Fifth Standing Committee
on Delegated Legislation
Thursday 11 November 2004
[Mr. Mike Hancock in the Chair]
Landfill (Maximum Landfill Amount) (Northern Ireland) Regulations 2004
2.30 pm
The Minister for the Environment and Agri-environment (Mr. Elliot Morley): I beg to move,
That the Committee has considered the Landfill (Maximum Landfill Amount) (Northern Ireland) Regulations 2004.
The Chairman: With this it will be convenient to consider the Landfill Allowances and Trading Scheme (England) Regulations 2004.
Mr. Morley: It is nice to see you in the Chair, Mr. Hancock, for what I hope will be an interesting and enlightening debate. Both sets of regulations follow on from the Landfill (Scheme Year and Maximum Landfill Amount) regulations that we debated in Committee in July. They are made under the Waste and Emissions Trading Act 2003 as part of our framework for improving our performance in sustainable waste management. The Act aims specifically to reduce or prevent, as far as possible, the negative effects of landfilling biodegradable municipal waste on the environment and human health by progressively reducing the amount of such waste that can be landfilled in order to meet our obligations under the landfill directive.
Parliament has already accepted the principle of a trading scheme as a means of meeting the reduction targets in the directive. It did that by agreeing to the Act. The landfill allowances and trading scheme regulations fill in the scheme details that follow from that. I realise that that may seem daunting to some authorities, particularly as this is a novel approach, but the fact remains that we have to reduce the amount of biodegradable municipal waste going to landfill, and the scheme provides authorities with much more flexibility in choosing when and how to meet their targets than obligatory annual reductions would. I hope that I can provide reassurance that that is the case.
Recognising the understandable concern and caution of some local authorities, we have made a tremendous effort to help authorities understand what is involved. That effort will continue up to the start of the scheme and beyond. We have sought to ensure that local authorities, directly or through their representative organisations, have been fully involved in all stages of the scheme's development. The Department for Environment, Food and Rural Affairs has held three consultations and engaged with stakeholders through two rounds of regional roadshows. That makes 14 events in total to explain the scheme. In addition a stakeholder group representing the views of local authorities meets regularly to discuss issues as they arise.
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Lady Hermon (North Down) (UUP): I am exceedingly grateful to the Minister for taking an intervention so early. Which roadshow came to Northern Ireland, and what consultation there has been with the district councils in Northern Ireland, particularly as the 26 district councils are under review and may be reduced to seven or eight?
Mr. Morley: There has been full consultation with the local authority groups in Northern Ireland and with Ministers who have responsibility for Northern Ireland. When I sum up, I will be able to give precise details of the roadshow.
It may help the Committee if I list some aspects that will have a bearing on how the scheme will operate. First, there are the flexibilities of the scheme—the banking, borrowing and transfer of allowances, which are aimed at giving waste disposal authorities choice in how they manage and deliver their targets. Secondly, responsibilities are placed on waste disposal authorities and landfill operators for the retention and submission of certain information. That is to ensure that we receive the most accurate and robust waste data for monitoring and reporting on our performance.
Thirdly, there is a system of penalties, which is designed to encourage authorities to achieve their targets under the scheme. Fourthly, there are provisions relating to the monitoring of the scheme and the maintenance of registers for recording allowances and other relevant information. The scheme in England, as in Northern Ireland, is designed to meet the landfill directive targets in the most cost-effective way. It is thought to be the first trading scheme in the world that involves the waste sector, and I am very enthusiastic about it. It has many potential benefits—for sustainability, for meeting our targets and for how local authorities operate.
Lady Hermon: I am most grateful to the Minister for giving way: he was looking in my direction, and that always invites an intervention. Having waxed lyrical about the benefits of the landfill scheme, will he explain why it is not being introduced in Northern Ireland until April 2005, given that that region in the United Kingdom is heavily dependent on landfill sites?
Mr. Morley: There are specific reasons for that, and I intend to touch on them in my opening statement, as they are relevant. However, it was reasonable for the hon. Lady to ask. The scheme has been designed to give local authorities greater choice and flexibility in reducing the amount of biodegradable landfill.
Miss Anne McIntosh (Vale of York) (Con): Will the Minister explain why the regulation is silent on the definition of biodegradable, as it goes to the heart of our debate? Which definition is being used, as it will have an impact?
Mr. Morley: Again, I would be happy to give the hon. Lady further details when replying to the debate. The definition used is based on the definition of municipal waste laid down in various EU directives. It is the waste for which local authorities have responsibility. It is fairly clear to them, but I shall expand on it when I sum up.
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The regulations will allow us to progress towards the step change required by the directive. A system of transferable allowances will enable the greatest amount of waste diversion to occur in areas where it is cheapest and most practicable. That will help overcome the fact that the diversion costs faced by each waste authority will differ according to circumstances.
Waste disposal authorities with low diversion costs will have an incentive to divert as much biodegradable municipal waste from landfill as possible, and they can sell their surplus allowances to authorities that face a higher cost of diversion. Conversely, waste disposal authorities with higher costs of diversion may prefer to meet their obligations under the scheme by buying allowances at a lower cost than it would cost to undertake the diversion themselves.
I am aware that a number of issues connected with the impact of the scheme and its operation are causing concern. Although we cannot address all local government's concerns or make fundamental changes, we are listening to those concerns and considering options for addressing them. Should that reveal the need for changes to be made to the regulations, we will do so.
Miss McIntosh: One implication is that a number of new facilities will be needed. Can the Minister give a figure? Between 2,000 and 3,000 new facilities will be required. Where will the local authorities find the money?
Mr. Morley: That point goes a little broader than the regulations, although it is related to them. I know that there are implications for considerable investment in treatment plant, but those are decisions for local authorities.
The environment and cultural services block grant has been increased by somewhere in the region of £1.2 billion, in recognition of the fact that the additional cost will fall on local authorities. Additional funds will be made available through private finance initiative credits—for example, to invest in major infrastructure for waste treatment and waste minimisation. Somewhere in the region of £200 million is also available from the waste minimisation fund. That will be reformed in due course, but considerable sums will still be available to help local authorities with such investment.
From travelling around the country and looking at rubbish tips and recycling facilities, which is part of my role, I know that a great deal of investment is taking place. I am pleased to see it. A lot of work is being done on the minimisation of waste, recycling of waste and diversion from landfill, which is all to the good. It will fit in very well with the new regulations.
We are going ahead with the regulations to provide clarity and certainty, both of which authorities have consistently pressed for. I know that some local authorities have some queries and concerns in relation to its operation, and we want to be sympathetic. In the first year we may well want to alter the regulations slightly to meet some local authorities' concerns as part of the transition. We do not rule that out. Those discussions are still taking
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place. For example, officials are working closely with other Departments and local authorities on the question of areas planning for population growth above the average. That is an issue that we need to discuss. A meeting will take place next week with representatives of Milton Keynes and Buckinghamshire. We must nevertheless avoid approaches that jeopardise the flexibilities provided by the scheme or undermine the certainty we are able to give authorities to enable them to make necessary planning and investment decisions. I am aware of some concern about the cost of the scheme on local authorities and, particularly, the implementation of a penalty system.
The scheme is not intended to inflict major costs on local authorities, either by imposing unnecessary penalties or forcing them to take part in trading against their will. In fact it will, as I have said, allow local authorities to share the burden of meeting the reduction targets. If trading schemes are to operate effectively, there needs to be a penalty system that provides a sufficient disincentive to disposal authorities to landfill more waste than the number of allowances they hold. If the scheme is used effectively, there is no reason why an authority should ever pay a penalty. If a local authority exceeds its allowances, it will be given the opportunity in the reconciliation period to trade or borrow allowances to balance the figures, thereby avoiding the imposition of a penalty. Moreover, if the reason why an authority has breached its allowances is largely beyond its control, the Secretary of State has the power under the Act to relieve it from any penalty for which it is liable.
As with any new scheme, there are likely to be teething problems and unforeseen operational issues, and we will keep all aspects of the scheme under review. A full operational review of the scheme is planned for 2007, which will consider how the scheme has gone in the first two years and whether any changes are necessary.
The landfill allowance trading scheme is an innovative measure that uses economic instruments to reduce dependence on landfill for the disposal of biodegradable municipal waste. I understand that a trading scheme is a new concept for local authorities and that its introduction is creating some anxiety. That is why my Department has been working closely with local authority officers to ensure that authorities are fully prepared for its introduction and are able to gain maximum benefit from the scheme.
I turn to the specific points made by the hon. Member for North Down (Lady Hermon). The Northern Ireland regulations specify the amount of biodegradable municipal waste that may be sent to landfills from Northern Ireland in the scheme years that will begin on 1 April 2010 and 1 April 2011. The reason is that considerable investment in a thermal treatment plant will not come on stream until a few years down the line. The regulations are being implemented on those dates to allow that facility to be available in Northern Ireland. That will help to meet targets on reduction of landfill.
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