By Neil Carrett, Technical Manager, London CRN (13 September 2005)

Dear Sir/Madam,

Altering The Funding Mechanism For Joint Waste Disposal Authorities And Their Waste Collection Authorities - A Consultation Paper

In response to the specific questions outlined in the paper we would like to submit the following views:

1. Do you consider, in principle, that introducing a tonnage-based default levy to be the best way of introducing a link between the size of the levy on the waste collection authorities and the amount of waste they deliver to JWDAs for disposal? If not, please give reasons.

We strongly agree and cannot propose any more workable alternatives.

2. Do you agree that the other elements of the JWDAs costs, aside from disposal costs, such as administration costs and the costs of running the JWDA civic amenity sites should be excluded from the new funding mechanism and instead continue to be funded through a levy based on the current council tax base? If not, please state how these costs should be funded.

Agree

3. Do you agree that the Secretary of State should remove the duty for all JWDAs to pay recycling credits to their collection authorities? If not, please give reasons.

This arrangement should not automatically be adopted as a default. When available as an option it should only be able to be undertaken with the agreement of all constituent WCA’s. Whilst the perverse double payment issue provides a good justification for changing the current system (in the context of adequate financial incentives to adhere to the waste hierarchy), any shift towards this arrangement should be sequentially phased with other changes, particularly to waste management procurement, to minimise any deleterious impacts that may arise.

Of particular concern is the impact that the loss of any infrastructure for the payment of credits will have upon the payment of said credits to community sector organisations currently in receipt of third party payments. Direct service delivery enabled by substantial changes to local authority procurement is the ideal for community sector organisations, rather than discretionary payments. However, whilst there is considerable theoretical movement in this area there is significant tension with Defra’s drive towards economies of scale in waste management procurement.

Clarification on how incentives for community level activity may be safeguarded in JWDA areas is sought. If it is the case that third party credits are likely to cease it is suggested that transitional measures (i.e. the retention of third party credits at 2004/05 levels for an additional financial year) may be appropriate until any changes to waste procurement arising from the ongoing Second Kelly Market Study have a chance to bed down. Even a small gap in financing would decimate infrastructure that would otherwise be available to deliver services in the future under new procurement arrangements.

4. If the levy default were changed to a tonnage basis, do you agree that the levy should be based on historical data of waste volumes delivered to the JWDA from previous years? If not, please give reasons.

Cannot see any alternative in most instances. However, considerable year on year changes are expected in tonnages delivered. Could also be set by unanimous agreement between all constituent collection authorities. Early assessments could be made to actual vs projected tonnages throughout the financial year in question and quarterly adjustments made where necessary.

5. If a tonnage-based levy were introduced, do you agree that the method of calculation should be left to individual JWDAs? If not, please give alternative.

This should be flexible as per response to question 4.

6. Noting the potential challenge for some JWDAs and their constituent authorities in moving to a tonnage-based levy in April 2006, do you consider there to be any action that Government should take centrally to assist with the transition. If so, please give reasons.

See response to question 3 above. It is not assumed that central government should, or indeed is in a position to provide any direct assistance to such organisations over and above current support. However, the OGC and OFT have recognised that public sector waste management procurement is potentially not encouraging an effective market. Under these circumstances some form of support to underpin ongoing activities is appropriate until the market can be made to work more effectively.