Issuing guidance on recycling collections, cutting VAT on recycled products and banning food waste from landfill could potentially benefit the UK economy by billions of pounds per year, according to a report by the UK Parliament’s House of Commons Environmental Audit Committee.
Commons committee calls for food waste landfill ban
31 July 2014
The committee sourced its information from a range of businesses that are taking steps to a more ‘circular economy’ approach, including the introduction of new business models that sell a service rather than a product, or use innovative materials and processes to reduce environmental impacts.
Following the publication of the report, MPs have called for lower VAT on recycled products, longer warranty periods for consumer goods and a ban on food waste being sent to landfill, all in aid of insulating the UK from rising resource prices by creating a more circular economy.
"We had throwaway economics in the past, but that disposable society simply isn’t sustainable in the twenty-first century,” stated Environmental Audit Committee chair, Joan Walley MP.
“Less than half of all the stuff we throw away each year is recycled and turned back into something useful, despite prices for raw materials rising across the world.”
Walley also noted that global food prices have roughly doubled since the beginning of the century, metal prices have trebled, and energy prices quadrupled: trends which look likely to continue as emerging economies expand.
“The good news is that with the right Government support we can stimulate UK manufacturing, create jobs, grow our GDP and reduce our environmental footprint,” continued the Committee chair. “We have to create a more circular economy that rewards innovative businesses, values natural capital, and is resilient in the face of rising global resource prices."
Guidance Needed for Recycling Collection
The report discovered that businesses found the vast array of different area-by-area recycling regimes in England confusing and sub-scale and that this made it harder for companies to access valuable resources that could be reused. The wide variety of different recycling services was also found to reduce the consistency of on-pack information about a product’s recyclability to help households.
The MPs urged government to give new guidance to local authorities in England to standardise recycling collections to create new economic opportunities, just as Wales and Scotland have done.
The Environmental Audit Committee also wants the Government to support EU proposals to increase recycling rates to 70% by 2030.
It noted that while England has improved its recycling rates since the beginning of the century from 11% to 43%, this increase has started to plateau, and still has a considerable way to go before it can catch up with the best performing countries, like Austria and Germany.
To view the Circular Economy Report click here Circular_Economy_Report_FINAL_High_Res_For_Release.pdf
"It is possible to get recycling rates to nearly 70% as other European Countries and some UK councils have demonstrated,” commented Walley. “There is about 3% to 5% of waste that you cannot avoid landfilling at the moment, but with better product design even that might be eliminated."
Hope to lower the VAT for recycled products
It was also recommended in the report that the Government takes steps to reform taxation and producer responsibility regulations to reward companies that design greener products.
According to the Committee, differential VAT rates should be introduced based on the environmental impact or recycled content of products. Tax breaks should also be considered for businesses that repair goods or promote re-use.
"Designing waste out of the way we live and do business is therefore a defining challenge,” commented Zac Goldsmith MP and member of the Committee.
“What’s clear is that businesses that take this challenge seriously will flourish, and those that don’t will eventually fall behind. But Government has an important role too, and this report highlights some of the steps it needs to take," he continued
Extend Warranties and Make Products Longer Lasting
The report also pushed the Government to work with the EU to establish eco-design standards across a range of products to make them easier to repair, upgrade, or recycle.
Such standards, it said, should phase out products made from materials that cannot be recycled and encourage companies to design goods that have a clear end-of-life recovery route and are fabricated using easily separable and recyclable components.
In addition, the Committee commented that the Government should work with industry sectors to set longer minimum warranty periods for consumer products to encourage businesses to adopt more resource-efficient business models.
"We all know the frustration when we have to throw something away even though it’s just past its warranty,” said Walley. “In our disposable society it often makes more financial sense to buy a new one than get something repaired.”
“Things are not made to last and many manufacturers don’t make it easy for us to fix things,” she added.
According to Walley, Government should work with companies to incentivise and encourage design that makes it easier to repair products and finally remanufacture or recycle them. Ministers should also work with industry to extend consumer warranties so that companies are encouraged to build things that last.
The committee also urged the Government to ban councils from sending food waste to landfill.
The MPs noted that only 400,000 tonnes of food waste is separately collected for organic recycling in the UK out of the 7.2 million tonnes that is collectively thrown out by households each year; around 6%.
Instead, the Committee said that this food waste could be collected separately and composted or used in anaerobic digesters to produce biogas and renewable energy from waste and fertiliser.
"Food waste could be used to produce biogas for energy and fertiliser for our farming system yet at the moment too much is thrown into landfill where its value is lost and it produces climate-changing gases like methane," commented Walley.
The MPs found that the Government’s current approach to these issues lacks ambition and leadership.
“It is characterised by small-scale schemes and although responsibilities are split across a number of departments, there is no strategic plan to achieve systemic change linked to industrial policy,” the Committee said in a statement. “Furthermore, Defra has dramatically cut funding for resource efficiency initiatives.”
The Committee argued that the Government should learn from the strategic vision that other countries have adopted and embrace the EU’s ambitious targets for improving resource productivity, supporting business in achieving the economic and environmental benefits of a more circular economy.