MPs are calling for lower VAT on recycled products, longer warranty periods for consumer goods and a ban on food waste being sent to landfill, in a new report from the Environmental Audit Committee (EAC), which looks at how the Government could help insulate the UK from rising resource prices by creating a more “circular economy”.
The report, Growing a Circular Economy – Ending the Throwaway Society, published by the EAC is calling for Government to help protect the UK against rising resource prices by moving towards a circular economy.
The report recommends lower VAT on recycled products, longer warranty periods for consumer goods and a ban on food waste being sent to landfill, to help instigate the move.
The MPs also say the Government should give new guidance to local authorities in England to standardise recycling collections to create new economic opportunities, as Wales and Scotland have done.
The EAC took evidence on its “Growing a circular economy” inquiry from industry figures such as CIWM’s chief executive Steve Lee, Phil Barton of Keep Britain Tidy, Nick Brown of Coca Cola Enterprises, Dominic Hogg of Eunomia research and consulting and Councillor Clyde Loakes of the Local Government Association.
The Committee explored whether it is possible to de-couple economic growth from natural resource use and the role that household recycling and the waste management sector plays in the circular economy.
Environmental Audit Committee, Joan Walley MP – “We had throwaway economics in the past, but that disposable society simply isn’t sustainable in the twenty-first century”
The report claims that the Government’s current approach to the issues brought forward lacks “ambition and leadership”.
Environmental Audit Committee chair, Joan Walley MP, said: “We had throwaway economics in the past, but that disposable society simply isn’t sustainable in the twenty-first century.
“Less than half of all the stuff we throw away each year is recycled and turned back into something useful, despite prices for raw materials rising across the world. Global food prices have roughly doubled since the beginning of the century, metal prices have trebled, and energy prices quadrupled. These trends look likely to continue as emerging economies expand and the world population grows to 9bn by 2050.
“Unless we rethink the way we run our economy and do business in a different way, environmental problems like climate change will get worse and the cost of living and doing business in the UK could continue to rise.
“The good news is that with the right Government support we can stimulate UK manufacturing, create jobs, grow our GDP and reduce our environmental footprint. We have to create a more circular economy that rewards innovative businesses, values natural capital, and is resilient in the face of rising global resource prices.”
The Committee also heard from leading companies – such as M&S and B&Q – who explained that this makes economic as well as environmental sense.
There are potentially billions of pounds of benefits for UK businesses in becoming more resource efficient, according to the Committee.
Businesses told the inquiry that the vast array of different area-by-area recycling regimes in England is confusing, sub-scale and makes it harder for companies to access valuable materials that could be reused.
The variety of different recycling services also means there cannot be consistent on-pack information about a product’s recyclability to help households.
The report suggests Government should give new guidance to local authorities in England to standardise recycling collections to create new economic opportunities, as Wales and Scotland have done.
“It is possible to get recycling rates to nearly 70 percent as other European Countries and some UK councils have demonstrated”
The Environmental Audit Committee also wants the Government to support EU proposals to increase recycling rates to 70 percent by 2030. It points out that while England has improved its recycling rates since the beginning of the century from 11 percent to 43 percent, these have started to plateau, and it still has a considerable way to go to catch up with the best performing countries, like Austria and Germany.
Joan Walley MP added: “It is possible to get recycling rates to nearly 70 percent as other European Countries and some UK councils have demonstrated. There is about 3 percent to 5 percent of waste that you cannot avoid landfilling at the moment, but with better product design even that might be eliminated.”
Lower VAT on recycled products
The report recommends that the Government takes steps to reform taxation and producer responsibility regulations to reward companies that design greener products. Differential VAT rates should be introduced based on the environmental impact or recycled content of products. Tax breaks should also be considered for businesses that repair goods or promote reuse.
Zac Goldsmith MP, Member of the Committee: “Designing waste out of the way we live and do business is therefore a defining challenge. What’s clear is that businesses that take this challenge seriously will flourish, and those that don’t will eventually fall behind. But Government has an important role too, and this report highlights some of the steps it needs to take.”
Extended warranties and eco-design
The Government should work with the EU to establish eco-design standards across a range of products to make them easier to repair, upgrade, or recycle. Such standards should phase out products made from materials that cannot be recycled and encourage companies to design goods that have a clear end-of-life recovery route and are fabricated using easily separable and recyclable components.
The Government should also work with industry sectors to set longer minimum warranty periods for consumer products to encourage businesses to adopt more resource-efficient business models.
The Government should also ban councils from sending food waste to landfill. Just 400,000 tonnes of food waste is separately collected for organic recycling in the UK out of the 7.2 million tonnes thrown out by households every year; around 6 percent. Instead this food waste could be collected separately and composted or used in anaerobic digesters to produce biogas and renewable energy and fertiliser.
The MPs found that the Government’s current approach to these issues lacks ambition and leadership. It is characterised by small-scale schemes and although responsibilities are split across a number of departments, there is no strategic plan to achieve systemic change linked to industrial policy.
Furthermore, Defra has dramatically cut funding for resource efficiency initiatives. The Committee argue that the Government should learn from the strategic vision that other countries have adopted and embrace the EU’s ambitious targets for improving resource productivity, supporting business in achieving the economic and environmental benefits of a more circular economy.
Joan Walley MP, concluded: “The Government must do more to ensure that the right conditions are in place so that many more businesses can shift from a linear approach to a circular one. We heard from business how successful green taxes such as the landfill tax had been in driving change in the waste industry. We need the same strong tax signals from the Treasury for the circular economy”
For the full report CLICK HERE