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Report presents environment as key to growing economy

Last week saw the publication of a report The Commission on Environmental Markets and Economic Performance Report, published by the Department for Environment Food and Rural Affairs (Defra). It aims to advise the Government on how the UK could make the most of the potential economic benefits including the waste management and recycling industry. Commissioners included business, trade unions, and non-governmental organisations. The document's first recommendation says that the Government should: set credible, long-term environmental goals, consistent with business investment cycles. One means of achieving this is through building national consensus by opening decision making to wider society. The report goes on to state that goals can help provide potential investors with clear signals on the direction of policy. For example, the Commissioners propose that policy on material resources would benefit from a clear long-term direction. It recommends that a Products and Material Strategy, developed in conjunction with stakeholders and setting out consensus-based targets for resource efficiency, should be an early objective for the newly established Products and Materials Unit within Defra. Another important recommendation by the CEMEP included the following: Government should ensure that it sets out and adheres to well-defined timetables for the implementation of environmental legislation. Examples of where this would be relevant are the proposals in Englands Waste Strategy 2007 to consider landfill bans for certain materials. It continues to state that relevant legislation must be implemented according to a clear and unchanging timetable. The report gives the example of the implementation of the Waste Electrical and Electronic Equipment (WEEE) Directive to show the impacts of delays on investment. The Directive was due to come into play by August 13 2005 but was actually implemented in July 2007. It said: Many businesses made investments in anticipation of an increase in material to process, on the basis of the initial implementation policy and timetable. For example, one company built a large fridge recycling plant in 2002, opened a WEEE computer recycling plant in December 2005 and took over a plastic recycler in Germany in October 2006. The delays, combined with a series of policy changes have had a negative impact on the return on such investments. Investments in different waste technologies should be picked carefully by Government. The CEMEP advises the Government to be careful not to pick winners by focusing its attention and support on a single or small number of technologies to address environmental challenges. It is impossible to predict which technologies will be viable and competitive in the future, because of uncertainties both in the costs of development and deployment, the report states. Therefore, the Commissioners recommend that a range of candidate technologies should be supported. The Commissioners acknowledge in the report that the waste management and recycling sectors dominate the core environmental goods and services market in the UK. In order to tap into environmental markets the CEMEP acknowledge that business must be involved. Large environmental goods and service companies are increasingly multinational and geographically mobile. They are currently investing in the UK because they consider the business environment favourable, but could readily be attracted elsewhere if conditions were to change. This highlights the need for the UK to be competitive in attracting investment from multinationals in the sector. In 2005, the waste management industry was worth £8 million. The report highlights that projections based on previous growth suggest that the environmental sector will grow to £34 billion in 2010 and to £46 billion by 2015. In light of this the CEMEP advises businesses to: Address the whole life cycle of products, to enable all environmental impacts from cradle to grave (waste to landfill) to be identified and reduced and investigate the scope for cradle to cradle (recycling) production, where recycled materials become the feedstock for new products. It suggests that businesses should try to prevent construction materials from going to landfill. Its figures show that despite the fact that glass is recyclable, over 70% of the 3.6 million tonnes of glass flowing through the UK economy each year is sent to landfill. The Commissioners recommend that businesses should cooperate with other companies to move towards the cradle to cradle position. The CEMEP report was heavily influenced by the Stern review on climate change. After it was published it provided the watershed for Gordon Brown as Chancellor of the Exchequer to establish the Commission on Environmental Markets and Economic Performance (CEMEP) in November 2006. Sterns main conclusion was the following: the benefits of strong and early action on climate change outweigh the economic costs of not acting. The Government is considering the findings of the Commission and will be responding in early 2008.

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