What will a post-Brexit waste management sector look like?

Written by: David Burrows | Published:
Banksy's Brexit mural in Dover

With Brexit negotiations under way and Leave campaigner Michael Gove in charge of Defra, what’s in store for the waste management sector?

Michael Gove’s return to the Cabinet in June was surprising, but his placement at Defra left many completely baffled. This was a man who reportedly tried to ban climate change from the geography curriculum when he was education secretary.

“He couldn’t help playing to the Tory climate-sceptic audience,” said the former secretary of state for climate change, Ed Davey. “He could also be a danger on transposing EU environmental regulations into British law. We know he has a natural inclination to reduce regulation.”

But the man who sat opposite Davey in the coalition government’s Cabinet meetings appears very different from the one who gave his first speech as environment secretary a couple of weeks ago. “I am an environmentalist,” he said. “The air we breathe, the water we drink, the food we eat and the energy which powers enterprise, are all threatened if we do not practise proper stewardship of the planet.”

It was music to the ears of those gathered at the headquarters of the environmental group WWF-UK, but was he playing to an audience of green campaigners or is Gove seriously considering some radical new policies?

This was a wide-ranging, 5,000-word speech, and it will be no surprise to hear that a significant chunk of it was dedicated to farming and fisheries. Experts approached by RWW the week before had admitted that their impression was that waste policy came “a little bit down the pecking order”.

But resource use got a decent airing. Improved incentives for reducing waste and litter are on the way, as well as a review of the penalties available to deal with polluters. Many in the waste sector will have been pleased to hear talk, too, of changes to the way recycling is measured.

“We can incentivise recycling according to the environmental impact and value of the material, rather than a crude weight-based target that currently focuses recycling on things that happen to be heavy,” the environment secretary said.

Plastics will be a particular focus. Legislation to ban the use of microbeads will be introduced later this year, with Defra also set to “explore” other ways to reduce the amount of plastic that ends up at sea. Marine litter has shot up the public agenda, so this could well have been another attempt to appease certain stakeholders. More telling than these warm words will be Gove’s actions in the months to come.

For example, consider that the Environmental Audit Committee, chaired once again by Mary Creagh, may well reopen its inquiry into disposable packaging. And that means a deposit return scheme on plastic bottles or a tax on takeaway cups may well show up in any final recommendations. Will these policies be hard for the previously regulation-reticent Gove to swallow?

An elusive plan

Time will tell, but it’s worth noting that Gove also used his speech to release new figures showing that seven of the UK’s largest food retailers have issued 83% fewer plastic bags since a 5p tax was introduced in October 2015. Readers may recall that the last set of figures, also showing how successful the levy has been, were announced by Thérèse Coffey within a couple of weeks of her becoming waste minister in July last year.

Coffey, who kept her position in the post-election reshuffle, has also recently expressed some doubts over weight-based targets. “This shows she is thinking about the longer term,” says Roy Hathaway, European policy advisor at the Environmental Services Association (ESA).

So is her boss, it seems. Gove accepted that Defra’s 25-year environment plan has been long in the making, before signalling a potential change in gear (but no firm date for publication). He also promised a “renewed strategy on waste and resources that looks ahead to opportunities outside the EU”.

“Now that [the Brexit] decision has been made, it creates new opportunities, and challenges, for the British Government. And nowhere more so than in the area of environmental policy,” he added.

Some of those in the waste industry tend to agree. “I take issue with those who said the vote [to leave the EU] was a complete disaster,” says ESA’s Hathaway. “This gives us a chance to tailor waste policies to the UK rather than a ‘one size fits all’ for 28 countries.”

Matthew Farrow, executive director at the Environmental Industries Commission, says the opportunities – including a move away from tonnage-based targets and avoiding anomalies like “occasional conflicts between the waste hierarchy” – must be set against the “major uncertainties” Brexit entails.

“Investors are willing to invest against UK policy shaped and driven by binding EU Directives,” he explains, but “they may be less keen to do so against, say, a Defra ‘25-year environmental plan’, which may be light on the detail of waste policy”.

That Brexit will distract the majority of policymakers for the next couple of years (and likely beyond) remains a major concern. Peter Jones, principal consultant at Eunomia, wonders whether there is “sufficient bandwidth” in the Defra team to deal with Brexit and produce a “properly thought through” waste plan.

“One of the tragedies of Brexit is that we will spend a lot of the civil service’s intellectual capital on Brexit, when we could have been using it to creatively implement EU rules,” he adds.

The Great British Shake Off

Reaction to the Great Repeal Bill – which will “convert the existing body of EU environmental law into UK law” – when it was published in mid-July was mixed. As Jones suggests, the experiences to date suggest that a copy-and-paste job can be the easy and ineffective option.

“Look at the record on implementation of the 2008 Waste Framework Directive, where there has never been any enforcement action of any kind on the waste hierarchy,” Jones says. “It’s been the same story with separate collections.”

The government said in July that the ‘conversion’ will happen at the date of exit, from when the UK will also cease to be subject to decisions of the Court of Justice of the European Union (CJEU) – although past decisions will remain applicable to the interpretation of UK law.

“This will certainly impact waste management legislation, which is heavily influenced by CJEU decisions,” explains Laura Tainsh, partner and waste management specialist at law firm Davidson Chalmers. “With the Scottish Parliament and Welsh Assembly stating they will not give their consent to the Bill as it stands, there is also a very real prospect that further negotiation on these details lies ahead,” she adds.

Devolution is worth considering for a moment. England’s waste and resources sector has been largely left without a future plan, while Scotland and Wales have kicked on with aggressive goals and new strategies. “Industry doesn’t like being regulated but it likes a direction of travel,” says Adam Read, practice director for resource efficiency and waste management at Ricardo.

Producing post-Brexit policy

It’s no surprise therefore to hear talk of a potential “chilling effect” on investment in waste infrastructure as Brexit is negotiated. At a stakeholder meeting organised by Defra in July there was a lot of chatter about this very topic, and whether the new industrial strategy – due to be published later this year by the Department for Business, Energy and Industrial Strategy (BEIS) – could help plug the policy vacuum.

A green paper for the strategy, released in January, proposed an “open door challenge” to industry to come up with proposals to “transform and upgrade their sector through sector deals”. It talks of improved productivity, competitiveness, employment skills and innovation – all areas where the resources sector has “a lot to offer”, says Hathaway at ESA.

Persuading BEIS to put something meaningful in the final strategy may be a tall order, but others see it as one of the most promising documents they’ve seen. Brexit is an opportunity to “make the industrial strategy tick”, says Read, and “open a very interesting can of worms”.

The idiom can be extended to the circular economy – a concept that can be harder to grasp in policy terms than, say, recycling targets. Defra officials are said to be continuing their negotiations on the EU’s Circular Economy Package “in good faith”.

But though Gove said he has “no intention of weakening the environmental protections that we have put in place while in the European Union”, he only mentioned the circular economy once in his speech.

As Jones pointed out in a blog published in June: in a soft Brexit scenario, it’s likely that the EU’s Circular Economy Package will become UK law; if there’s a hard Brexit, then the signals about the UK’s intentions are more mixed. Jones also noted the “encouraging words” coming from Westminster in relation to maintaining high environmental standards post-Brexit. Gove echoed many of these, but will they be a precursor for decisive action? “I am an environmentalist,” he said. It’s time to prove it.

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