Examination of Witness (Questions 160-179)
1 DECEMBER 2004
MR ELLIOT
MORLEY, MP
Q160 Paddy Tipping: I
want to return to another driver for change and one which we have
had discussions about over a long period of time and that is direct
charging to householders. I know the Government has been looking
at this; what is the current thinking?
Mr Morley: The
current thinking is that we believe in relation to the total range
of measures that we should use in terms of minimising waste and
diversion from landfill, that there is an argument for incentives
and it is something that we would like to see local authorities
introduce, initially on a pilot basis in terms of those local
authorities who would like to participate in such a scheme. There
are some local authorities which have introduced various forms
of incentives themselves in relation to refuse collection. You
can do it on an incentive basis. You could have differential charging
in relation to weight, for example, which is certainly something
which has been discussed and it is certainly something that I
would not rule out for the future. For the moment, however, the
way that we would like to approach it is through incentivising
schemes so those people who minimise waste, separate waste and
recycle get some benefit from that. There are various ways of
doing it and we would like to explore this with local authorities
and to support innovation so that we can look at the various schemes
that are available.
Q161 Paddy Tipping: So
in principle you are in favour?
Mr Morley: Yes.
Q162 Paddy Tipping: You
need to incentivise, maybe by reducing the council tax?
Mr Morley: That
is one way of doing it. There are a number of ways.
Q163 Paddy Tipping: What
is your timetable on this because there has been a lot of discussion
on this for a long time?
Mr Morley: There
has been and we have the Environment and Clean Neighbourhoods
Bill which will be before Parliament this session. It has a range
of measures within it and although we do not need legislation
for incentivising you would need legislation if you wanted to
bring in differential charges, for example. Our priority at the
moment is for an incentive approach and it is possible that we
could talk to local authorities about having some pilot schemes.
Certainly we can discuss it. I do not know whether it would be
too soon for April 2005, it probably would be, so I think more
realistically April 2006.
Q164 Paddy Tipping: Is
the whole of Government sanguine about this? I know the Treasury
in the past have not been entirely comfortable about incentive
charging. Perhaps you would say in your own words where you think
the Treasury is on this?
Mr Morley: I would
not presume to speak for the Treasury. I think that would be a
very dangerous thing to do. I can only speak for myself and for
Defra. I think that there is a very strong argument for a differential
approach in relation to waste charging.
Q165 Paddy Tipping: Can
I just ask you about a plastic bag tax. Again I understand that
you have commissioned officials to look at this. There has been
some work done in the Department. There needs to be a whole environmental
cycle approach to this. Again, what is the timetable on thinking
around, as it is put in the press, a plastic bag tax?
Mr Morley: There
has been a lot of debate about this. It is certainly something
that has caught the public imagination because we get a lot of
letters about it as well. We have been looking at the whole of
life assessment in relation to a plastic bag tax and when you
apply a whole of life assessment there are some complications
with it. The Irish experience, for example, has seen a switch
from plastic to paper bags and there is an issue of weight and
moving around. In relation to fuel use there has been a switch
from using shopping bags to buying black sacks, for example, so
there are some issues that you do need to look at. What it has
done is it has raised public awareness and I think there is value
in that alone. WRAP are promoting a "Bag for Life" with
the big retailers and I think there is some scope, even if we
did not introduce a bag tax, for looking at some voluntary measures
with the retailers in terms of encouraging reusable bags. I understand
that B&Q are introducing reusable baskets and a charge of
five pence for bags. That is a voluntary measure. I think that
is worth exploring with other retailers in relation to what measures
we could take there. I would not rule out a plastic bag tax but
it may be that we can get very similar results with a voluntary
agreement with the retailers.
Q166 Paddy Tipping: The
real advantage is just raising the public profile of the issue?
Mr Morley: In terms
of a whole of life assessment it does appear that the main advantage
is raising awareness.
Q167 Chairman: What are
you doing to promote the use of real nappies? As I understand
it, the only nappies that are included in new mothers' Bounty
bags when they have their babies are disposable nappies and I
would like to know what the Government is doing to make certain
that at least there is an equality of opportunity for choice for
new mothers in terms of nappies.
Mr Morley: I quite
agree that it is important that new mothers are given the opportunity
for choice in relation to nappies. The Bounty bag, as you will
be aware, is a commercial operation so therefore what is in it
is what various producers pay to go in it because it is a commercial
venture, however we have talked to the Department of Health on
this issue. The Department of Health do produce leaflets for new
mothers which also within the leaflet give equal treatment to
reusable nappies as well as disposable nappies. It is also the
case in some hospitals and some maternity units, although not
all, that reusable nappies are used within the maternity wing
and of course it is an opportunity for new mothers to see how
reusable nappies have moved on from the old terries. I have seen
a range of these new nappies myself. They are much more convenient,
they are better designed, they also have removable liners as well
which make things a lot more convenient, too. In various parts
of the country there is a complete laundry service which includes
the collection and delivery of the nappies which are collected
and brought back laundered, which is convenient in relation to
what people want. So there are range of options and we think it
is very important that people do have the choice on those options.
Chairman: Nobody can say
this Committee does not get down to the bare basics but, Mr Lepper,
you wanted to make a point?
Q168 Mr Lepper: Just an
observation on that, Chairman, if I may. My own local hospital,
the Royal Sussex County Hospital in Brighton, promotes the
use of real nappies within the hospital but then, as the Chairman
has already indicated, what often happens when the new mum is
leaving with baby is they get the Bounty pack with the disposable
nappies in it, undermining to some extent some of the good work
that has been done in the hospital itself. I gather that the little
rake-off that they get from these Bounty packs does not raise
very much for hospital trusts. Could I commend to you a publication
aptly called Time for a Change produced by the Brighton
and Hove and East Sussex Real Nappy Network, recently published
partly thanks to assistance from your Department which helped
to fund a project officer who is doing a lot of good work in the
Brighton and East Sussex area. Just an observation.
Mr Morley: I am
very pleased to hear that, Chairman.
Q169 Chairman: Let us
move to the end product then—well, not quite—to the
Landfill Tax. Minister, the level is going to rise in due course
to £35 a tonne. Why was £35 chosen as the right number?
Mr Morley: I think
that there is a consensus amongst groups I have spoken to, whether
they are environmental groups or industry groups, that £35
is about the right level. That really begins to impact on people
and both provides an incentive to divert waste away from landfill
and also is at a level that gives those industries which are
providing alternative services and alternative routes some economic
viability. So I think that the actual level of £35 is pitched
about right.
Q170 Chairman: What is
the current take from the Landfill Tax and how is it split between
public and private?
Mr Morley: I can
give you those figures in relation to the current take on that.
I think it is £284 million, although that is what we are
expecting in the 2004 Spending Review over three years from Landfill
Tax.[6]
Q171 Chairman: And how
is that split between public and private?
Mr Morley: The
BREW programme for 2005-06 will deliver round about £43 million
in the year 2005-06 and that will be split between Envirowise
to do minimisation work and WRAP to help small businesses deal
with waste.
Q172 Chairman: I was interested
in the income stream, in other words where was the money coming
from?
Mr Morley: From
which sectors?
Q173 Chairman: Yes.
Mr Morley: I would
have to write to you with that, Chairman, with the actual breakdown.
Q174 Chairman: Right.
The reason I am asking the question is, first of all, why the
resistance moving to £35 now, why the transition period?
Mr Morley: Like
all things, there is a debate in relation to the benefits of the
level of the tax, the £35, and the impact that that would
have on industry and the industry sectors who rely on landfill.
It was felt that going straight to £35 per tonne would be
such a huge impact that it would be very damaging in relation
to industry competitiveness, so therefore it is being phased in
at a rate of £3 a year from the original level. There is
always going to be an argument about whether that level is too
high or too low. I think there is a very good argument for getting
to that £35 as quickly as possible. Nevertheless, you have
got to take into account the impact on industry and I think that
is the balance that has been struck.
Q175 Chairman: Are you
happy with the way in which the money is being used in terms of
the diversionary projects? Are you seeing good results from that
expenditure?
Mr Morley: Yes,
I think we are seeing good results. I think that WRAP have used
the money very well. It has been very helpful in relation to the
way that they have put money into developing markets, for example
for recyclers, because separating waste and recycling is one thing
and recycling but finding new markets is a crucial part of that
because you need the markets to give the value. That is also an
incentive to the minimisation, the reuse and the diversion. The
funding has gone into other areas as well. I was mentioning Envirowise
in relation to minimisation and there are also things like the
DTI Technology Fund and the Market Transformation Programme, for
example, which Defra has.
Q176 Chairman: When could
we expect to see a report which would analyse the value for money
that has been achieved, or the outputs that have been achieved,
for the expenditure of the Landfill Tax to assess the different
levels and whether in fact the diversionary and other educative
programmes to reduce waste have actually been effective.
Mr Morley: WRAP,
who are one of the major recipients, produce an annual report
and that does outline the various expenditures, where the programmes
have gone, and how that has been applied. There is also the BREW
Programme which starts next year in April 2005 and that will also
have an annual report in relation to the money that goes particularly
into the business side, so in terms of all the expenditures there
will be an annual report which will outline where the money has
gone, what projects have been supported and what they have achieved.
Q177 Chairman: What I
would be interested to know when you write to us with your
further contributions—for example, I understand that last
week you allocated a further £43 million—is whether
that is fully funded by the private payers of the Landfill Tax
or whether in fact there is a public contribution to that? It
would be useful to know what the split of public and private is.
Mr Morley: That
£43 million is from landfill.
Q178 Chairman: So that
all comes from private users?
Mr Morley: There
would be the local authorities of course that would pay towards
that as well.
Q179 Chairman: That is
why I was asking the question because effectively you are recycling
public money, are you not?
Mr Morley: It is
private and public money.
6 The figure of £284 million refers to the increase
in Landfill Tax paid by business [Note by witness]. Back
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