Funding to fight waste crime, the provisional linking of landfill tax to inflation and measures to support businesses and technology innovations were announced as part of the Budget 2014.
Waste Crime and landfill communities fund
Some £5m will be made available to support the fight against the illegal treatment of waste. The funding will be diverted from the landfill communities fund, which will be reduced to £71m. The cap on contributions by landfill operators will be reduced from 20% to 5.1%.
The Government said this reflected the progress that environmental bodies have made to reduce unspent funds.
Exports and investments
The Government said it would expand its export finance to turn it into the “most competitive in Europe”. The amount of lending available for exporters will be doubled to £3bn.
Manufacturing in the UK will benefit from an extended investment allowance, which applies to qualifying plant and machinery. It will double to £500,000 until the end of 2015.
The availability of business rate discounts and enhanced capital allowances will be extended by three years to encourage new and expanding businesses to locate in Enterprise Zones.
For SMEs, the Government will raise the rate of the research and development tax credit payable to loss making companies from 11% to 14.5% from April 2014.
To support the commercialisation of new technologies, the Government will channel £74m over five years in the business, science and engineering research networked called Catapults, which was created by the Technology Strategy Board to support innovation.
The Budget also included measures to reduce the “burden” of environmental levies on energy-intensive industry, for example paper-making.
The Carbon Price Support rate, which taxes the use of fossil fuel for energy generation, was capped at £18 per tonne of CO² from 2016-17 to 2019-2020.
This could save UK businesses up to £4bn by 2018-19, according to the Treasury.
From April 2015, fuels used to generate electricity by combined heat and power (CHP) plants will be excluded by the Carbon Price Floor.
Steve Lee, chief executive of the Chartered Institution of Wastes Management
“Increasing landfill tax in line with inflation is the outcome we expected and is a pragmatic approach for the medium term.
“While it is important that this valuable mechanism continues to be effective in driving resources out of landfill and back into economically and environmentally beneficial use, there is not the evidence base to support further significant increases at this time.
“However, CIWM would urge the Treasury and Defra to keep this under review and undertake further work to map out the future role of landfill tax to underpin progress on resource efficiency.
“We welcome the clarity on the lower rate of landfill tax with regard to fines from waste transfer stations and other processing facilities and we would expect the forthcoming consultation to propose a staged introduction to give the industry time to put the necessary procedures in place.
“On waste crime, CIWM warmly welcomes the £5m grant in aid from the landfill communities fund. This fund has and will continue to do a lot of good work, but we welcome allocation of a proportion of these funds to tackle this serious problem. The industry has been united in calling on Government to recognise the growing impact of waste crime and we have seen the scale of the problem quantified by recent research from the Environmental Services Association Education Trust. We are pleased that these calls have been recognised and it is essential that this money is put to effective use to build the case for further funding in the future.
“Disappointingly, there is no news on the borrowing powers of the Green Investment Bank and the Budget is weak on the wider resource efficiency front, as expected. However, we are pleased that the Government has acted on a number of important issues for our sector.”
Renewable Energy Association chief executive Dr Nina Skorupska
“We welcome the Chancellor’s acknowledgement that the way to bring down energy costs over the long-term is to invest in home-grown energy sources, including renewables, as well as energy efficiency. The Budget’s acknowledgement of a need to ‘reform and strengthen’ the EU Emissions Trading System is also welcome. But the new, short-term measures announced today in the energy sector do not reflect this ambition – and there is much more in this Budget to please fossil fuel companies than the green economy.
“By freezing the Carbon Price Floor, the Chancellor is rowing back on his own policy and once again moving the goalposts for investors in green energy. Government must explain in black and white how investment in renewables is protected from the freeze, or risk undermining the investment required to replace ageing coal power stations with technologies that can keep the lights on without damaging the climate.”