Government risks missing ‘triple win’ on remanufacturing
The UK Government must do more to ‘lift the regulatory burden’ on UK remanufacturing if the sector’s ‘enormous economic, social and environmental potential’ is to be realised, a new report has warned today (8 December).
‘Triple Win: The Social, Economic, and Environmental Case for Remanufacturing’ by the All-Party Parliamentary Sustainable Resource Group (APSRG) and All-Party Parliamentary Manufacturing Group (APMG), has been released following an eight-month inquiry chaired by former Environment Secretary Rt Hon Caroline Spelman MP and APSRG and APMG Co-Chair Barry Sheerman MP. The report builds on APSRG’s March 2014 ‘Remanufacturing: Towards a Resource Efficient Economy’ study.
The 108-page document warns that, as the future of manufacturing is ‘inextricably linked to environmental sustainability’, remanufacturing – undertaking a series of manufacturing steps acting on an end-of-life part or product in order to return it to like-new or better performance with warranty to match – must play an increasingly ‘critical role’ in helping reduce the consumption of virgin raw materials and in exploiting new areas of comparative advantage.
It adds that, despite its expansion in recent years, the UK remanufacturing sector continues to face significant barriers to growth due to an ongoing regulatory focus on lower denominators of the waste hierarchy such as recycling, rather than on encouraging minimisation of material usage through remanufacture.
As such, APRSRG and APMG lay out 24 recommendations for government and industry to take to boost remanufacturing, including improving legal clarity, championing collaborative working, and ‘leading by example’.
The report outlines that remanufacturing represents a ‘triple win’ for the UK, as it has ‘economic, environmental and social opportunities’, but that more government action is needed to realise these benefits. However, it notes that the Scottish Government – which this year announced it would be launching a centre for remanufacturing – is ‘leading the drive towards remanufacturing’ in the UK.
APSRG’s March report outlined that the value of remanufacturing in the UK is £2.4 billion, with a potential to increase to £5.6 billion and create thousands of skilled jobs. It also argued that remanufactured products also emit fewer greenhouse gases and consume fewer materials, resources and units of water – thus providing further economic savings, as well as protecting the environment.
As such, APSRG outlines that to best realise these benefits, the following actions should be taken:
- adopt the report’s definition of remanufacturing to overcome confusion over what remanufacturing is;
- work towards improving consumer awareness of remanufacturing;
- work towards improving and increasing financial investment in the UK remanufacturing industry;
- collaborate with industry to create an educational programme and support network to help businesses change their business models to incorporate remanufacturing;
- amend its Guidance on the Legal Definition of Waste to distinguish a product that is due to be remanufactured as being exempt from regulations for waste products;
- review the regulatory barriers to remanufacturing and address the legal anomalies identified;
- develop a certified mark for remanufacturing to demonstrate that products have been tested and fully comply with those standards;
- consider implementing a tax break for remanufacturers in order to ‘encourage economic resilience in the UK remanufacturing industry’;
- invest in developing more apprenticeships in the remanufacturing industry and encourage the development of sustainable design and sustainable engineering modules and courses at universities;
- ensure the Department for Environment, Food & Rural Affairs (Defra), the Department for Business, Innovation & Skills (BIS) and the Department of Energy & Climate Change (DECC) ‘actively promote remanufacturing’ and continue to facilitate the setting up of stakeholder meetings between the UK remanufacturing industry and government;
- develop a Resource Efficiency Action Plan for Leftover Decorative Paint together with representatives from Defra, local authorities, waste management companies, paint manufacturers and retailers, and third-party paint remanufacturers;
- work towards procuring UK remanufactured products (such as office furnishing and electrical equipment) and increasing procurement through service models to support the remanufacturing industry;
- adopt procurement targets to include leasing of remanufactured products;
- work across departments to review relevant legislation and ‘remove perverse incentives’;
- work with the European Commission (EC) to place more policy emphasis on setting targets for reuse and remanufacture;
- work with the EC to eliminate barriers to developing ‘robust remanufacturing markets’ for white goods, paints and chemicals, post-industrial but pre-consumer textiles, and carpet flooring;
- encourage the EC to consider applying energy-efficiency ratings to remanufactured products and, on a case-by-case basis, consider exempting remanufacturing activities from ‘the scope of authorisation and restrictions if there are clear overall environmental benefits in allowing remanufacturing to continue’;
- encourage industry take-up by ‘highlighting and promoting’ the existing drivers that spur on remanufacturing (including lower input costs and subsequent lower prices for customers, as well as environmental benefits);
- encourage companies, universities and public services to include data on the procurement or production of remanufactured goods and landfill diversion in their corporate social responsibility (CSR) reports and encourage these sectors to develop waste prevention targets similar to carbon footprint targets to reduce wastage; and
- encourage the development of an online platform ‘with clear standards’ where businesses can exchange knowledge, components and products.
- ensure original equipment manufacturers (OEMs) and third-party remanufacturers work together to ‘mobilise supply chain communication’;
- explore a system of extended producer responsibility (EPR) on purchased
- products to encourage their return to manufacturers or remanufacturers at the end-of-life stage, and ‘promote shared responsibility throughout the supply chain’; and
- establish a more formal special interest group to support industry in the development of a ‘comprehensive and inclusive mechanism to drive remanufacturing forward, utilising all expertise and excellence present in UK institutions’.
‘Case for achieving greater levels of remanufacturing is undeniable’
Speaking ahead of the report’s launch, inquiry Co-Chair Caroline Spelman MP commented: “The UK can be a world leader in remanufacturing excellence, but only if government and industry set themselves ambitious targets and commit to working together to realise the enormous ‘triple win’ potential that remanufacturing offers in economic, social and environmental terms.
“The opportunities are enormous. Remanufacturing increases the potential for reshoring parts and products, provides opportunities for improving national resource resilience and has the potential for economic growth and the creation of thousands of skilled jobs, particularly at SME level. As we approach the next election, we urge this government and the next to do more to exploit this important new frontier of economic and environmental growth potential.”
Spelman’s fellow inquiry Co-Chair Barry Sheerman MP added: “The case for achieving greater levels of remanufacturing in this country is undeniable, not just in environmental terms, but in social and economic terms also. That’s why this report calls on government to create new apprenticeships across the remanufacturing value chain and ensure sustainable design and engineering courses are taught in higher education institutions across the UK. It is vital that remanufacturing, and the wider circular economy, are put at the heart of government strategies for skills and employment over the next 10 years.”
Read the ‘Tripe Win: The Social, Economic, and Environmental Case for Remanufacturing’ report or find out more about remanufacturing.