Post-Brexit Autumn Statement silent on waste
There was little attention given resource management policies in Chancellor of the Exchequer Philip Hammond’s first Autumn Statement this afternoon (23 November), despite calls for the Treasury to take a long-term view of sustainability.
As the Chancellor explained that the government’s goal was to return public finances to balance as soon as possible in the next Parliament, he announced that Brexit had slowed growth forecasts for the UK and made it “more urgent than ever” to address long-term economic weaknesses.
The statement did indicate, however, that the government’s environmental department is to continue to face budget constraints in the coming years. Hammond said that “departmental spending plans will remain in place and department expenditure in 2021-22 will grow in line with inflation”. In last year’s Autumn Statement, it was announced that the Department for Environment, Food & Rural Affairs (Defra) would have its annual budget cut by 15 per cent (£300 million) for 2016/17, with a further £100 million budget cut every year until 2020.
While the presentation in the House of Commons was unlikely to include any budgetary policies on waste or resource management, the written Autumn Statement report itself also did not address any policy on the topic.
Calls from EAC and ESA ignored
Prior to the Autumn Statement, Parliament’s Environmental Audit Committee (EAC) had criticised the Treasury for putting short-term priorities over longer-term sustainability schemes, which it says could cause greater costs to the economy in the future.
The cross-party committee’s report also said that the Landfill Tax was now a ‘blunt instrument’ that is, after 20 years, no longer nuanced enough to drive continued increases in recycling rates, calling on the Treasury to update its plans for the tax. The EAC also called for the Treasury to indicate how it plans to support further investment in the waste and recycling sectors in the future.
Within the waste and resources industry, the Environment Services Association (ESA), which represents organisations from the sector, called for stronger leadership and policy support to help drive resource efficiency and the long-term competitiveness of the economy.
The association said that five key areas – extended producer responsibility (EPR) reform, green investment allowances, green public procurement, landfill tax and Environment Agency support – should be used to help the UK meet environmental ambitions while developing resilience to external market pressures.
However, there was little mention of any of these areas in the statement.
A tax update accompanying the statement did confirm that changes will be coming on Landfill Tax that will 'bring greater clarity and certainty for taxpayers on the Landfill Tax liability of activities carried out at a landfill site', but that this will 'come into effect after Royal Assent of Finance Bill 2017'.
There was also a brief mention of waste regarding a new National Infrastructure Commission (NIC) that will look at how to develop infrastructure in a variety of sectors (transport, energy, flood defences, water, waste, and digital communications). The statement document read: 'The government has put infrastructure at the heart of its economic strategy and has set up the NIC to provide expert advice on the country’s strategic infrastructure needs and independent recommendations on how to meet them.'
David Palmer-Jones, CEO for SUEZ recycling and recovery in the UK, responded ot this saying: "We still need more long term strategic vision and detail at a national level to ensure waste is treated fully as a resource for both secondary raw materials and energy, so that we in the private sector can continue to invest in the long term infrastructure required to help transition the UK to a more fully circular economy, yielding more economic productivity and jobs creation."
CIWM’s chief executive Dr Colin Church has also commented, saying: “Mr Hammond’s attention has been rightly focused today on setting a stable course for the economy in light of the current state of the UK’s finances and Brexit uncertainty, and the targeted funding support for innovation and infrastructure is welcome. However, CIWM is concerned that the Chancellor’s speech made no reference to climate change proofing future UK industry and infrastructure, or to any imperative for low carbon, ‘green’ growth. It is also disappointing that there was no more detail on the new industrial strategy.
"Productivity is not just about how much we can ‘make’ but also about how we make it. Ultimately, sustainable growth is predicated on UK industry having access to a range of appropriate resources, and this includes the valuable secondary feedstock materials and energy products that the waste and resource management sector can deliver. It is to be hoped that somewhere in the emerging detail over the coming months, resource productivity will be clearly identified as one of the priorities, especially given the impact that volatile commodity markets and potential Brexit-related raw material price rises could have on UK plc.”
Environmental groups criticise statement
Responding to Hammond’s statement, WWF-UK’s Director of Advocacy Trevor Hutchings said: “An ever-shrinking natural environment, climate change, air and water pollution, and declining wildlife populations present our economy with risks and costs that could run into billions…
“It’s therefore unfortunate that the Chancellor did not have more to say about green growth… The significant investments in infrastructure he did outline need to be designed to avoid, minimise or offset environmental damage.”
Liz Hutchins, Senior Campaigner at Friends of the Earth, added: “The Chancellor is pootling along in the slow lane, when the UK needs to be on the fast track to a low-carbon economy. With Donald Trump appointing climate deniers and oil lobbyists to his transition team, this is a huge missed opportunity for the UK to show the global leadership and urgency needed to protect our planet.”
Low-carbon announcements ‘jam tomorrow’
While there was no mention of resource management policy in the statement, there were mentions for low-carbon transport (in the form of £390 million funding “to build on our competitive advantage in low-emission vehicles and the development of connected, autonomous vehicles”) and a National Productivity Investment Fund (NPIF) of £23 billion to be spent on innovation and infrastructure over the next five years.
Dustin Benton, Acting Deputy Director of the Green Alliance environmental think tank, said: “The Chancellor announced £23 billion in investment today for the economy of the future. That future is low carbon, so we should make sure our infrastructure is too. But most of the low-carbon announcements today are jam tomorrow…
“But the bigger picture is of overstretched public finances. If there’s no money on the table, we should use smarter regulation to drive the investment in the low-carbon and resource-efficient infrastructure we’ll need for the future.”
During his presentation, Hammond also announced that the Autumn Statement as an update on the government’s budget would be abolished from 2017, with the main budget announcement instead being made in the autumn. An update from the Office of Budget Responsibility (OBR) will be presented in the spring, but will not be accompanied by a government response in the form of budget alterations.
HM Treasury’s Autumn Statement 2016 can be read in full on the department’s website.