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Time for new economic realism in EU

There is a chill in the air on a cold Saturday morning in Amsterdam. Having breakfast in the kitchen with my wife and daughter Robine, I’m reminded of the frosty mornings at home with my brother and parents while growing up.

With the news on in the background, I remembered that often the only thing my brother and I had in common was our love of fictional TV detective Mac- Gyver. Back then, steeped in four generations of a Dutch recycling business, talk often turned to dad and his work.

My wife asks about a conference I recently spoke at and my daughter asks if I used her idea. Robine explains: “Dad and I were watching the news about the farmers.” She’s referring to an item about the plight of European milk producers: “It’s fair trade for farmers but not their suppliers.”  

Sometimes I think she’s wiser than her years. There, around our kitchen table, a half sleepy nine-year-old cut straight to the heart of the debate around Europe’s circular economy (CE).

She was right. The news had reported a ‘state of emergency’ in the EU dairy market, where the value of milk had fallen a quarter in the past 12 months. We watched as UK-based Farmers for Action organised protests against Asda, Morrisons, Aldi and Lidl, blockaded distribution centres and walked two cows around a supermarket.

Protests against the four grocers were halted while agreements over the new price for milk were finalised. David Handley, chairman of Farmers For Action, said: “I wouldn’t class it as a big victory. This is the start of a realisation by retailers that something had to be done. It is a pity it needed a bit of protest to get them to the table.”

And, shortly afterwards, Morrisons launched a new milk brand, Morrisons Milk for Farmers, costing 10p more per litre than its standard own-brand milk, with the premium paid to dairy farmers. The company also launched Milk for Farmers cheddar cheese, costing 34p a pack more than standard cheese.

For my daughter, it is simple. If it’s fair to focus on the viability of what is in the carton, why not the carton itself?

I am drawn to the condition of our commodity markets – unprecedented resource price volatility, rising quality demands and the failure of businesses such as Eco Plastics. Indeed, resource price volatility between 2005-15 was three times the 1980-2004 average. But while I ‘get’ fair trade for farmers, I doubt there is a public mood for a demo on Downing Street to support the European resource sector.

But in many ways that is precisely what is needed. We need to reassess the opportunities and economics of moving towards a CE. We need a new economic realism if we are to progress UK and EU recycling and resource efficiency.

While landfill levies and the public and private sectors’ innovations have in recent years driven multi-billion pound investment in anaerobic digestion and residual waste technologies, the reality is a UK and EU resource sector with rapidly ageing, increasingly obsolete recycling technology and systems.

The answer, in part, is just as Handley said: getting people to the table. Here, the European Commission’s CE proposals, due shortly, offer an opportunity to reconnect policy in partnership with governments, realising the prospects of the resource sector in the green economy.

A reconnect needs resource leadership in Europe and in member states: strong, stable, clear and consistent policy from political leaders backed by sustainable business models across our economy.

Viridor supports the Commission’s ambition to develop a CE in Europe, where a greater proportion of European resources remain within the continent supported by enhanced reuse, recycling and reprocessing capability. We recognise the realism of 28 member states with differing collections, reuse, recycling and recovery infrastructure, investment profiles, and recycling performance.

We believe the progress and investment of member nations should not be undermined by a one-size-fits-all blanket target which would be wrong for all.

That said, this is a unique opportunity for a balanced package of proposals which are ambitious, evidence-based, feasible for all member states and include measures to boost recycled content of goods. The carrot and stick to my daughter’s milk carton.

Mandatory minimums? Perhaps. More likely measures to ‘nudge’ best practice to become commonplace. For me, on the milk carton, sustainable packaging is more than making a product recyclable – it’s a product made of recycled content supporting a CE.

A boost from Brussels for recycled content would not only make a major contribution to environmental objectives, but it would offer a shot in the arm for businesses, public and third sector partners often struggling to make the sums work for the EU sustainability sector.

Back at breakfast, the flakes and fruit juice are finished. We are gathered round the table and, unlike with my brother, there is no crying over spilled milk. Let’s hope Europe takes a similar journey.    

Herman Van Der Meij is managing director at Viridor Resource Management

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