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Beis urged to make circular economy shift

More than £9bn could be added to the UK economy by 2030 by integrating circular economy (CE) principles into the country’s emerging industrial strategy, according to a report launched at RWM by Suez.

The report, A Resourceful Future – Expanding the UK Economy, carried out by consultancy Eunomia, proposes a series of policy measures aimed at the newly formed Department for Business, Energy and Industrial Strategy (Beis).

It calls on Beis to encourage greater use of secondary raw materials in products manufactured in the UK through minimum recycled or reused content in public procurement of specific goods.

Differentiation on tax regimes such as VAT for recycled and primary materials is also suggested, making use of greater flexibility to do this following Brexit.

Other proposals include:

  • Obligating manufacturers to offer longer term warranties to influence greater durability or repairability of goods
  • Enhanced producer responsibility, where producers of a wider range of goods are obliged to pay the cost of recovering and recycling products and product packaging
  • Research and development tax breaks for innovative processing techniques

The report says such measures would help to ensure that a significant percentage of the 14 million tonnes the UK exports each year are instead used domestically, which it says could generate around £650m annually for the economy.

This is measured by gross value added (GVA), calculated by the production of goods and services, together with the wealth created by the profits they generate; payments made to employees from those businesses; and all related taxes that flow back to the Treasury.

It says the greatest economic boost would arise from a 70% recycling level achieved across the UK by 2030.

This would result in reductions in UK carbon emissions and falls of up to four million tonnes a year in greenhouse gas emissions (27 million tonnes by 2030) – equivalent to 3.4% of the UK’s 1990 emissions.

David Palmer-Jones, Suez UK chief executive, said: “Our sector currently recovers about £15bn-worth of value from waste in the form of secondary materials and energy. But, because of a disjoint between waste policy and industrial policy, some 50% of recyclates and 90% of waste-derived fuel is exported to overseas markets, even though the UK is a net importer of primary raw materials and of energy.

“Re-shoring and reintegrating these streams into the UK economy will not only help to future-proof the UK against resource supply risks, but also create employment in new waste-related activities.

“Our report offers a vision of an industrial strategy informed by CE principles that will be suitable both for the UK’s current membership of the EU and, importantly, one that is sustainable both through any Brexit negotiation period and beyond for an independent UK.

He said Suez was working with Jaguar Land Rover, which had reported economic benefits from incorporating UK-generated recycled aluminium into its domestic vehicle production.

Eunomia chairman Dominic Hogg said: “An environmentally informed industrial strategy would not only look at how we might use these materials within industry, but would look to the waste and resources sector to see how industries could be supplied with the materials they need.

“There is a real opportunity to develop a symbiotic relationship between the waste and resources sector and other industrial sectors and, in doing so, to support the growth of the economy. The word ‘waste’ should become a redundant one in our vocabulary.”

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