3 Leadership and ambition
Leadership
59. The Government acknowledged the potential of
the circular economy in its 2013 Future of Manufacturing report[141],
and its Waste Prevention Programme for England sets out
a range of such initiatives.[142]
It also endorsed the business-led Circular Economy Task Force,
convened by Green Alliance. The Government outlined for us a number
of steps it was taking to support a circular economy.[143]
It is supporting circular economy innovation through the work
of the WRAP and the Technology Strategy Board (paragraph 17),
although it has stopped funding the National Industrial Symbiosis
Programme (paragraph 20).
60. Several of our witnesses highlighted that progress
compares unfavourably with initiatives introduced by other countries
and UK devolved administrations. Some of our witnesses wanted
BIS to be given a lead role on the circular economy, and a new
Office of Resource Management to be established. The Resource
Association said:
We note with a mild degree of envy that the French
now have a dedicated Minister for the Circular Economy in Ségolène
Royal. Alongside an Office of Resource Management (or similar
named co-ordinating function), a similar post in Government may
do much to widen awareness of the opportunities in the circular
economy and be a catalyst for change.[144]
CIWM saw:
… poorly resourced departments, especially
Defra; lack of co-ordination between departments; a total withdrawal
from policy and intervention on commercial and industrial wastes;
poorly resourced local authorities; under-mining of local authorities
and their waste services; reduced funding for agencies such as
WRAP and dis-jointed planning for resources at a strategy level
and dis-jointed thinking on government finance support for infrastructure
in this sector.[145]
The Government has recently announced that the Minister
for Business and Energy has been made a champion for the bio-economy,
and a new steering group will be established to make the most
of opportunities from waste.[146]
61. Defra has cut the funding to its main delivery
body for resource efficiency work. Defra's funding for WRAP has
fallen from £56m in 2009-10 to £26m in 2013-14 and subsequently
to 15.3m in 2014-15.[147]
Liz Goodwin, Chief Executive of WRAP, told us that as a result
of such budget cuts it had stopped its work on the construction
sector and the built environment, and reduced its work on food
waste.[148] Sir Ian
Cheshire told us:
For the business community, WRAP is very highly
valued as an expert partner and has been involved in a lot of
different, very successful projects. It is one of the areas where
we were alarmed to see the scale of the funding cuts. I think
[WRAP] cope remarkably well, but I still think there is an opportunity
to rebuild some of that in a more targeted way.[149]
Dan Rogerson told us that some of the reduction in
funding was a result of projects finishing, but acknowledged that
Defra had scaled back support for WRAP as a result of wider cuts
to Government spending:
We have not been able to offer the same funding
to WRAP that we have in the past but we are still offering significant
funding to them and they are continuing to deliver a lot of work
for us. We are very grateful for that and all the expertise they
have.[150]
62. DS Smith recommended that Local Enterprise Partnerships,
regional networks and trade associations should play a key role
in sharing information and expertise. International Synergies
Limited suggested that the Government "use a very small proportion
of the European Regional Development Fund money allocated to the
business led LEPs as a vehicle to re-launch a nationally co-ordinated
but LEP directed industrial symbiosis programme."[151]
Dan Rogerson told us that a "number of [LEPs] are looking
at opportunities for getting into emerging sectors and many of
those will be around making better use of the resources that are
available"[152],
but added:
I do not think the approach of local enterprise
partnerships is for us to say: "That LEP over there, you
must do something here on the circular economy". That is
not the approach that LEPs are set up to deliver.[153]
In our Sustainability in BIS inquiry we found
a similar Government attitude towards the scope for environmental
considerations to be taken into account in BIS Regional Growth
Fund applications.[154]
Ambition
63. Professor Tim Jackson told us that an important
way of judging whether the circular economy is having an impact
was to look at global material flows:
The best evidence that we have on that is that
we are not actually making progress. For example, a recent study
on the so-called material footprint found that for every 10% of
increase in GDP, you have a 6% increase in material footprint.
If you look at the UK in particular, our material footprint exceeds
our growth in GDP over the past 20 years.[155]
The Environmental Industries Commission recommend
that Government should put in place a framework of indicators
on resource efficiency, including indicators for each industrial
sector, to enable industries to monitor and benchmark their performance.[156]
European Commissioner Janez Potoènik told us that the European
Resource Efficiency Platform had recommended a resource productivity
target as a way of monitoring progress. He explained:
The best proxy would be to 'raw material consumption'
compared with GDP, because it is simple. It is constituted from
domestic and imported materials, so imports do not bias the numbers.
EUROSTAT are already producing it for quite a few member states.
… One of the recommendations was that, from now to 2030,
we would increase that resource productivity by a minimum of 30%.[157]
Jonathan Tilson from BIS told us that the Government
currently lacked the information to be able to track how effectively
businesses are taking up efficiency opportunities, with "quite
a lot of work still to do to develop the metrics and a better
understanding".[158]
64. As many natural resources are produced overseas,
increasingly re-using or recycling these materials may reduce
the need for imports and give the UK supply chain more certainty
over critical materials at stable prices. Professor Tim Jackson
told us that "it is such a fundamental part of the success
of an economy in the long run to know that its supply chains are
secure and that it does not have resource dependencies it cannot
ever meet".[159]
The Government told us that it had cancelled a potential study
on resource risks and departmental priorities,[160]
but that a Cabinet Office led study was now looking at 20 critical
materials for the economy.[161]
Nevertheless, many organisations wanted the Government to take
a more strategic approach to resources which proactively engaged
with businesses. CIWM wanted "an industrial strategy from
a resources perspective".[162]
EEF, in their Materials for manufacturing report, observed
that America, Germany, South Korea and Japan all had sophisticated
strategies for resource security[163]
and called for the Government to introduce a "Stern for Resources"
review.[164]
65. One way of underpinning a stronger commitment
to a future circular economy would be by engaging positively with
the European Commission's recently published Circular Economy
Package.[165]
Commissioner Potoènik told us that the European Commission's
vision was that "by 2030 each country should recycle everything
it is possible to recycle", and that
"countries would not landfill anymore".[166]
This is reflected in the targets of the Circular Economy Package,
which requires Governments to recycle 70% of municipal waste and
80% of packaging waste by 2030. The Package also includes
a zero-waste-to-landfill policy for plastics, paper, metals, glass
and bio-waste by 2025, as well as initiatives around eco-design.
66. The Scottish Government has introduced zero waste
regulations to help support improved recycling, and is developing
a roadmap for a circular economy in Scotland.[167]
Scotland's zero waste plan, published in 2010, includes a target
to increase recycling rates to 70% for all waste arising in Scotland
by 2025, and a maximum of 5% of waste to landfill.[168]
In England, household recycling rates have plateaued in recent
years, and the National Audit Office has identified a risk that
the UK may not meet the current 50% target for 2020.[169]
Dan Rogerson welcomed the EU emphasis on a circular economy,[170]
but told us that "we would not be seeking to have binding
targets for member states"[171]
and that there was "very little point in setting a target
that is not achievable".[172]
67. Our previous inquiry on Plastic bags examined
the Government's proposals to introduce a mandatory 5p charge
on plastic bags in England to encourage re-use and reduce litter
and waste. We welcomed the initiative, but found that the series
of exemptions were likely to be confusing for shoppers and would
weaken the environmental message and effectiveness of the scheme.[173]
The Government's decision not to include small businesses in this
iconic scheme was a particularly striking example of its lack
of ambition to take the steps needed to embed a more circular
approach throughout the economy.
68. Reducing the dependency on primary resource
use for economic growth is an essential part of moving to a more
sustainable economic system. Some businesses are showing real
leadership and innovation to adjust their business models and
become more resource efficient. However, the Government must do
more to ensure that the right conditions are in place so that
many more businesses shift from a linear approach to a circular
one. Targets for resource productivity could provide an important
tool for delivering the necessary change by showing businesses
that Government is committed to supporting the changes required.
The European Commission's proposals to achieve a 70% recycling
target by 2030 could do much to promote innovation.
69. The Government should promote and build on
existing initiatives to identify good practice on the circular
economy and support businesses, in particular the work of WRAP.
However, instead of scaling up this work, it is cutting it back.
It cancelled a review into resource risks and departmental priorities,
and responsibilities across Government remain unclear. The picture
painted in our inquiry is of a catalogue of small-scale Government
initiatives and support rather than a strategic plan to achieve
systemic change, clearly linked to industrial policy. A new steering
group on the bio economy, whilst welcome, is not of the same order
of response as the potential Office of Resource Management that
some have suggested. Even its proposal to introduce a charge for
plastic bags is weakened by a series of exemptions, and it should
re-consider its decision not to include all businesses in the
scheme.
70. The Government should learn from the strategic
vision and ambitious targets that other countries have adopted.
It should embrace the EU's ambitious targets for improving resource
productivity, and support business in achieving the economic and
environmental benefits. It should also support the European's
Commission's proposals for recycling and the accompanying proposed
targets, and use these to drive change.
71. The Government needs to ensure that there
is sufficient funding available for agencies such as WRAP and
the Technology Strategy Board to support this transition. Some
of the revenues from the Landfill Tax and taxes on non-circular
products (paragraph 51) should be used to directly support the
circular economy and reverse the cuts in WRAP's funding.
72. The circular economy must be embedded into
industrial strategy, based on resource risks and covering key
sectors. Local Enterprise Plans should take identify steps to
mitigate these risks and opportunities to innovate. It should
also be mainstreamed into departmental business plans, with clear
responsibilities for driving this forward in both BIS and Defra
and across Government.
141 Government Office for Science Future Manufacturing Project Foresight Report
(2013) Back
142
The Government Prevention is better than cure: the role of waste management in moving to a more resource efficient economy
(December 2013) Back
143
Government (GCE0045) paras 22-60 Back
144
Resource Association (GCE0023) para 6 Back
145
Chartered Institution Of Wastes Management (GCE0043) para 28 Back
146
Government response to the House of Lords Science and Technology Committee Report: 'Waste or resource? Stimulating a bio economy?
(June 2014) Back
147
The Government Review of Defra funding for WRAP (Waste and Resources Action Programme) Summary report of the review and responses to the opportunity to comment document
(November 2013) Back
148
Q48 Back
149
Q52 Back
150
Q255 Back
151
International Synergies Limited (GCE0019) Back
152
Q260 Back
153
Q262 Back
154
Environmental Audit Committee, Seventh report of session 2013-2014
Sustainability in BIS, HC 613 para 21 Back
155
Q133 Back
156
Environmental Industries Commission (GCE005) para 5.1 Back
157
Q205 Back
158
Q252 Back
159
Q146 Back
160
Q241 Back
161
Q243 Back
162
Chartered Institution Of Wastes Management (GCE0043) para 32 Back
163
EEF Materials for manufacturing (July 2014) p11 Back
164
Ibid, p10 Back
165
European Commission Communication on: Towards a circular economy: A zero waste programme for Europe
(July 2014) Back
166
Q209 Back
167
Scottish Government (GCE0054) Back
168
Scottish Government Scotland's Zero Waste Plan (2010) Back
169
National Audit Office Environmental Protection (July 2014), para
2.46 Back
170
Q231 Back
171
Q227 Back
172
Q226 Back
173
Environmental Audit Committee, Eleventh Report of Session 2013-14,
Plastic Bags HC 861 Back
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