landfill tax
DUTY OF SCARE!
Just when you thought it was safe to pick up that skip, along comes yet another change in the legislation which is badged as an additional effort to tackle waste crime. Yes, more red tape, which at first reading will not have much effect on illegal activities, which continue in spite of all current systems of licensing and registration. Fly tippers and operators involved in serious offences do not normally follow the paperwork trail that reputable operators are burdened with.
There is mounting evidence that the landfill tax is a contributing factor as our legislative drive to reduce waste going to landfill conflicts with its aims and objectives. Prohibiting waste from landfill is a sensible aim but we need somewhere for the segregated wastes that cannot be recycled, especially inert wastes and fines, to be deposited. This problem is significant for all waste operations and is regularly reported in the numerous journals, including The Skip. The ENDS Report May 2008 edition again noted several landfill avoidance prosecutions, such as depositing non-inert fines from a transfer operation to inert only exempt sites, fly tipping construction and demolition wastes and operating ‘exempt’ sites illegally.
One operation reported on the Environment Agency’s web site on 11 June 2008 was successfully prosecuted with the two defendants receiving custodial sentences of 14 and 22 months. The case is worth noting (http:www.environment-agency.gov.uk/news/2062931) as the defendants went to great lengths to appear legitimate, which has implications for carriers using such sites. How do you know the site you are using has a valid exemption? Traditionally, obtaining a copy of someone’s licence or exemption is sufficient proof that they have an approved operation. Not so anymore! Even if a site does have a licence or exemption the Agency are now chasing carriers that have legitimately used sites that have later been found to be non-compliant. How far should duty of care checks go? Should we be doing the Agency’s job for them? The simple answer is a resounding NO! Most waste operators are not qualified to audit waste sites and it is the job of the regulator that charges for the issue of permits and exemptions to do that job. Come on Defra, if you want to reduce so called environmental crime put some more resources into tackling it where it is most needed – i.e. on the ground.
The current system of using landfill or increasingly rare Paragraph 9 and 19 exemptions has to be addressed before any serious review of carrier registration or the duty of care takes place. The exemption review is well underway and I hope that Defra take on board the industry’s comments and also take a proportionate approach on inert landfill which would reduce the over reliance on exemptions that often stretch the boundaries of the legislation.
Now that rant is out of the way I shall concentrate on the title subject at hand. On 13 June 2008 Defra announced its second consultation on the controls on the handling, transfer and transport of waste, in the form of The Waste Controls (England and Wales) Regulations 2009 which if all goes according to plan will come into force in April 2009. The previous consultation closed on 6 march 2007 and the current one concentrates and consolidates the responses from the first one. The proposed regulations are the first major review of the Duty of Care and Carrier Registration since it came in to force over 16 years ago. Precisely what effect it will have on the legitimate waste industry is debatable as the main focus is on illegal operators, thereby increasing costs for the legitimate ones.
I shall concentrate on the effect on carriers this month and look at the duty of care in detail next month. The new regulations themselves are not very detailed and much will be left to guidance, which can be revised more easily than the legislation. The main proposals discussed are as follows:
1. Revoke existing regulations for carrier registration and the duty of care.
2. Impose a new duty for the Agency to make periodic inspections of all registered carriers of, and dealers and brokers in controlled waste.
3. Registration will be for one year rather than three, with various options proposed for renewal, such as a ‘tax disc’ based system which could be renewed easily and displayed on each vehicle. This will be an additional burden for larger waste operators with many vehicles or service companies with hundreds of vans but would enable carrier registrations to be checked instantly. The discs will be non-transferable i.e. new vehicle = new disc (at a cost of <£5 each).
4 Splitting carriers into lower and upper tiers, with the cost of registration for lower tier carriers (charities, farmers, waste producers etc.) at a one off £30 charge. Most waste carriers will face a £60 application fee and annual renewal of £45, which is not significantly greater but the process must be robust enough to ensure registrations do not accidentally lapse, which is addressed in the consultation document.
5. Waste producers may also have to register if they carry their own waste normally and regularly, although no detailed definitions of ‘normally and regularly’ have been proposed.
6. Change to revocation powers to enable more prosecutions to be taken into account when revoking a carrier’s registration. The increase in the list of prescribed offences could be done via guidance rather than legislation.
7. Proof of non-corporate carrier identity may be required i.e. copy of passport, driving licence, utility bill, bank statement etc. before a registration certificate or disc can be issued.
8. Possibility of new offence of failing to display proof of registration and issue of fixed penalty notices for more offences.
9. Raising the maximum level of fines for carrier offences to reflect the maximum for other offences (£50,000 in the magistrates court and unlimited in the Crown Court).
10. New proposals for seizure and disposal of vehicles.
In summary, the carrier registration changes will probably make the system more manageable for the industry as long as the Agency’s IT system can cope and enforcers take a proportionate approach to offences. Responses to the consultation should be sent by 8 September 2008 and I will be making a response on behalf of many colleagues in the industry, so if you have any comments to add please feel free to e-mail me or respond directly. The consultation can be viewed at: http://www.defra.gov.uk/corporate/consult/waste controls/index.htm.
Marco Muia BSc (Hons) MSc MCIWM is the Director of Oaktree Environmental Limited. He specialises in all aspects of waste planning and regulation consultancy. He also holds the level 4 COTCs for Hazardous Waste Treatment and Transfer. You can contact Marco on 01606 558833 if you have any questions about this article or e-mail him at enviroman@theskip.net
July 18, 2008 at 11:26 am | Environmental News | No comment
Tags: environment agency, Environmental News, landfill tax, Skip Hire Industry NewsTrackback URL for this post:
http://www.theskip.net/duty_of_scare.html/trackback
The unseen effects of landfill tax
Dear The Skip,
Not too long ago, Mr Darling and Mr Brown decided that they needed a lot more tax to help fill the hole of incompetence they find themselves in. So in their wisdom they decided to ambush the landfill tax with an escalator that has left many in the industry wondering what the hell happened. As one manager from a large national company said to me last year, “The £8 per tonne has caught us all out and it’s going to hurt”. Tough s***, I say, we’ve seen it coming for years and invested – that’s why 98% of all our waste comes through our MRF and that’s why they’ve been caught out. I must confess I find it difficult to sympathise with such comments when the big players’ press departments then come out with announcements such as “They welcome the tax hike and it will help their company”. What a load of bo****ks !
Mr Darling, on the other hand, can sit back safe in the knowledge that companies such as mine and yours will act as unpaid tax collectors, ensuring his money grubbing government will get every penny without even having to negotiate the rate. Likewise, the Landfill sites have no leverage and they’ve no alternative but to pass it on to the waste carriers. I should remind readers that, at this point, the government’s perception is that the landfill tax cascades down to the waste producers and the ‘polluter pay’ principle is achieved.
I’m afraid this is far from the truth, and let it be said that at this point things start to go very badly wrong. Waste collectors have to pass this tax on to their customers, but the finance act from which the landfill tax is spawned makes no provisions for waste carriers and as such it isn’t a tax we have to pass on, but rather an increased cost of working. Consequently, more and more waste producers are finding it fair game to screw their waste collection price down when the tax hike comes around each year.
Quite conveniently, the finance act doesn’t allow for any bad debt relief for waste carriers. So if the waste producer goes bust the waste carrier still has to pay the landfill tax to the site operator. And, just to add a twist of concern for the future, you may like to ponder the fact that the exposure on any bad debt that occurs is escalating each year as landfill tax rises. The effects aren’t just limited to bad debt, because even if you manage to pass on the tax to the waste producer without your prices being screwed down, the increased cost of working naturally increases your company’s turnover and most insurance companies calculate their premiums on T/O, so you will be paying higher insurance charges as the tax snowballs for the treasury.
The Governments tax take doesn’t stop there either, because the landfill tax – or rather your increased cost of working – attracts even more VAT and those increasing insurance premiums are subject to IPT (Insurance Premium Tax) so Mr Darling is on to a right winner!
Just this year alone, our company has responded to over 50 customers seeking a reduction in waste collection charges to offset the effects of the landfill tax. One wonders if sending the annual letter to customers warning them of this Mr Darling’s tax increase is a good idea. I’m sure we would have been better off just filling a skip full of £20 notes and setting them on fire!
Just to give you folks reading this some idea of how bad it is out there – all of our work is contracted with terms and conditions that allow for landfill tax increases, but this counts for nothing as waste producers take matters into their own hands. Indeed, as I write this wake up call, our company is dealing with a customer who, because of previous negotiations, hasn’t had an increase for two years and they are currently refusing point blank to accept any increases this year. Suffice to say, we have implemented our right to charge and they have cancelled the contract and are refusing to pay our invoices! To make matters worse, we are now burdened with legal costs as we take action to recover our premature termination losses and unpaid invoices which could take years to recover. The truth of the matter is, many in the waste management industry are the first in line to collect the tax for the government and we remain increasingly vulnerable. Waste carriers have become unpaid landfill tax collectors for H.M. Customs and the amounts we collect continue to grow significantly each year. This incurs more admin costs and the risks are becoming so great that, if a waste producer goes bust, the debt associated with the landfill tax could easily be 60% of your invoice total. And if you can’t stand the hit, you could find yourself in the hands of the receivers.
We recognised the impending problems 12 years ago and raised these very issues with the then Prime Minister, John Major, and the Treasury MP David Heathcoat-Amory. Suffice to say, the door was closed in my face and that’s the way it’s stayed ever since. Behind that door today sits Mr Darling. He needs to recognise these problems and provide our industry with some protection, similar to the bad debt relief afforded to landfill operators. Quite why the like of the ESA (The Environmental Services Association) have never addressed these matters is a mystery. I know for a fact that the Road Haulage Association waste group has raised concerns, so someone else is speaking out but what’s needed is a collective voice.
I’m sure many people involved in the waste management industry will relate to my concerns. I for one will be writing to my M.P. and the Chancellor expressing my unease. If you share my sentiments you will do the same.
Regards,
Peter Allen
Director, ISM Waste Recycling
THE SKIP SAYS: Thanks for your letter, Peter. Your frustration is no doubt echoed throughout the industry. It’s great to hear of people like yourself taking action rather than just accepting what is handed down. Is anyone else out there joining Peter in making a stand against this? Let us know.
June 17, 2008 at 9:27 pm | Readers' Letters | No comment
Tags: landfill tax, skip hire newsTrackback URL for this post:
http://www.theskip.net/the_unseen_effects_of_landfill.html/trackback
RETURN OF THE EA-PRIL FOOLS
Last month I wrote about the new Environmental Permitting (EP) regime which comes into force on 6 April 2008, the same day as Site Waste Management Plans and the new electronic submission system for planning applications via the Planning Portal. Let’s not forget good old landfill tax which will be £32.00 per tonne for active waste. So it’s all change, as we normally expect at this time of year, but what of the 2008/9 charging scheme? Yes, once again we are at the end of March and the Agency still hasn’t finalised the scheme, leaving applicants in limbo. Their motto ‘creating a better place’ obviously doesn’t extend to my least favourite website as there is no news of the charging scheme. So all we can do is take a look at the charges in the now closed consultation and compare them with the 2007/8 scheme:
Given that fixed permits will soon be the norm rather than the exception it is no surprise that the Agency has not proposed to reduce the fees according to the level of work involved. Over the last year or so we have heard about Agency budget cuts and staff reductions. Yet on 21 February this year an Agency press release welcomed a beneficial funding announcement and Dame Barbara Young stated “While the remainder of our budget allocation has also marginally increased, we face a number of large new duties, challenges and inflationary pressures which will need us to prioritise rigorously what we can best do to protect and enhance the environment.”
Compare the statement with the other news on their web site, which states: “Implementing a new integrated permitting regime in April – this streamlines more than 40 pieces of legislation into one regime which makes us quicker, more effective and simpler to do business with. This will include more online interactive services.”
Forgive me for prattling on again but doesn’t all that mean that there will be less work involved in issuing licences and exemptions rather than an increase in costs for that part of the waste sector. Once again the waste sector appears to be subsidising other activities. We can only guess what will happen when or if EP OPRA comes in for waste licensing in 2008/9 which will remain for 2009/10 for bespoke permits, with lower charges for fixed permits. Whether this will truly be the case is debatable as the Agency still has to source cash for its activities. Why not scrap licensing charges altogether and fund the function from the landfill tax rather than have the money disappear into the treasury.
Fans of Al Murray (aka The Pub Landlord) will be familiar with the sayings “Where would we be without rules… France” and “where would we be if there were too many rules… Germany”.
We could apply this train of thought to the UK; “Where would we be if we were the only ones enforcing European legislation… UK”.
So let’s hope that the permitting centre in Sheffield gets stuck in and issues licences and exemptions as quickly as we can prepare them. It can take less than an hour to prepare and submit an exemption renewal (if there are no changes) so why will it cost £426 from 6/4/06 for the Agency to do their bit and send a letter saying ‘it’s renewed’? Is the permitting centre staffed by expensive lawyers? Surely the actual costs of renewing and occasionally visiting exempt sites is not that high. Many exemptions we deal with don’t get a visit from the Agency, which I know can be a good thing depending on which region you are in.
So my wish from April 2007 is for effective permitting, consistency and transparency… who’s the April fool now? Envirofool doesn’t sound too good though. See you all next month with an analysis of how the new environmental permitting regime has taken off.
Marco Muia BSc (Hons) MSc MCIWM is the Director of Oaktree Environmental Limited. He specialises in all aspects of waste regulation consultancy and is a WAMITAB accredited assessor for the COTCs in waste transfer, treatment and inert landfill.
He also holds the level 4 COTCs for Hazardous Waste Treatment and Transfer. You can contact Marco on 01606 558833 if you have any questions about this article or e-mail him at enviroman@theskip.net
April 19, 2008 at 6:13 pm | Environmental News | No comment
Tags: Environmental News, Environmental Permitting, landfill tax, skip hire, SWMP, waste managementTrackback URL for this post:
http://www.theskip.net/return_of_the_ea_pril_fools.html/trackback
MORE FLY-TIPPING, DARLING?
THE BIGGEST EVER RISE IN LANDFILL TAX: WHAT DOES IT MEAN FOR THE SKIP HIRE INDUSTRY?
The announcement on 12th March by the Chancellor of the Exchequer, Alistair Darling, that the landfill tax will increase from £24/tonne to £32/tonne has sent ripples of concern through the waste industry. There has also been a very positive response from many of the top-tier waste management companies who view it as a positive step towards recycling and environmental protection.
Furthermore, Mr Darling announced his intention to increase the tax by a further £8 every year to 2009/2010 where it will stand at £48/tonne. The price of inert is set to increase from £2/tonne to £2.50 and will be capped at this rate until 2010.
The initial concern to most of the skip hire and small waste management companies in the UK is how it will this affect their business. Worries that the inevitable price increases in skip hire will prohibit many domestic customers from disposing of their waste in a responsible manner are preoccupying many people in the skip hire industry. It is hard not to suspect that every time the Chancellor increases landfill tax, we witness a correlative increase in fly-tipping, particularly in the inner cities.
DOUBLE-EDGED SWORD
Steve Cunningham, of CCS Skips in Manchester, says: “It’s a double-edged sword. Nobody would complain at the government’s initiative to reduce landfill but this move is going to encourage fly-yipping for sure. It’s no longer enough to say that increasing prices will inevitably increase recycling rates. Is it not obvious that we are recycling as much as we possibly can? Landfill rates at £24 a tonne are prohibitive enough. This is going to squeeze my profit margins even more”.
Jane Pullen, from Libra Skip Hire in Surrey, is outraged: “As far as I can see, this is a tax on tax! We are forced to increase our prices and the government rakes it in in increased VAT. How are we going to benefit? It’s not as if the government will reinvest this revenue into recycling initiatives. Also this is going to have a knock-on effect on the building trade as it will inevitably increase the on-site costs.”
Another prominent skip hire company owner told The Skip: “It’s not easy trying to tell customers that our prices have to rise by over 20% overnight – how many other industries could cope with such a hike? If they really want to push a green agenda, this is not the way to do it. Our domestic customers are going to laugh down the phone when we tell them how much a skip costs now!”
BIG BOYS HAPPY
The landfill operators themselves will see a reduction in tipping which is, of course, the primary function of the tax. The other view from the large corporate waste management companies are welcoming the tax as an encouragement to further recycling. Steve Lee, chief executive at the Chartered Institution of Wastes Management, said: “Raising the tax by £8 per tonne per year to £48 by 2010 for ‘active’ waste will make a whole range of waste treatment technologies financially viable – for all wastes, not just municipal. The three-year plan for the escalator is good, too. Businesses need time to change and even the anticipation of a £48 per tonne tax – plus steadily increasing landfill gate fees – will be enough to influence many waste and resource management decisions.” True, if you are able to invest heavily in all the machinery crucial to increasing recycling rates in the first place. Mr Lee also acknowledges that the downside to the tax increase will be an increase in fly-tipping and other illegal waste management activities.
PANIC
Panic price increasing has already been seen amongst the smaller waste management operatives. Skip companies across the UK have been putting their prices up by as much as £40 per skip in many areas. London has even seen increases of £60 on an 8-yard skip. There can be no uniformity here as each individual company’s prices now depend solely on their individual recycling rates and how much they can avoid sending to landfill. But with these hefty increases, will skip hire become no longer affordable to the consumer? The short answer to this is “possibly”.
The consumer has three choices: pay the premium, seek out ways of recycling the waste themself or fly-tip. It is easy to guess which choice the scrupulous person would make, and which the unscrupulous. It is a safe bet to assume that paying the premium will not be the most attractive option.
Fears of downturns in business and increased illegal activity would be allayed if at the same time as assuring us of further tax increase, Darling could promise a greater spend on fighting waste crime.
Richard Skehens, of Grundon Waste Management, says “More of the increase should be regularly put back into the Landfill Community Fund (LCF) and some of the money should be ring-fenced and passed to the Environment Agency (EA) to assist them in dealing with environmental crime.”
This view was echoed by Jean Dominique Mallet, Veolia Environmental Services’ UK CEO, who said: “We support the government in diverting more funding than it does at present from landfill tax into fighting waste crime.” Skehens went on to say: “The upside of this approach is that it would help to push waste into licensed sites – where it will generate more tax – which could eventually make the EA’s environmental crime unit self financing.”
Let us know your views. Email pr@theskip.net
LANDFILL TAX – THE LOWDOWN
What is landfill tax?
An environmental tax levied on landfill operators which is passed on to its customers and therefore on to any waste producer. Intended to encourage recycling and reflect the non-monetary cost of landfill, such as environmental impact and leachate into water supplies.
What are the rates of tax?
Currently £24/tonne for active waste set to rise to £32/tonne on 1st April 2008, to £40/tonne on 1st April 2009 and to £48/tonne on 1st April 2010. For inert waste (rocks and soils, ceramics and concrete, unused minerals, furnace slags, ash and low-activity inorganic compounds and water) the tax is currently £2/tonne set to rise to £2.50 on 1st April 2008 and capped at this rate until 2010.
What materials are exempt from landfill tax?
Dredgings, any disposal from mines or quarries and any waste from contaminated land clearance (although the Chancellor is currently looking at abolishing this last exemption and subjecting it to the same rates of tax as active waste).
Is it effective?
From 1997 to 2003, landfill fell from 96 million tonnes a year to 80 million tonnes. In 2007, the tax brought in £0.8 billion in revenue. This is set to increase to £0.9 billion in 2008. In the two years following the introduction of the tax, household waste managed by local authorities grew by an unprecedented 5%. It is widely suspected that commercial enterprises are using household waste disposal illegally as a channel for free disposal of waste to avoid the increased disposal rates. It is widely suspected that increased fly-tipping and illegal waste disposal sites are a product of the tax and that the EA has not received sufficient funding to keep on top of the increase.
April 4, 2008 at 5:02 pm | Skip Hire Industry News | No comment
Tags: landfill tax, skip hire, waste industryTrackback URL for this post:
http://www.theskip.net/more_fly_tipping_darling.html/trackback
Feel free to join the discussion by leaving comments, and stay updated by subscribing to the RSS feed:
- Home
- Email Newsletter - SIGN UP HERE!
- Skip Hire News
- Environmental News
- Health & Safety News
- Advertiser Information
- Subscribe HERE
- Skip Hire Products/Services
- Back Issues
- Skip Hire TV
- Skip Chicks
- Skip Hunks
- Local Skip Hire UK
- What Our Advertisers Think
- What Our Readers Think
- Contact Us
- Link to Us
- Link Partners
- Links
- Sitemap
Latest Posts
- “The Skip” Issue 59 June 2010
- “The SKIP” Issue 57 April 2010
- “The SKIP” Issue 56 March 2010
- The Men Who Stare at Regulations.
- Dear Bernice – The Skip Industry’s Agony Aunt
Search Posts
Archives
