MS TRICIA HENTON, MS LIZ PARKES AND MR MALCOLM FERGUSSON

18 DECEMBER 2008

  Q120  Lord Bhattacharyya: One of the things that I would look at is the Health and Safety Executive. It is pretty well-structured and you know what to do and what not to do. How does that work under your agency? It is a completely different agency and you are the Environment Agency. Do you work together and come out with regulations or come out with provisions?

  Ms Henton: Our work with the Health and Safety Executive?

  Q121  Lord Bhattacharyya: Yes.

  Ms Henton: We work very closely with them partly because they are a fellow regulator. We regulate some of the things jointly, the Control of Major Accident Hazards legislation is joint work, and we work very closely with the Nuclear Installations Inspectorate, which is part of the HSE, on the regulation of nuclear power stations and other nuclear processes, so as a fellow regulator we have a lot to do with them.

  Mr Fergusson: The motor industry which you mentioned is a good example of where a fundamental change is required and where, as you say, historically motor manufacturers have not seen it as part of their business to worry about the disposal of their vehicles, but the End of Life Vehicles Directive is beginning to change that and, on the back of that as experiences come through of what the problems are in recycling these things, then this is fed back into new regulations on the actual components, on things such as labelling them or banning certain hazardous products or things that are hard to recycle. That is an example of where there is a feedback through again at a European level because it does not make much sense to think of the motor industry at the national level, well, obviously it is international, but it is quite strongly a European-level thing, so that is an example of where the Commission has made quite a lot of proposals which are beginning to feed into the design process. That is almost a psychological thing where manufacturers, and this is across the board, have to begin to think of their products not just as something "I make, sell and forget about", but where there is this responsibility to think about the whole life cycle. It is not an easy thing, I know.

  Q122  Lord Bhattacharyya: But very seldom do they design without thinking. With a new strategy for product design, they would have to think about what happens at the end of life. Therefore, the whole business of life-cycle costing has to take into account what happens in the end and, hence, the cost also goes up, so they are quite aware of that, but how can you and your organisation help?

  Ms Parkes: Coming back to the Environment Agency, we are principally here to regulate the pollution which would otherwise be caused by industrial processes. We are not charged with looking at products across the board and we do not claim to have that broad competency or the resources to tackle that, and that is why it is so important that the Government's sustainable consumption and reduction agenda looks at this in totality and is very clear about who should be discharging that function.

  Q123  Lord Howie of Troon: I wonder if you are happy working with the Health and Safety Executive. It sometimes appears to be a sort of loose cannon as well as being a loose battery.

  Ms Henton: Well, the Health and Safety Executive is obviously one of the major regulators and indeed just recently the Better Regulation Executive has been carrying out an audit of the five big regulators, ourselves, health and safety, food standards, financial services and competition, and I cannot remember the fifth, with a view to ensuring that the methods that we are using for regulation are indeed compliant with the principles of the Hampton Report. We work very closely with Health & Safety and they are a large, effective regulator of their particular remit which in some ways, as I have said, very slightly overlaps with our remit.

  Q124  Lord Lewis of Newnham: I think you have emphasised a point that worries me tremendously. As you rightly say, you are there to implement regulation which has been established and you rightly point out that HSE can actually initiate regulation in some way or another. Now, it strikes me that here you have a certain problem between who actually makes the regulation and who actually applies the regulation, and this really reverts back to a point that occurred with a previous committee, of which I think the Earl of Selborne was the Chairman, where we were very concerned with the fact that the Environment Agency was responsible for implementing legislation that came from the European Union, but very often had very little, if any, concern with actually formulating the regulation in the initial stages. We were assured that there was going to be some form of concordat between the two of them to alleviate this particular problem. I would like to know how far that has actually worked out because it strikes me as basic. If all, in point of fact, you can do, with no disrespect, is actually deal with the problem that is there, so, for instance, the problem that Lord Bhattacharyya has been posing to you is one that is beyond you, it seems to me that it is the people at the coalface who should be really making these sorts of decisions and I worry that Defra is one stage away in a rather esoteric atmosphere so that it can actually formulate these rules without necessarily knowing how easy they are to apply, how applicable they are even in any sense whatsoever and, thirdly, whether they are really the things that should be being regulated at this particular moment in time because, once it comes out of the European Union, then it is there.

  Ms Henton: I think in the general point of how the Environment Agency works with its sponsor department and in our role as a statutory adviser to Defra, we actually do have a very good and clear working relationship on advising on legislation, on assisting Defra in its negotiations within Europe and, for example—

  Q125  Lord Lewis of Newnham: You actually go to Europe with Defra?

  Ms Henton: We go to Europe with Defra. For example, on the recent Groundwater Directive, one of my staff was there on Defra's behalf, because we are acting with Defra on this, in some of the detailed negotiations going on in Brussels, and that happens across quite a wide range of different bits of legislation. To get over the point that you make, what we want is a clear line of sight from the UK's influence on European legislation, as much as it is possible to do, and then being clear with what comes to the UK that we can actually implement it, and we advise and assist Defra in drafting the domestic legislation to take that into action, so we have a very close working relationship with them on that and it is a successful one.

  Ms Parkes: We have a formal memorandum of understanding between ourselves and Defra and, whereas in the past we may have been valued for our technical expertise, increasingly we are valued for our practical experience of implementation as to what actually will work. As my colleague said, it is about top-to-bottom policy-making so that Defra and BERR are just as interested in practical implementation, working with industry and saying, "Will it actually achieve the outcomes that we have set out?" One of the challenges is though that environmental legislation needs not just to tackle issues end of pipe, but it needs to look upstream and the question there is about having to brigade a number of different delivery bodies because clearly we are not charged with doing all the good things that need to be done in the name of the environment, but we have a statutory role which we need to fulfil and we need to focus our efforts on those activities.

  Q126  Lord Bhattacharyya: Most businesses will get very confused if you are going there with some advice and Health & Safety are going with some of their advice. Unless there is a single method of advising businesses on the whole business of waste and the environment, it becomes very confusing. If you take a small company where they are doing electroplating, of course there are big issues there, but they will get so confused with multiple bodies.

  Ms Parkes: If I can help on that, we have very-well-established website which is specifically set up to give advice to small businesses. It is UK-wide and we work with our partner regulators and it is about giving advice that is tailored at specific sectors of all environmental legislation, not just waste legislation. That receives a huge amount of hits and people find that absolutely invaluable which helps people to cut through and find out what it is that they really need to know.

  Mr Fergusson: A further point I would like to add is that there is a very effective pan-European network of regulators who work together, and the EA is of course a very active member of that and we work quite a lot with it on European legislation. I have colleagues sitting behind me who will know better than I do about this, but in most respects, I think, it is able to engage fairly effectively with the Commission and there is a good feedback into the detailed design of legislation from the experiences of legislators at the European level. It does not always work, but it exists and it is quite an effective network.

  Q127  Lord Crickhowell: Can I say how pleased I am that progress has clearly been made since the old NRA days in getting the act together with the departments in Brussels and in Europe and that we are making the effort. It had not quite got there in those days, so it is good news. The emphasis that you have been putting very understandably has been on the European role here and the pan-European network, but we have got on to WEEE, the Waste Electrical and Electronic Equipment Directive. We have received evidence from HP saying that the crucial factor in doing all that was that it really had producer responsibility and they point out that in quite a large number of European countries the responsibility has not been translated into national legislation, national law, in the way that makes producer responsibility the centrepiece; it has been a joint responsibility. They say that it is really a serious threat to the whole Directive because quite clearly, if the thing is going to work, it has got to work right across Europe. In your discussions both in Brussels and indeed with the pan-European network, are you seeing problems like that emerging and is there an effort, particularly with these newly joined countries which perhaps have not got their act together, to make sure that the thing is working in a universally applicable way right across Europe?

  Mr Fergusson: Well, I think it is early days, particularly with, as you mentioned, the new Member States. I should add that we have done more work on the End of Life Vehicles Directive than WEEE, but some similar comments have been made in both. Certainly for the new Member States, they have come very late to this and they have not long had these responsibilities put upon them and I think it is fair to say that it is early days and that things have not emerged in a uniform way. Even with the existing Member States, still the Commission is only at an early stage in assessing what Member States are doing and how effective that has been. There is absolutely no doubt that there are significant differences in the way Member States have implemented some of this legislation which, as I said earlier, reflects largely the fact that they begin from different systems of waste management and responsibilities which could, for example, be with local authorities or some separate agency and so on, so it is almost inevitable that there are these differences. The key question will be whether, and to what extent, individual companies end up being made responsible. It is generally not all that efficient for individual companies to be expected to make their own arrangements, especially in pan-European markets, for example, it would not make any sense shipping all the scrapped Volkswagens back to Germany to be recycled, so almost inevitably some sort of, I think, pooling arrangement with third-party agencies actually doing the work of dismantling, recycling and so on is an almost inevitable part of the system, but the key issue will be to what extent companies are actually in the end made responsible. Certainly with the motor industry, I think, by and large, they have been. There are problems as yet with the system, but I think there is not much doubt that the individual manufacturers are, by and large, being held responsible, though I am not fully aware of the issues that HP has raised with you, however.

  Q128  Lord Crickhowell: It is not just the newer countries. In their evidence, they include the UK as having omitted the requirements of Article 8.2 in transposing the WEEE Directive into the national law and, instead of legislation in these countries, it makes producers jointly responsible for the recycling of future products, making it impossible to implement individual producer responsibility, so, according to HP, it is not even working as it should be in this country. Would you agree with that?

  Mr Fergusson: I cannot comment in detail on that myself.

  Ms Parkes: In relation to the ELV Directive, as my colleague said, there is an element of individual producer responsibility in that Ford, for instance, do have to take back their own products that get taken back to their own sites. When we come to look at something like WEEE, it is, I would say, impracticable to think about individual producer responsibility because one would need to identify the source of every item of WEEE and that is clearly not feasible for such a vast number of small items that are coming in from all over the world. Actually, the only way in which we think producer responsibility can be made effective is through the collective system and the question then is how far does one get to actually challenging product design through collective producer responsibility and, when one is looking at product policy, it has to be looked at on a European, if not an international, footing.

Lord Lewis of Newnham: But is this not one of the problems really? With no disrespect, I think the vehicle side is the easy question compared with WEEE, and I am totally in agreement with you on that, but one of the incentives for the whole concept was in fact that it would encourage the producer to involve themselves with recycling possibilities so that they would modify their particular piece, a television set or something of this nature, to minimise the problems involved in recycling, whereas at the moment of course that incentive has been removed because of course there is not a basic overall responsibility, but it is now involved with a large number of firms. Now, this is compounded by the fact, a point I think you referred to earlier, that in many instances one is dealing here with multinationals which are not associated with one individual country and, if there are different regulations within Europe and, goodness gracious me, many of these things are not restricted even to Europe, it does strike me as providing a very difficult situation which really has got to be addressed. There are big parts of WEEE, and I do agree that the small ones are going to be difficult to deal with, but the big ones should in principle, in my mind, be dealt with. Then, of course there is the whole problem of the orphan situation.

Chairman: That is as much a statement as a question!

  Q129  Baroness Sharp of Guildford: To some extent, keeping on the same subject, the Integrated Pollution Prevention Control Directive places a statutory duty on industry to reduce waste. Which sectors of industry are covered by the Directive and how is compliance assessed and enforced? Do all companies have to meet the same standards or are there special requirements, for example, for small companies?

  Ms Henton: Well, there is quite a wide range of industries that are covered by IPPC, the energy industry, the production and processing of metals, the mineral industry, chemicals, waste management, and then there is a category called "other activities" which actually again covers quite a wide range of things, like pulp and paper, carbon, black tar and bitumen, printing, textiles, timber, animal waste and intensive farming, the pig and poultry sector which is the very last one just being brought in. To give you an indication of the scale of what that means, we have just under 4,000 permits in the UK which have been issued and indeed 30 October was the final date for the implementation of this Directive. We are very pleased that within the UK we have managed to reach that objective and there are about 100 difficult obstacles outstanding, so this is quite an achievement. In terms of how we deal with waste reduction within IPPC, we impose conditions within the permit that require the operators to take measures that will ensure that waste is avoided or is reduced or, where it is reduced, they either recover it wherever practicable or that they dispose of it in a manner that minimises its impact on the environment. Then, as part of our regulation of IPPC, we require them to review every four years or so the changes that have taken place in these measures, whether they are actually reducing the amount of waste that they generate and the amount of resource that they use. That is the prime way that we review this. Another way, the second route, is that we have developed with some of these sectors what we call "sector plans" and these are sort of voluntary arrangements with the specific sectors, for example, the chemical sector, the nuclear sector, the cement manufacturing sector, whereby we are looking in partnership with them at where their environmental performance should move in the future, so it is going a bit beyond regulation, but how do they want to take full ownership and responsibility for their environmental impacts and actually do something about it. The development of these sector plans is very much welcomed by the different sectors and it is a way in which we can help advise and influence them to get their own thinking right and to take responsibility for improving their environmental performance.

  Q130  Baroness Sharp of Guildford: You set, I think, industry a target of 15 per cent reduction of waste disposal between 2006 and 2011. To date, can you tell whether there has been progress made on these targets?

  Ms Parkes: It is early days obviously because that is a target for 2011, but generally about half of all the waste from those industries is being recovered in any event and that is about the work we have done with them over recent years, so it is about going through perhaps some of the more challenging aspects of those waste streams now.

  Q131  Baroness Sharp of Guildford: Are you monitoring all these 4,000 permits?

  Ms Parkes: Absolutely. They get inspections by us and many of them also have their own environmental management systems which means that they are audited by a third party and then we will again look at the evidence of that, so we focus our efforts on those that are performing least well and those that actually stay outside regulation.

  Q132  Baroness Platt of Writtle: We have heard that, following the implementation of producer responsibility obligations for packaging waste, recycling has increased, but there has been no reduction in the amount of packaging used or discarded. What is the explanation for this, and how could producer responsibility schemes be improved to encourage waste reduction?

  Ms Parkes: These Directives are predominantly about encouraging recycling, so that is the first thing to note. Most of them have elements about minimising production and looking at the design, so, for instance, there is also something called the Restriction of Hazardous Substances Directive that has been implemented alongside the WEEE Directive which is actually looking at the components. In terms of what it is achieving in reduction of packaging overall, it is true that we do not believe it is having as much impact there as it perhaps could do, but again that is a challenge looking at changing behaviours and looking at what is actually put on to the marketplace. The other aspect, because there are two aspects to the Regulations and we implement the producer responsibility requirements, but there is a separate set of Regulations, the Essential Requirements Regulations, and those really are looking at product design. Those are enforced by local authority trading standards and it is fair to say that there have been problems with enforcing those Regulations. Trading standards obviously have a wide range of roles to play, but it is predominantly about protecting consumer safety and making sure that the consumer is not short-changed rather than necessarily environmental outcomes, so it has been an extra obligation for those local authorities to enforce, but we do believe they have had practical difficulties. The Directive itself, not just the Regulations, contains a set of statutory defences, so, if the manufacturer thinks that what they are doing is in the best interests of the consumer and they can evidence that by the fact that their products are selling, then that gives a statutory defence to the accusation that they have over-packaged, so you can appreciate that that is quite an easy one maybe to walk away from. In fact, the half a dozen offences that have been prosecuted under these Regulations, we think, probably could have been achieved under other trading standards legislation, so there is a real question mark that we have been discussing with the Government about what more needs to be done to revisit the essential requirements, and in fact I believe the Minister has written to the Commission to say that this needs to be looked at not just domestically, but on a European-wide basis to say that this needs to be made to work more meaningfully.

  Mr Fergusson: Obviously it is a bit of nonsense to try and tackle that at the local level through trading standards officers, I would say. The other point I wanted to make though is that just because that particular requirement has not resulted in reduced packaging waste does not mean it is not valuable in its own right because it certainly is. The point is that an added focus on reducing at source is needed to go alongside that target.

  Q133  Baroness Platt of Writtle: What support has there been to help businesses comply with packaging producer responsibility obligations and has this support been tailored for companies of different sizes to avoid unnecessary burdens?

  Ms Parkes: All the work we do around implementing producer responsibility is done in partnership with industry, and we have particular regard to small businesses, making use of, as I said, the website which I mentioned earlier, but we also have, for instance, a national customer contact centre and that is our front line dealing with any member of the public, industry or commerce that wants advice. We do make sure with any new legislation that we work very hard to reduce the burden and make sure we focus on the what are the real environmental outcomes, so the good news is that we are generally meeting our packaging targets, and that is good news, and we do not believe that it is at a huge cost to industry by comparison with maybe some other Member States.

  Q134  Baroness Platt of Writtle: In your evidence, you say, "We don't have the remit or technical expertise to comment in any detail". It seems to me that, in the new and environmentally changing situation, you need more technical expertise. Are you going to get it?

  Ms Parkes: I think that was in relation to our role around the whole material and product area which we talked about earlier. We are confident that we have the expertise we need to discharge our key role as an environmental regulator and as an adviser to government, but we also have a crucial role in supporting local government in trying to make sure there is an adequate network of waste management facilities because, if we have not got the infrastructure, then we cannot do the recycling here at home. We do not profess to be the body that is there to give advice to industry on all aspects of products policy.

  Q135  Baroness Platt of Writtle: All through what we have been asking today has been this need for innovation to go from both ends and surely that does need technical expertise.

  Ms Parkes: Absolutely, and we think that is the role which, between BERR and Defra, they have. They have set up the Market Transformation Programme and that is the body that is looking at things like energy efficiency, labelling and appliances, and we have also referred to the new Material and Products Unit, so this is about what our role is as an environmental regulator, and we are dealing with those.

  Q136  Baroness Platt of Writtle: Do you work closely with whoever you speak for?

  Ms Parkes: Absolutely, and through the Waste Strategy Board we are looking for greater clarity about priorities and to try and make sure that people are clear and that business, in particular, has a clear way of going to for advice, but we have a particular job to do that we are charged with doing which is perhaps at the less attractive end of environmental regulation which is about dealing with the polluters, and it is important that that is where we focus our resources.

  Q137  Chairman: My former constituency was engaged in producing bottles for the Scotch whisky industry, a very laudable activity, but what was quite clear was that the more expensive the Scotch, the more expensive the packaging, and it is the same for perfumes and things like that. I find it difficult to know how you can actually intervene in a process where you know that, if you package it in a very attractive, but usually expensive and wasteful, manner, you can sell something for an awful lot more than you would otherwise be able to do. As a consequence, you are very often creating waste and actually spending money on the production and sale of glass bottles and really you could have a bog-standard bottle and everything could go into it. Does this concern you? This is obviously a BERR responsibility rather than yours, but you at the end of the day have to clear it up.

  Ms Henton: I think this goes to the absolute heart of this whole discussion. We deal with waste, but we operate within a whole climate that is global, industry is global, and we are working in a world that is about consumption and it is not necessarily about sustainable consumption, but it is about consumption, it is about marketing, it is about getting people to consume more, to use more stuff. We are coming up to Christmas now and you look at the amount of product, wrapping and packaging, et cetera, that is being used, it is because that is the way that society operates nowadays. If we are going to make real progress on the whole sustainable consumption and production agenda, we are into an enormous issue of changing public behaviour, changing the way that society operates and it is in a global context as well, it is not just a UK issue, so it is an immensely difficult thing to actually get a grip on. We play our part as best we can, government plays its part and we need leadership from government in dealing with this issue, but I think we have to recognise the reality of where we sit in the whole global marketplace.

  Q138  Lord Bhattacharyya: But is that not what happens in all of these sectors? You cannot actually intervene in the market. I will produce something which is competitive and, if you come and say to me that my process is old, it is polluting or that my process is wasteful, as long as I can make money, as long as I am competitive, in other words, I will go on and do it, so why should you intervene?

  Mr Fergusson: Again, there is a big question of EU context because, although it is increasingly difficult even at the national level to intervene, the European market is a very large market which is a regulated market, so it can be effective to intervene at that level, to impose requirements at that level, as we have already seen in a couple of things that we have been talking about today. Personally, and it will figure in later questions somewhat, although the global dimension is no doubt important, I think in practical terms it is probably going to be a lot more effective to focus on putting our house in order at the European scale and not wait for some international process to sort these things out because it is often the experience that actually a regional-level initiative from Europe, for example, will pre-figure a more global framework which might follow on from it, but it is genuinely quite difficult to wait for it to happen the other way round.

  Ms Henton: I certainly would not want to give the impression that there are not things that could be done, there are of course, and you can see already because of the way that the whole sustainable development agenda has been reinvigorated over the last year or so, which has been incredibly encouraging, that there are organisations and companies which are now taking up this challenge. They recognise that we cannot go on using the world's resources in the way that we have done, we have to do something about it and they have a role in it. We have our role in advising, assisting and as a delivery body in the hard end of that. I certainly would not want to preach that it is impossible to do something, but I think we all have to recognise it is a long uphill struggle.

  Q139  Lord Lewis of Newham: May I say, you seem to be involving the stick rather than the carrot.

  Ms Parkes: In our role as a regulator we are charged with tackling pollution when it is caused and trying to prevent that pollution, we are not charged with looking at the whole life cycle and intervening right upstream, that would be very difficult to do for a domestic regulator. As Tricia has said, there are a whole range of activities that need to be taken—let us not forget the role of consumer behaviour in here—and there has been recent research that shows one-third of all the food we buy goes to our fridge and then goes straight into the bin. There is a very similar figure for material going onto construction sites that has been overspecified, oversupplied, damaged that, again, goes straight off to landfill. What is it about our behaviour as consumers, business and industry that is leading us to be so wasteful in the purchase? That is not about manufacturing, that is just about poor practice and this is where, again, we are very proud of the work we have done around the whole area of public procurement, leading by example, not just in using recycled office paper, post-consumer waste, but actually making sure that when we purchase, whether it is new paper, engineering works, sheet piling or steel, all of that, that we source material wherever possible which has come from a secondary supply, that we understand what the environmental consequences are around the whole of our IT procurement. We all have responsibilities as public bodies to go even further on that to bring about drastic change.