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Without a strong regulatory base, companies will be loath to invest

Sam Corp

Reading its rhetoric on its flagship Red Tape Challenge website you could be forgiven for thinking that the government is coming from the starting point that regulations will invariably add to the country’s economic burden and that the focus should therefore be to scrap them wherever possible.

Whether that is the intention or not, the Environmental Services Association (ESA) takes a different view. For the sector that ESA represents, environmental and waste regulations serve two very important functions.

First, we must remember that such regulations are primarily designed with the protection of the environment and human health in mind, and while it may be possible to improve them to, for example, to reduce administrative burden, their underlying raison d’être should not be forgotten or compromised.

Second, the regulations, along with effective implementation and enforcement, are also critical to providing the certainty for investment in waste and environmental management infrastructure. Such regulations are therefore a key foundation on which to build the government’s ‘green growth’ agenda.

With the economy struggling to recover from the worst recession in decades, Britain desperately needs businesses which have real potential to create new economic growth and jobs. Waste infrastructure offers excellent ‘green growth’ value as investment in the waste management and recycling sector contributes to several of the Government’s key environmental objectives.

But the ability of the industry to make the large investments required to move the UK’s waste up the waste hierarchy depends on the ability of the Government to ensure a regulatory framework which is fit for purpose, stable, predictable and properly enforced.

If the policy framework does not meet these criteria, then even the largest companies in the sector will struggle to build a strong economic case for investment and their funders will be reluctant to commit capital. Without effective regulation and appropriate sanctions for environmental criminals, there would be no viable market for waste management services.

What is therefore most critical to ESA’s members is not the sheer bulk of regulation but rather the implementation and enforcement of that regulation.

We have concerns about the provision of timely, appropriate guidance from the Government and environmental regulators as well as concerns about the enforcement and regulation of environmental legislation. Recent examples include the last minute clarification of the requirements for dual-waste classification codes, and the scramble to publish the hazardous waste hierarchy guidance by the legal deadline.

Unforeseen delays and uncertainty over regulatory requirements can lead to significant expenditure, add to uncertainty for investors and therefore have a detrimental impact on business planning.

Of course, ESA has and will continue to be an advocate of ‘risk based’ modern regulation which incentivises operators to meet environmental outcomes rather than operational prescription. That, invariably leads to less red tape.

We continue to work with the regulators to develop these approaches and the responsibility deal developed between ESA and Defra demonstrates an alternative to direct regulation to achieve desired outcomes.

The deal commits companies that sign up to promote the waste hierarchy, offer user friendly services to customers and follow good practice in terms of engaging with communities and ensuring that sites are ‘good neighbours’. 

In return, the Government and its agencies have made various commitments including creating a better process to act on industry intelligence on illegal activities supplied through ESA, and reducing the regulation burden on responsible companies, by encouraging compliance through third party auditing where appropriate. 

All the companies represented on the ESA Board have signed up to the Deal, and we hope many more will do so.

Sam Corp is head of regulation at the Environmental Services Association

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