Memorandum submitted by the Chartered
Institution of Wastes Management
1. The Chartered Institution of Wastes Management
(CIWM) is the leading professional body for the waste management
sector representing nearly 7,000 individuals in the UK and overseas.
The Institution seeks to:
— advance knowledge and best practice
in waste management in order to protect the environment;
— achieve high standards of competence
and conduct amongst its members; and
— raise awareness, understanding and
standards amongst all those working in and with the waste sector.
2. CIWM is contributing to this inquiry
because it believes that financial measures play an important
role in modifying behaviour and in encouraging the take-up of
new waste and resources management approaches that can bring real
benefits for the environment.
3. The Institution has contributed to Defra's
development work for the revision of Waste Strategy 2000 through
the preparation of a "Lessons Learned" report. This
identifies strengths and weaknesses in the waste strategies of
Scotland, Wales and Northern Ireland together with recommendations
which the Institution would like to see developed in the new strategy
for England. This is complemented by a second report looking at
best practice across the EU, which looks for common conditions
prevailing in states whose waste management performance is better
than in the UK. Both identify important financial issues which
would support more sustainable waste and resources management
in the UK. Copies of the reports have been attached to this evidence
as Appendices 1 and 2 for the information of the Committee secretariat
[not printed].
TAXATION
Principles of environmental policy making
4. CIWM agrees strongly with the assertion
that, where tax is used, it should aim to shift the burden of
tax from "goods" to "bads" and that the polluter
must pay.
Landfill tax
5. CIWM is pleased that the annual incremental
increase in landfill tax per tonne is to continue. However, the
Institution believes that the tax as it currently stands cannot
achieve its full potential as a catalyst for changes in waste
management practices and the way the market operates, because
the tax is too low and the process too gradual.
6. CIWM believes that the proposed ceiling
of £35 a tonne is acceptable but that this point should be
reached more quickly.
7. The Institution would like to see an
immediate rise in the landfill tax escalator from £3 per
tonne to a least £5 per tonne per year and believes that
the impact of a higher rate of increase should be modelled for
possible future imposition.
8. Balanced against the need for a higher
rate of taxation, the tax increase should be predictable (planned
and announced on at least a three year rolling basis) thereby
allowing time for waste producing businesses to change their practices.
The landfill tax ceiling should also be kept under review as part
of the rolling three year plan.
9. Local authorities have to meet tough
challenges in terms of the requirement to divert biodegradable
municipal waste from landfill under the Landfill Directive—by
2010 it must be 75% of that produced in 1995; by 2013 it must
be 50% of the 1995 figure; and by 2020, it must be 35% of that
produced in 1995. However, CIWM believes that there should be
an evaluation of the costs and benefits of requiring local authorities
to pay the landfill tax in addition to having to comply with LATS
targets and associated potential penalties.
Incentives for new technologies/facilities
10. CIWM supports the proposal of an enhanced
capital allowance scheme to facilitate innovative waste management
options and new waste technologies.
11. However, CIWM also believes there is
a worrying lack of waste facilities across the board that is hindering
the UK's ability to achieve sustainable waste management—this
is as true of existing technologies as it is of so-called "new"
technologies.
12. As a top priority, The Institution would
certainly like to see enhanced capital allowances applied to the
establishment of energy from waste facilities, as the potential
role of such facilities in helping the UK meet its renewable energy
needs, as well as achieving effective sustainable waste management,
is very significant.
13. CIWM also believes that enhanced capital
allowances could be used more generally for approved technologies
or site-specific proposals in order to encourage private sector
funding and to speed up the development of much needed waste recycling
and recovery infrastructure.
Green procurement
14. The Government should stimulate "green
procurement" by businesses and demand for recycled and recovered
materials through tax incentives for high recycled content products
(subject to meeting minimum product quality standards).
Taxes should also be introduced for the purchase of priority virgin
raw materials taxes (as opposed to the recycled equivalent.)
Differential and variable rate charging for householders
15. CIWM would like to see the Government
encourage the development of differential and variable charging,
or other incentives, to encourage householders to minimise residual
waste for disposal. In particular, Government should allow a variety
of pilot schemes to be tested by local authorities across England.
16. It is clear that consumer education
only works up to a point and that an extra element of incentive
is needed to take behaviour on to the next level. While the current
cost of waste collection per household per annum is relatively
low, this is set to rise as the overall costs of waste disposal
increase. This will make incentive schemes more effective.
17. A high proportion of EU countries, and
part of the United States, are currently applying the polluter
pays principle at householder level. The UK appears to be unique
in the EU in the way that it requires local authorities to finance
waste management services through general municipal taxes and
actively prohibits them from levying waste management fees directly.
18. This process would also be useful in
making householders aware of the usually low costs involved in
waste collection and management (£50-£60 a household
per annum) and what could be achieved if charges were even modestly
higher.
19. A common practice in other European
countries is to apply ring-fenced direct charging and to use this
to improve services and establish new facilities.
FUNDING
BREW Programme
20. The BREW Programme has done valuable
work in helping organisations to improve resource efficiency,
for example through a variety of information, advisory and consultancy
services. However, there is a need to raise general awareness
and skills levels in relation to waste management issues amongst
producers across the board. CIWM believes that consideration should
be given to directing more of the funding towards major education,
training and communications initiatives aimed at this group.
Defra funding for local authorities
21. CIWM welcomes the allocation of additional
Defra funding to help local authorities in England to improve
their waste services through the Waste Performance and Efficiency
Grant (latest allocations announced 23 December 2005). However,
the Institution believes that, if local authorities are to plan
effectively for the future, providing sustained funding for waste
rather than funds that local authorities have to "bid"
for would be more beneficial.
22. CIWM is also disappointed that this
additional funding is not ring-fenced, meaning that there is no
certainty that the money will go to improved waste and resource
management.
23. The Institution would also like to highlight
the fact that this funding only supports municipal waste, which
still represents no more than 8% of the total in England. This
reflects the generally disproportionate focus on municipal versus
industrial/commercial waste in UK Waste Strategies and policy.
CIWM would not like to see less support for local authorities,
but feels that there needs to be a stronger focus on infrastructure
and planning for all wastes and looks forward to the new National
Waste Strategy for England as an opportunity to redress this imbalance.
24. An important, specific example is the
need to encourage co-management of municipal, industrial and commercial
waste for reasons of economies of scale, reduced environmental
impact of transportation and generally greater efficiency and
effectiveness. Co-management of wastes appears to be an important
factor in successful diversion from landfill in other European
countries. The UK is currently lagging well behind in terms of
exploring and introducing this type of approach which would involve
much closer working between local authorities and private companies.
CIWM is therefore disappointed not to see some encouragement towards
co-management of wastes in this additional funding allocation.
BORROWING AND
INVESTMENT
25. Enhanced capital allowances can help
to encourage investment in new waste and resource management facilities
and technologies.
26. However, these cannot completely resolve
a fundamental issue affecting borrowing for waste management facilities
which does not feature in the Pre-Budget Report. The emphasis
on PFI in the UK places all risk on the private sector, reducing
the attractiveness of particular schemes for contractors and investors.
This reluctance is impacting on the amount, cost and distribution
of waste facilities in the UK.
27. EU Member States which have better developed
infrastructure are characterised by a variety of financial approaches,
such as prudential-style borrowing (underwritten by direct local
taxation) which broaden the share of risk across the public and
private sector.
28. The Government should seek to facilitate
such alternative types of borrowing in order to make projects
more attractive to contractors and investors.
January 2006
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