Brexit will cost British businesses billions of euros in lost efficiency savings, unless the government develops strong policies to replace the EU’s Circular Economy Package, researchers warned today (23 January).
The EU’s six-bill suite of waste, packaging, landfill, end of life vehicles, batteries and accumulators, and waste electronic equipment laws is aimed at ensuring as little as possible is wasted in a world of finite resources and booming population.
The Aldersgate Group is an alliance of business, political and civil society leaders working for a sustainable economy. It analysed 26 pilot business projects in the UK and Netherlands.
Building on that research, it estimated that adopting resource efficient business models across market sectors such as electrical products, textiles, construction and ICT, could bring an increase of up to €324 billion of gross value added (GVA) by 2030 to the EU economy. Of this, the UK alone could see up to €88.4 billion.
MEPs will vote on a report on the draft package tomorrow (24 January) but the UK faces missing out on the potential benefits of the laws, putting more strain on an economy which is likely to suffer from Brexit.
Nick Molho, executive director of the Aldersgate Group said, “As it prepares to leave the EU, the government should urgently develop a resource efficiency policy.”
The report makes five policy recommendations to the British government;
- develop government policy that is backed by all departments;
- develop standards that require products sold in the UK to be designed to minimise waste;
- help businesses have better access to finance and technical advice;
- build on the success of its landfill tax and promote other fiscal incentives to encourage the re-use of materials;
- improve waste regulations to ensure that secondary materials are not classified as ‘waste’, as long as a safe, alternative use can be found for them.
The European Commission controversially withdrew and re-tabled an earlier version of the Circular Economy Package, prepared under the previous Barroso administration.
The re-tabled package, unveiled in December 2015, included Ecodesign rules for products to make them easier to recycle. But it also had lower 2030 targets for recycling municipal and packaging waste, and replaced a 2025 aspirational landfill reduction target of 25% with a mandatory 10% goal for 2030.
The Commission was accused last year of stalling national waste and recycling policies by withdrawing the package as part of its ‘better regulation’ strategy. At that time only Germany, the Netherlands and the Belgian region of Flanders had a dedicated circular economy plan.
The package is going through the EU legislative process at the moment. Both European Parliament and Council of Ministers can amend the bills but must agree an identical text before they can become law.
The Aldersgate Group has recommendations for those EU policymakers, including changing the definition of waste to encourage the re-use of materials. They are;
- the Ecodesign Working Plan must embrace resource efficiency standards and apply them across an increasingly broader range of products;
- an innovation framework that improves businesses’ access to funding and technical expertise must be supported;
- the Commission should help member states introduce fiscal incentives, such as variable VAT rates, so that circular products and services are promoted over their counterparts.
European Commission Vice-President Jyrki Katainen, who is responsible for Jobs, Growth, Investment and Competitiveness, said, “The circular economy is an important element to modernise the European economy.
“If we want to transform the market economy in a more sustainable direction, we must show there is a business case behind the circular way of thinking.”