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Finding funding options

To meet 2005 recycling targets, England needs to recycle 25% of its waste. Current Government figures show that for 2002/3, 14.5% was recycled; meaning an increase of more than 10 percentage points is needed.

Naturally funding is one of the first things that springs to mind in the waste battle. But is it working? Or is a radical overhaul needed?

Professor Chris Coggins, chairman of the Chartered Institution of Wastes Management waste and resources special interest group, believes so. He has written a report into local authority funding and thinks that other funding options need to be considered, such as variable charging or making waste management into a utility-type structure.



Sources

There are three main sources of local authority funding: historic Government grants, new grants under the Department for Environment, Food and Rural Affairs (DEFRAs) bidding system and Private Finance Initiative (PFI) funding.

Historically local authorities received income from local sources currently Council Tax and various Government grants. Specifically, waste management funding is provided through the Environmental Protection and Cultural Services grant. But this funding is not ringfenced and it is estimated that only 1.5% of this is spent on waste disposal and collection.

During the 1990s other funding sources were developed including recycling credits and Packaging Recovery Notes but few benefit all authorities, according to Coggins. They are not ringfenced and waste and recycling may not be high on the agenda, he says.

In the past few years however, DEFRA has stepped in to help fill the gap, granting large sums of money to local authorities for waste management.

In October, DEFRA announced it would make available a further £135 million to local authorities in England under its Waste Minimisation and Recycling Fund. About £90m will be made available in 2004/5 and £45m in 2005/6.

The money has not been enormous but it has been helpful, Coggins says.

But its helpfulness is often tinged with negatives. Applying for grants costs local authorities a lot in time and effort and there is a problem with what to do when funding runs out.

They have to allocate a lot of time and effort to put these bids together and then they dont always win, he says.

In the first two rounds a lot of poor-performing local authorities were granted funding. But for others it seemed that if you were already investing in waste, then you dont need grants. It left a lot of better-performing authorities thinking whats the point?

Coggins added: Then theres local authorities that wonder what to do when the funding runs out. Some turn down funding because they have to pick up the bill when the revenue runs out.



Application

But applying for funding in the first place seems to be the biggest problem.

Theres very little guidance for DEFRA. It should look at doing what the Waste and Resources Action Programme (WRAP) does when funding local authority communication campaigns. It has done a lot of work on guidance.

Coggins knows from personal experience that guidance is crucial. I have worked with a lot of local authorities and they are clearer on how to apply for WRAP funding than DEFRA funding. Its a pity that DEFRA doesnt follow suit.

DEFRA may also have to look at the amount of funding it is distributing and whether it is enough to stem the tide of waste.

Coggins says current funding levels almost negates what is paid in Landfill Tax. Local authorities are paying for about 52% of that tax. From next April (when the tax reaches £18) local authorities will have to find another £60 million to pay Landfill Tax.

Its a large chunk of money, more than they pay now. But it begs the question, how are they going to pay for new facilities when they are paying that much in tax? Beyond capital investment, Government money will not make that much of a difference.

Another source of

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