Examination of Witnesses (Question Numbers
180-194)
MR DIRK
HAZELL, MR
RICHARD SKEHENS
AND MS
GILL WEEKS
12 NOVEMBER 2008
Q180 Paddy Tipping: Explain that
to me a bit more, on an existing site, a shorter route to make
changes.
Mr Skehens: Well, under the permitted
development rights, the owner/occupier of the land has the ability
to make changes. I hope I am not teaching you to suck eggs here,
but there are certain criteria by which you can make simple changes
to your operations which will enhance the operations, speed them
up, will give better measurement, for instance, by putting weighbridges
in and such like. Without permitted development rights, you have
to make a planning application each time you want to make this
change, so it could be the parking of vehicles or it could be
that the weighbridge is a very good example, and we all know that
the planning system, by its very nature, is quite slow and laborious,
but it also gives people an opportunity, so they may not object
in principle to a weighbridge being moved, but they may object
in principle to the waste site being there, so it just opens a
can of worms. By allowing permitted development rights, and bear
in mind that these are usually for pretty minor issues, it could
actually make the industry more efficient. The third recommendation
we would make follows the Environment Agency's evidence on dual-tracking,
ie, the simultaneous processing of applications for planning and
permits. Unlike other industrial processes, however, which do
not have to have a planning permission before they can get a permit,
waste facilities have to have a planning permission before they
can get a permit, so I think, in practice, a lot of the companies
already try and twin-track the PPC permit and planning application,
but it would make life easier if this hurdle of having to have
the planning permission was not there because the permit sometimes
guides the planning permission, so the chicken and egg situation
would be reversed. The other element on applications is that we
feel that the deadlines for responses should be enforced by the
local authorities because a lot of applications are delayed quite
dramatically by statutory bodies not actually bothering to respond
or literally waiting til the last day and then asking a whole
series of questions, and that, once again, delays the process.
If they knew that the deadlines were going to be met, I think
they would respond in a far more positive manner. Our fourth recommendation
is that PPS10 should be better reflected in the waste development
plans and, in the absence of waste plans, perhaps PPS10 should
prevail.
Q181 Paddy Tipping: Can you just
explain that a bit more to us?
Mr Skehens: Well, PPS10 was introduced
in July 2005 and it sets out the national policies for the planning
of waste. It is a very, very good document which most people,
I think, accept and try and work to. Some local authorities, however,
because they are still struggling with their waste development
plans, have rather put it on the back burner, and what we are
suggesting is that, while the waste plans are not in place or
the local plans are not in place, perhaps greater emphasis should
be placed on PPS10 in the interim because at least it will help
the process to move forward. I think our final recommendation
is on the proposed national policy statements. I think the Bill
before Parliament at the moment concentrates very much on large-scale
facilities and we would like to see that particular element of
it widened because an awful lot of waste facilities, although
absolutely vital to the local and regional infrastructure, will
not come anywhere near the scale of these large facilities, and
it would make life an awful lot easier if the Planning Bill were
actually to pick that up and say, for small facilities, that it
is very important as well and it might help to fast-track some
of these applications through.
Mr Hazell: And it is a very important
part of our evidence and, if it would be helpful to the Committee
for us to reproduce Richard's remarks and supplement them, we
are more than happy to give you some supplementary evidence, if
that is helpful.
Q182 Paddy Tipping: David Drew was
asking about PFIs. Here we do a lot of PFIs and I guess you do
as well, Richard.
Mr Skehens: We try and avoid them.
Paddy Tipping: They seem incredibly long-winded
and difficult. Are they the best way of funding new infrastructure?
Q183 Mr Drew: I just want to come
in on the back of that because this is highly pertinent to me
because today Gloucestershire has just received its announcement
of a £92 million PFI credits deal with Defra, and I am just
intrigued because the County Council is now saying, "Well,
the market will decide on the appropriate forms of waste disposal",
and I would just welcome the industry's view on: is this the best
way to actually do this? It appears that they are waiting for
you to decide and you have got to make it work for the money,
which may or may not be a good thing.
Mr Hazell: As an industry, and
there are nuances between the different operators, but, as an
industry, there is no ideological commitment to PFI. What we want
is something that is going to provide the money and is going to
provide long-term certainty for the operation of capital equipment,
so the PFI is a means of giving a local authority up to half the
money they need for capital expenditure. It is true that the guidance
that comes from central government on PFI has recently improved,
but it does tend to be quite inflexibly interpreted by local authorities.
It is also the case for our sector, and the CBI more generally
is looking at the application of this across the whole economy,
but, in our sector, the implementation of the European Union requirement
for competitive dialogue has raised bid costs and it is very expensive
to bid for contracts. At the absolutely final stage, for the winner
it is now a bit quicker, but the industry's total bid costs for
any possible auction are much higher than they were and that is
not great news in terms of competition. It is also the case, in
the context of the sorts of contracts you get in this sector,
that PFI is really more designed for buildings and the bulk of
the added value and a lot of the contracts our sector provides
are really on the service that is provided from those buildings.
So we do not have this great ideological adoration of PFI as a
sector, it is just the means to the end that happens to be available.
Q184 Mr Drew: So, without putting
words in your mouth, because I think it is actually quite important
because I think this is something that is really at the back of
a bigger debate, to what extent does PFI then actually create,
if you like, a hard technology solution because you have got money
upfront and somebody has to build something for that money rather
than what might be something which evolves over a period of time,
which may, in the long run, be beneficial, but, as yet, is perhaps
a little bit more vague because of the way in which the waste
industry is itself evolving?
Mr Hazell: Well, let us answer
your question in a very direct way, taking what, I think, is behind
it, that this country could do with a lot more energy from waste
facilities than it has currently got, and PFI is not a bad vehicle
for energy from waste facilities. Again, it is for Treasury ministers
to say what they think, but PFI has now lost a lot of its attraction
to governments over the last 15 to 20 years anyway. We will work
with the tools we are given and the key driver for our sector
is regulation, but we also need some money, and, as long as we
get both of them, we will deliver the services you require.
Q185 David Taylor: I am surprised
by that last answer, I have to say, because PFI would seem to
be expanding rather than retrenching. PFI could be prohibitive
in cost, flawed in concept and intolerable in content for the
people that have to operate it, and I will take your silence as
assent! In the submission that you made, paragraphs 7 and 8, I
just want to have a brief look at that, you observe that the UK
generates less energy from waste than other EU nations, and I
wonder, when you refer to economic or other incentives to get
those levels up, what sort of tools you had in mind and what would
be the scale of cost perhaps?
Mr Skehens: We have looked at
this to see whether we can sort of perhaps benefit the increase
in the Efw plants. Enhanced capital allowances would obviously
help and the provision of ROCs for conventional energy from waste
would help. Probably one of the key drivers is still the landfill
tax because, if the landfill tax continues to go up and there
is some certainty past 2010, which we have already mentioned,
that will also help drive technology.
Q186 David Taylor: What capital allowances
do you get, on average? Is it 40% in the first year and 25% thereafter?
Mr Skehens: Is it not 25, 25 and
25? That is for the plant, although the building obviously is
written off over a much longer time.
Q187 David Taylor: Do you think that
that mix of measures would be sufficient to drive it up?
Mr Skehens: Yes, it would help,
it would definitely help.
Q188 David Taylor: Is there not some
evidence that the Government, through covert means of PFI credits
and others, are trying to get incineration, which is what it was
once called in its controversial clothes and which has now morphed
into energy from waste, is it not trying to get incineration as
being the option, the only show in town, if you like, to local
authorities who then have to wish incineration schemes on communities
like Bardon in north-west Leicestershire where it is a very controversial
issue at the moment?
Mr Skehens: Yes, I know Bardon.
It is a controversial issue wherever you put them because I think
the general public have an aversion to energy from waste or incineration,
as you called it. There is a slight difference because, with pure
incineration, that was devised just to dispose of the waste. I
think with Efw, it actually does generate power from the waste
which is very important and obviously, if you can combine heat
and power from the plant, so much the better. From a personal
point of view, I believe in an integrated system, so I do not
think that one should drive in any particular direction. I think
it is horses for courses and, if an Efw plant suited one area,
it may not suit another area. However, without it, without more
energy from waste in the country, I think we will be struggling
as landfill decreases in the future.
Q189 David Taylor: Do you think the
technology has improved and the community concern is misplaced?
Mr Skehens: I think it is misplaced.
I think probably it is up to the industry to continue to explain
what is happening. There is a huge difference in the energy from
waste plant that was built in the 1980s from one that is built
in this century.
Q190 Miss McIntosh: Just on the criminality
and fly-tipping, what can we do to reduce fly-tipping? Are there
sufficient resources and where should the Environment Agency take
the resources from?
Ms Weeks: I think as I said earlier,
I have some real concerns about the resourcing of the Environment
Agency to be able to do a really meaningful job. As the cost of
disposal or treatment goes up, so it becomes more attractive to
the criminal element, and I think there are maybe two types of
fly-tipping. One is a guy who shoves it in the back of his car
and drives out into the country and chucks it on the side, but
then there is the really organised crime as well.
Q191 Miss McIntosh: But we seem to
get it both times in the rural areas.
Ms Weeks: That is right, and,
in order for the Agency to be able to tackle that properly, it
does take a lot of time and resource. I think what is also disappointing
for them and must be rather soul-destroying is that in a lot of
cases, when it gets to court, the fines are quite derisory and
they are not a deterrent, particularly for the organised crime
groups, so I think we need to be looking more at having more resources
for the Agency for them to be able to do it and then really educating
the court system to be able to get meaningful fines, confiscation
of property, et cetera, to make sure that it is not as attractive
to the organised groups to do it.
Q192 Miss McIntosh: But the problem
is that, if they come in the dead of night, you have got to apprehend
them to be able to prosecute.
Mr Hazell: Well, the Agency has
actually followed our advice on that and they are using quite
specialist policing techniques these days. I would emphasise what
Gill has said, that we very strongly support the evidence you
have already had from the Chief Executive of the Agency and we
do agree that a bit of landfill tax should be used to protect
the landfill tax revenue. Also, there is this need for public
information, and this £50,000 budget that Defra has allocated
on the duty of care and registration of carriers requirements
is derisory. Again, if I go back to Lynne Jones's question on
the BREW Programme, the Agency were in a different class from
others when it came to demonstrating what they did with the money
they received and it is a very important point because, in principle,
the money that the Agency takes from our members as regulated
parties should actually only be spent on regulation, and that
is indeed the basic legal framework. The public purse should be
paying for the Agency to deal with the more serious fly-tippers
because the local authorities certainly cannot.
Q193 Miss McIntosh: I think there
is this issue though, with the greatest of respect, when it ends
up on private land and it is so unfair to a private landowner,
especially in the present climate, to be expected to move it.
Mr Hazell: I have read the evidence
and I agree with your question, but the Agency needs to be resourced,
and our advice to this Committee, based on what we have seen of
the techniques they are using and the way they are engaging with
our industry to get intelligence, the Agency needs a ring-fenced
fund from the landfill tax to catch the criminals. As the landfill
tax goes higher, every increase in the landfill tax is going to
make this more of a problem. This is the time for this country
to get tough on the criminals.
Q194 Miss McIntosh: With stronger
penalties from the courts?
Ms Weeks: With stronger penalties,
and also we have gone back to talking about duty of care again,
so, if we can enforce the duty of care so that again, when businesses
hand waste over to somebody they should not and that person then
flytips it, they should be made to put it right. I take your point
about private landowners and again it is just making sure that
the courts, when they are caught, make the orders that people
clean it up.
Chairman: Thank you very much indeed.
Thank you for the crispness of your replies and the quantity of
evidence that you have given us and thank you also for offering
to send us the further material; that is much appreciated.
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