The Treasury has been accused by MPs of putting short-term priorities ahead of sustainability and potentially increasing future costs and harming investor confidence.
Landfill tax was one of the examples quoted by the environmental audit select committee (EAC) in a report on the sustainability of Treasury policy, with members saying they had found no evidence the Treasury was working with Defra to find new ways of boosting recycling.
Chair Mary Creagh (pictured) said: “The Treasury is highly influential and uniquely placed to ensure the whole of Government works to promote sustainability. But we have seen considerable evidence that it fails to do this.”
Creagh said the department tended not to take full account of the long-term environmental costs and benefits of decisions and, a week before the Autumn Statement on 23 November, she hoped the EAC inquiry would be “a wake-up call”.
The report says MPs heard multiple examples of the Treasury changing or cancelling long-established environmental policies and projects at short notice, with little or no consultation with relevant businesses and industries.
“These decisions caused ‘shock’ and ‘uproar’ among the affected sectors, and some businesses described them as devastating,” it adds.
The report acknowledges that landfill tax had played an important and positive role in diverting waste from landfill: businesses had confidence in the long-term certainty of the tax and invested accordingly. But the committee argued the tax is a ”blunt instrument” and not sufficiently nuanced to drive continued increases in recycling rates.
“We have seen no evidence to suggest that the Treasury has been working with Defra – which has lead responsibility for waste and recycling policy – to find new ways of boosting recycling to achieve our EU targets,” the report says.
“The Treasury should set out in its response to this report its future plans for the landfill tax, and how it plans to support further investment in the waste and recycling sectors.”
The report concludes that, if the Treasury is going to improve its performance and provide greater leadership on environmental sustainability, it must:
- Ensure spending reviews provide strong incentives for collaboration between departments on environmental matters
- Incorporate new evidence on long-term environmental risks and benefits into its frameworks for assessing the value for money of Government interventions
- Increase transparency and accountability by providing publicly available justifications for its decisions
- Work with other departments whose policies affect the environment to ensure the Government’s new industrial strategies promote sustainability
UKWIN national coordinator Shlomo Dowen:
“It is great that the EAC recognise that there is a problem that needs to be addressed with regards to ensuring the Waste Hierarchy is implemented in practice.
”UKWIN is calling for HM Treasury to tax incineration rather than just landfill so as to provide a clear financial incentive to recycle that can drive innovation in collection, sorting and treatment technologies and infrastructure as well as to reward investment in education.”