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Producer Responsibility Obligations (Packaging Waste) (Amendment No. 2) Regulations 2008

Volume 703: debated on Tuesday 8 July 2008

rose to move, That the Grand Committee do report to the House that it has considered the Producer Responsibility Obligations (Packaging Waste) (Amendment No. 2) Regulations 2008.

The noble Lord said: We meet today to debate a proposed technical change to the UK’s packaging regulations. I assure noble Lords that I have checked this. It is not an underhand fiddle; it is a purely technical change to the regulations. The regulations remove an administrative burden from exporters of metal packaging waste intended for recycling overseas. After the packaging regulations came into force in 1997, the UK's packaging waste recovery rate rose from 30 per cent to around 63 per cent by the end of 2007. This is an excellent achievement by all sectors involved in the packaging chain, and all parts of the industry deserve congratulations.

Alongside the overall directive target of 60 per cent for recovery and recycling, the UK also has to meet a 50 per cent recycling target specifically for metals. The amendment will ensure that we are able to count eligible packaging waste towards the achievement of the packaging directive targets for recovery and recycling. I emphasise that it does not reduce the level of environmental protection contained in the Transfrontier Shipment of Waste Regulations.

Metal smelting is a relatively clean process, and market intelligence suggests that most of the metal exports are reprocessed at the top of the range of industrial plants. These are often owned by major multinational companies. The environmental benefits of recycling metals are beyond doubt. As scrap metals have a high intrinsic value, there is little or no risk that shipments would get dumped. We are confident that the metals are going to the right places and are being handled in broadly equivalent conditions in modern facilities, but exporters cannot always obtain the evidence to show that this is the case. This places the achievement of the packaging directive’s recycling target for metal at risk, as we cannot meet it without export. The amendment that we are proposing to the packaging regulations would ease this problem. It gives the Environment Agency more discretion in assessing what sound evidence of “broadly equivalent” would mean.

The original regulations seemed to be accepted by the industry without complaint. This measure may appear to be an example of typical Defra gold-plating, but it is proposed with the best of intentions. The industry was relaxed about the original regulations and believed that it could cope with them. However, since their introduction, complaints have arisen with regard to metal. Therefore, we need to make this technical adjustment. As I say, it meets all the environmental aspects and targets. The Environment Agency is in charge of this matter, but the amendment gives it more discretion. I commend the regulations to the Committee. I beg to move.

Moved, That the Grand Committee do report to the House that it has considered the Producer Responsibility Obligations (Packaging Waste) (Amendment No. 2) Regulations 2008. 23rd report from the Joint Committee on Statutory Instruments.—(Lord Rooker.)

I declare an interest as my family horticultural and agricultural business is an obligated producer under these regulations. I am also co-chairman of the Associate Parliamentary Sustainable Resource Group. I hope that this gives me an insight into how these regulations will work. Although no one in business welcomes the administration and cost that they will entail, the greater purpose of resource conservation—that is, waste recovery and recycling—is well served by the system. However, the imposition of detailed record-keeping imposes a great cost on business and we should be mindful of this in how we implement these regulations.

To what extent does the Minister think that the 2007 regulations have been successful in reducing the overall amount of waste? The new regulations continue the process of seeking to increase recycling rates. The business targets are higher than the target set under the EU directive to allow for the substantial number of small businesses excluded from the obligations. Do similar arrangements operate elsewhere in the EU? Will the business targets set meet the EU targets in a direct comparison?

However, as the Minister said, the principal purpose of the new regulations appears to be the need to tackle the slippage which occurs through the export of metals. It is surprising that aluminium recycling is at a remarkably low level at around 30 per cent. The PERN, which forms part of the waste export industry’s vocabulary, has to compete with the very high value of metals themselves and the difficulty of getting sound evidence that the recycling meets the criteria. To the extent that the regulations recognise that difficulty and seek to find a more flexible method of providing sound evidence through the discretion available to the Environment Agency, we understand their purpose.

However, we remain concerned about them. I hope that the Minister will indicate what guidelines might be followed. We cannot be relaxed about the way in which less valuable recovered products might be dumped in landfill or even at sea. The news of police raids today shows that there is cause for concern that criminal gangs may have infiltrated the genuine waste recycling industry, and local authorities are losing the battle against the theft of road signs and street furniture. If it can be lifted, it is a potential target for thieves.

The Government may believe that the regulations will be used mainly for high-value metals. I understand that thinking, although I am less sure of how it can be achieved. It could extend the possibility of disreputable activity here and abroad as we export our waste responsibilities. Indeed, it could be an open invitation to cheats and rogues. I look for the Minister’s reassurance in this regard.

I certainly welcome the Minister’s confirmation of the increased percentage of recycling, rising from 30 to 63 per cent, which marks an important improvement over quite a long period, but still leaves room to make further progress. It shows how bad we were at recycling in the past, and how much we are mending our reputation.

On consultation with the European Union, how certain are we that under the Commission’s purview of the implementation of these directives this will be an acceptable new definition? When reading through the Explanatory Notes to the 2007 regulations, I was slightly perturbed by paragraph 7.5, which gives the Environment Agency more discretion on the sound evidence that exported packaging waste will be reprocessed under conditions that are broadly equivalent to EC requirements. The regulations seem to follow that. It is almost a way of changing the rules in order to meet the target, and I am concerned that there is a little of that flavour here.

I would be particularly interested to hear from the Minister what proportion of these metals are being exported and what he believes is our potential to move that trade back for processing in this country. In terms of miles travelled in export and the resultant energy used and the carbon footprint, that would be a much better solution. Also, I would be interested to know about the destinations for this waste. Does it go to the other side of the globe or elsewhere in Europe? In his introduction to the regulations, the Minister used the phrase, “market intelligence suggests”, which is a slightly inexact form of appraisal of where the waste is going. Is there an inspection regime to check where the waste is destined for? Given the rise in the value of recyclable metals, it is unlikely that they will be thrown away or disposed of in an inappropriate fashion.

I am also interested in the Minister’s answers to the questions put to him by the noble Lord, Lord Taylor, who asked whether the goods are completely legitimate and what the Government are doing to ensure that only legal waste is being exported. However, I welcome the regulations and hope that this regime will prove to be a more effective way of dealing with recycling, but I hope it is not a means by which to change the rules just to meet the targets.

First, I shall answer one of the latter questions asked by the noble Lord, Lord Teverson, which was also implied in what the noble Lord, Lord Taylor, said. In effect, I admitted in my opening speech—although it was not in my text—that there had initially been an element of gold-plating in the regulations. We are now bringing our regulations more directly in line with the wording of the directive. That is the point about paragraph 7.5. I asked colleagues, “By the way, if these were done in 2007”—when I was at Defra—“did I put them through?”. Apparently that was consolidation and they went through in 2005, so I plead not guilty. I also suspect that I would not have spotted it anyway, but I tend to ask about over-regulation and gold-plating. By bringing our regulations more into line with the directive, we are giving flexibility to the Environment Agency. We are not cutting corners; we are taking out what could have been classed as gold-plating.

With regard to the actual metals, it is true that the overall figures are a success. The directive target for the UK, which we have to meet by 31 December this year, sets a minimum of 60 per cent recovery of all packaging waste and a minimum of 55 per cent recycling. The breakdown of that is 60 per cent for glass, 60 per cent for paper and board and 50 per cent for metals. We cannot achieve that without export; that is part of the issue before us. The target for plastics is 22.5 per cent, quite a precise figure, while for wood it is 15 per cent. The UK has an overall business target of 72 per cent recovery of packaging waste in 2008, of which 92 per cent must be recycling.

The noble Lord is also quite right about the cost of some of this. One probably would not get the metal dumped; it is only the people dealing with metal recycling who have made the point to us that there is a difficulty. I have the figures here, but I cannot find them. Aluminium is running at about £1,000 a tonne and steel at £200 a tonne, so quite a lot of money is involved. The energy saved by recycling aluminium is enormous and apparently you can continue to recycle it; it can be recycled an infinite number of times, as I deployed in answer to questions in the House.

With regard to where material is exported to, I am pleased to see that at least one of the places is in Europe: Germany, China, India, Thailand and Malaysia are the areas. These exports are regulated by the Environment Agency, which operates in a sense like a local authority by going out to check the environmental conditions. Metal would not be dumped anyway—it is too expensive, and one can get one’s money back. Where other waste is concerned, there are checks and balances to ensure that there is no dumping. Waste going abroad for dumping is illegal. That is crystal clear.

Here we are dealing essentially with metal. The noble Lord asked about what he heard on the news this morning. I regret to say that that is nothing new. I myself have noticed reports over the past two or three years about church roofs and other areas being affected by what I describe as spivs and malcontents. The idea that they are taking out the copper wires of railway signalling systems is just appalling, and it is right that there is a complete clampdown on that. But the fact is that the stolen metal is being exported; it is not for dumping. That is the point. We need to be able to meet the targets we have been given and that we have accepted. That is the issue here. The Environment Agency is involved in that. It has to be satisfied.

The wording in paragraph 7.5, as the noble Lord picked out, is more akin to what is in the original European directive. We have taken out the bit that we found to be impractical. It was shown in the further evidence note of the Explanatory Memorandum that the cost to industry of producing the paperwork and tracing compared to the cost and the value of the business with regard to metal was so tiny that it would be difficult to achieve it. If we can give the Environment Agency a bit more discretion and it sticks within the rules of the directive, everyone is a winner. The Government—indeed, all of us—want what is exported within the rules to count against our target. Some of the metal is exported and not set against our target because it is too difficult for the end user to organise the paperwork and the certificates. If we can get that into line, what is exported will be counted against the directive and we will be less likely to suffer infraction proceedings. That is the whole point of the exercise.

That was exactly what I suspected: that far more than 20-odd per cent of aluminium is being recycled but is not being recorded because it is not worth the hassle of having these chains of movement certified all the way along the line. In addition, I notice in the Explanatory Memorandum that there is sometimes a break in knowledge because an agency is involved that does not want to reveal where it is moving the stuff on to because it is making a profit out of it; it is then commercially confidential information.

In many ways, I am reassured that the Minister has been able to place on the record the background against which this regime operates. Opening the thing up is possibly quite wise because otherwise we would probably never achieve the targets as the exporting would go on but would never be recorded as UK recycling activity. However, I hope the Minister will agree that a careful eye needs to be kept on this in case it opens the door to illegal activity and to the pirates just as much as to the legitimate operator.

The noble Lord is absolutely right that we need to keep a watch on this. I take that on board completely. Parliamentary scrutiny of the effect of the regulations will be pretty crucial.

I gave some figures when I talked about the targets, but I did not say what is being done and what is being sent abroad, although I gave rough locations. I shall give round figures. In 2007, 2.26 million tonnes of packaging waste—the regulations apply only to packaging waste—were exported for reprocessing, as were 1.5 million tonnes of paper, 217,000 tonnes of glass, 19,000 tonnes of aluminium, 164,000 tonnes of steel, and 320,000 tonnes of plastic. The figure is zero for wood, which I find difficult to understand. Perhaps it is not packaging, but it is on the list. Forty-two per cent of all aluminium was destined for recycling, as was 43 per cent of all steel.

We have a long way to go in many ways. I have no idea about the weight of aluminium cans, although I once did my sums for Parliamentary Questions. I had to work out how much energy recycled drinks cans would save to power a light bulb for a bit because we did not have to use the energy to smelt the bauxite. There is a big bonus here, but we have a long way to go. I am told that by and large, without the regulations, we do not have a prayer of meeting our targets on metals. We are not shifting the goalposts, we are bringing the rules more into line with the original intention, but I fully take on board the point made by the noble Lord, Lord Taylor, that we need to see how the regulations are implemented and what their effect is. As he said, the stuff is being exported, but we want it to count towards our targets.

On Question, Motion agreed to.