing
of it, and the greater the weight, the more the tonnage, the more
they have to pay; so they have got an incentive to reduce, and,
to some extent, I think, they have, but it has not satisfied the
public and it does not satisfy me.
368. But you talk still in terms of overall
tonnage. Should we be looking at the environmental impact of different
kinds of packaging; that was the basis of my earlier question?
(Mr Meacher) Right; you mean, a shift to plastics.
That is, I agree, a real problem, because plastic, of course,
is the most difficult substance to recycle, because it is quite
bulky and it is not easily squashed, so it takes up a lot of space,
and the recycling rate is 12, 15%, something of that order, and
certainly we need to increase that sharply. What I did not say
is that not only are the overall packaging targets being increased
quite sharply, from 50 to around 65%, in the next few years, but
there are material-specific recycling targets, which for paper
and glass are very high, and are going to be even higher, but
for plastics, for the first time, it is going to require a significant
increase in plastics recycling. And that will be a requirement
on companies who use plastic, and indeed they may have to come
into the household waste stream in order to recover, to retrieve,
the plastic, in order to meet their recycling targets. So I think
we are beginning to deal with this, but, I agree, not sufficiently
to satisfy the general public.
Mr Jack
369. One thing that bothers me slightly in all
of this is that the people, certainly at the domestic level, it
is all of us, who are producing waste, all of these targets are
sort of really irrelevant, in the sense that there is no bill
attached in the United Kingdom to producing any waste. There is
lots of good and worthy effort, and people are terribly enthusiastic
about sorting things out and doing their bit, but you made the
point that you would like to see better strategies for waste minimisation,
and it strikes me that people do respond to economic signals quite
well, that they adjust their lifestyle. Why have you shied away
from this route?
(Mr Meacher) We have not shied away. It is one of
the recommendations of the Strategy Unit report, which did recommend
that there should be pilots for local authorities who wanted to
introduce what is sometimes called "variable charging".
It is not the case, of course, that there is no tax on people
with regard to dealing with the waste that they create, there
is, it is part of the council tax; the problem is that very, very
few people realise that, and, of course, it is flat rate. If you
live in the same local authority and you produce very little waste,
you make no gain, compared with another family, next door, who
create an awful lot of waste. And there is, of course, an argument
for creating an economic signal, and I do understand the logic
of that suggestion, but it is part of the Strategy Unit report,
and I am afraid you are going to have to wait a little while longer
to see our response.
370. So you are keeping this air of mystery.
Let me tempt you just a little bit down this street. In preparing
for your response, actually have you done any economic modelling
to work out the possible effects of some different charging mechanisms,
and, if so, which mechanisms have you evaluated?
(Mr Meacher) It is a very good try. We have not, but
the Strategy Unit team did look at action on this in other countries,
and I think there were 17 countries, if I remember, who do this
at the present time, and, of course, they looked at what those
mechanisms were and how successful they were thought to be. There
is no question that it can be done, there is no question about
that.
371. Did any of the results which the Strategy
Unit did put into the public domain impress you?
(Mr Meacher) We have taken firm note of them.
372. You have taken firm note of them; well,
let me come back and ask the question again. Is Defra doing any
independent work to evaluate these different charging mechanisms?
(Mr Meacher) No.
373. So you are doing it yourself?
(Mr Meacher) No. We have the report, there have been
discussions on this and other outstanding items; the Government
now has an agreed position and that will be published very shortly.
Mr Mitchell
374. Your answer to my somewhat jaundiced question
initially was that we fix more targets, and there is now a prime
ministerial strategy. It is not jaundiced to say that this Government
has got targets running out of its ears, it would be nice to fix
a target for no more targets; on everything there is a prime ministerial
strategy, we have got one even on fishing now. Surely this is
not enough; let us talk just a bit more about targets, because,
"Waste not, want not" suggests more targets for local
authorities. There is a waste minimisation, or recycling, target,
a higher national recycling target of 45%, I think you said 25%,
they want 45% by 2015. Do you think statutory waste targets, this
is not just airy-fairy targets, statutory targets, would be effective
for local authorities?
(Mr Meacher) I do think that, and that is exactly
what we have set. The targets are not aspirational, they are statutory
performance standards, which under the BVPI (Best Value Performance
Indicator) system local authorities are required to adhere to;
so they are statutory targets. Now you say "You've got targets
galore," I am not going to comment about the wide range of
them, but I do know that in waste management it is absolutely
essential that there are targets to guide resources and effort
in local authorities. We started off in 1997 where there were
a handful of local authorities whose recycling rate was 1%. Let
me put up my hand and say I think Oldham was 3 or 4%, it is very
low; there are other local authorities who are at 25, 30%, possibly
somewhere even above that. So there is a huge range. Now how do
you drag up, apart from this block of, say, I do not know, 15%
who really have done extremely well, the remaining 85%, the second
half of that in particular, who have really never given any particular
attention to this at all. I think the only way to do it is to
set a target and a timescale and expect them, and intend them,
to meet it; that is what we have done. I do not regard this as
targets coming out of our ears, I regard this as the minimum statutory
pressure necessary to get a change on the ground.
375. Statutory pressures, but will they face
penalties or fines if they do not achieve the targets?
(Mr Meacher) That is a very good question.
376. Unlike the other three?
(Mr Meacher) I will give it a good answer, like the
other three. What I am proposing is, first of all, to identify
those who are failing. I wrote to 142 local authorities last August,
saying "The latest evidence we have from you, in your annual
returns to this Department on recycling, does not suggest that
you are in line to meet your targets in 2003-04 this is the information
we have, if it is incorrect please tell us, and obviously we will
take note of that and revise our opinion." As a result of
that, we have excluded 20 or 30 from the danger list, if you like.
I have now written to the remainder, 100 plus, saying that "In
the light of the information you have given, I am still not satisfied;
and have you drawn up a plan to bring you back on track, do you
need assistance from either the private sector or from WRAP, or
from possibly local authorities around you who have a better performance?
We are expecting you to do this. I would like to have your response
within a short time;" date given. That is the point we have
reached. I will follow that up in the light of what was said,
by demanding that. I do have an action plan which indicates how
they are going to get back on track. In the last analysis, if
all else fails, we can remove, of course, although I do not want
to do this, the waste management function from a local authority
and give it to someone else, whether that is a private company
or a consortium of local authorities who could do the job better.
But, of course, the local authority will still pay whatever it
costs, so it is not as though this is an unwelcome function which
conveniently can be removed from them, they have a responsibility
and I am determined that they meet it. And the key point is, I
repeat again, and many other Members have said it today, that
there has to be pressure put on local authorities to get them
to reduce the amount of waste that is being created. In parts
of my own constituency, I have seen completely unacceptable levels
of waste creation, which not only are littering the landscape
but which, in nearly all cases, will end up in landfill, and that
is not acceptable.
377. Do those penalties include fines, financial
ones?
(Mr Meacher) They could do.
378. You will not say definitely?
(Mr Meacher) I am not proposing that, because, of
course, the local authority will then turn round and say "By
fining us, you've made it more difficult for us to achieve our
objective," and there is some force in that argument, so
it is not the best way to proceed.
379. Also, of course, they might turn round
and say "Why should we be fined for failing to achieve your
targets, when national recycling targets have not been achieved
either?"?
(Mr Meacher) I am not quite sure what you mean by
that. The national recycling target for this current financial
year, which has just started, is, nationally, across the country,
17%, but, of course, those who started very low cannot be expected
to get 17; they have got to do a little better.
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