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Treasury accused over flat-lining recycling rates

Treasury

Industry figures have blamed Treasury policy for flatlining recycling rates and called for a review of landfill tax.

The Environmental Services Association (ESA) said the department was reluctant to adopt more progressive measures as it feared a reduction in landfill tax revenue.

The comments came in response to a call to evidence from the Environmental Audit Committee (EAC) into the Treasury’s contribution to meeting recycling targets.

It said it believed the Treasury objected to some of the European Commission’s circular economy proposals because “landfill tax revenues would be impacted too severely by the package of measures”.

“This conflicts with Defra’s objective of reducing waste to landfill, and ultimately hinders the UK’s progress in maximising the resource potential of waste.”

The ESA said that a ”risk averse” approach meant that energy-from waste plants funded by the private finance initiative had insufficient spare capacity for current demand and this was a ”missed opportunity”. It suggested that lower effective tax rates on infrastructure investment would help create a level playing field with the rest of Europe.

Reduced funding to local authorities had hit recycling rates, it said, with many councils collecting less green waste after having to charge for collection.

“Based on current performance and trends, it is clear that we will struggle to meet our current recycling targets, and there is no HM Treasury policy to enable us to reach them,” it said.

“Lower funding for local government will have a damaging effect on recycling performance. Already we have seen household recycling rates go backwards, and this could become a trend if the treasury continues to squeeze local authorities’ resources.”

The Resource Association was similarly critical, saying: “Withdrawal of statutory targets on councils by DCLG, uncertainty and lack of clarity about the long term intentions for landfill tax, cancellation of the ‘Stern for Resources’ research from HMT, no indication of any future review of resource taxation and fiscal instruments to support ‘demand-pull’ for recycling, all paints a picture of policy stasis which has contributed directly to the flat-lining and now reducing recycling rates for municipal waste in England.”

Recycling firm DS Smith added: “HM Treasury policy over the course of the last Parliament had a detrimental effect on recycling projects. The introduction of wide-ranging budget cuts across most departments and at local authority level meant there was less funding for communications campaigns, essential to raise awareness of the need to recycling.

“Numerous reports still show the public are unsure of which materials to put out for recycling and lack understanding about what happens to these materials once they are processed.”

It expressed concern that short-term issues like tackling flooding would continue to take precedent over other environmental concerns such as recycling.

However, many contributors were complimentary about the Treasury’s £20m pledge to the Environment Agency to fight waste crime over the next five years and £3.2m to HM Revenue & Customs to address landfill tax evasion.

  • Meanwhile the Environment Agency (EA) has listed “reduced waste and waste crime” in its Ambition to 2020 report, set to run alongside upcoming Defra’s 25-year plan.

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