Environment

2016 / 2017 ENVIRONMENT

A Y E A R I N P E R S P E C T I V E

F O R E W O R D S The Rt Hon Theresa May MP The Rt Hon Michael Gove MP Tom Delay

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Foreword

The Rt Hon Theresa May MP Prime Minister

FOREWORD | deliver the next phase of high-speed rail, improve our energy infrastructure and support the development of automated vehicles and satellite technology, building a modern economy which creates the high-skill jobs of the future. At the same time, work needs to be done to build a fairer society – where people can go as far as their talents will take them and no one is held back because of their background. So we will continue to work to ensure every child has the opportunity to attend a good school. We will continue to invest in the NHS and reform mental health legislation, making this a priority. And we will work to address the challenges of social care for our ageing population, bringing forward proposals for consultation to build widespread support. So this is a Government determined to deliver the best Brexit deal, intent on building a stronger economy and a fairer society, committed to keeping our country safe, enhancing our standing in the wider world, and bringing our United Kingdom closer together. We will continue to put ourselves at the service of millions of ordinary working people for whom we will work every day in the national interest. This year’s Parliamentary Review follows a significant year in British politics “ “

This year’s Parliamentary Review follows a significant year in British politics. It was a year in which our economy continued to grow, as the Government followed its balanced plan to keep the public finances under control while investing to build a stronger economy. It was a year in which we began to deliver on the result of the EU referendum by triggering Article 50 and publishing the Repeal Bill, which will allow for a smooth and orderly transition as the UK leaves the EU, maximising certainty for individuals and businesses. And, of course, it was a year in which the General Election showed that parts of our country remain divided and laid a fresh challenge to all of us involved in politics to resolve our differences, deal with injustices and take, not shirk, the big decisions. That is why our programme for government for the coming year is about recognising and grasping the opportunities that lie ahead for the United Kingdom as we leave the EU. The referendum vote last year was not just a vote to leave the EU – it was a profound and justified expression that our country often does not work the way it should for millions of ordinary working families. So we need to deliver a Brexit deal that works for all parts of the UK, while continuing to build a stronger, fairer country by strengthening our economy, tackling injustice and promoting opportunity and aspiration. In the year ahead we will continue to bring down the deficit so that young people do not spend most of their working lives paying for our failure to live within our means. We will take action to build a stronger economy so that we can improve people’s living standards and fund the public services on which we all depend. We will continue with our modern Industrial Strategy,

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Foreword

We have a once in a lifetime opportunity to reshape our relationship with our land, our rivers and our seas. By delivering a Green Brexit we can reform how we manage agriculture and fisheries, and how we protect our natural environment. I want Britain to be a global champion for sustainable development, a world leader in environmental science, and a setter of gold standards in protecting and growing natural capital. That is my Department’s driving ambition – and it should be central in the next five years of our national mission. The first step is our 25-year Environment Plan – setting out how we manage our natural assets to create a lasting legacy for future generations. Laying the ground for this, I have asked the Natural Capital Committee’s advice on what the plan should aim to achieve, where improvements are most urgent and where the benefits are greatest. This work will help shape the upcoming Agriculture and Fisheries Bills and how we use public money to reward environmentally-responsible practices. These bills will provide stability for farmers as we leave the EU and make sure we can continue to protect and enhance our environment and, as an independent coastal state, do more with conservation. The Common Agricultural Policy will be replaced. Our new agricultural policy will recognise the importance of improving production as well as protecting our strong food and animal welfare standards and it will ensure farmers are rewarded for providing environmental goods – whether that’s protecting or enhancing habitats for biodiversity or planting more trees to combat soil erosion. The Rt Hon Michael Gove MP Secretary of State for Environment, Food and Rural Affairs

We will also no longer be wedded to the Common Fisheries Policy (CFP). The CFP has encouraged fishing at a rate more than 50% above scientific advice. Our new approach will put the best interests of UK fishermen at its heart along with the highest standards of marine conservation. In reshaping both of these policies, our central aim is the enhancement of our environment. Building on existing European standards, we can make Britain a global leader – creating, new institutions, mechanisms and gold standards for protecting our environment. We also have an opportunity to be global leaders in the fight against climate change, the struggle against the illegal wildlife trade and in the promotion and enhancement of animal welfare. I hope that in years to come people can look back and say our generation lived up to the challenge and handed on a greener, cleaner, better, richer planet to the next generation. We have an opportunity to be global leaders in the fight against climate change “

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Foreword

TomDelay Chief Executive of the Carbon Trust

There is no question that it has been a turbulent year in British politics. Brexit has created a variety of serious challenges, not least the fact that many of the current UK’s environmental and energy regulations have been influenced at a European level. Alongside this, an unexpected general election has slowed – but not stalled – progress on the transition towards building a sustainable, low carbon economy. The uncertainty around Britain’s future outside the European Union has raised a number of thorny issues. For example, the future of the nuclear industry – already facing serious scrutiny in the face of continued cost overruns and delays to Hinkley Point C – has been thrown further into doubt by the impending departure from European atomic energy community, Euratom. Similarly, the future of the natural environment is very much up for grabs as Britain leaves the Common Agricultural Policy and Common Fisheries Policy. The draft 25-year plan for the natural environment by Defra provides hope that this will be done in a way that improves the health of land and seas around Britain. But bold pledges are not yet matched with clear policies to achieve them. One bright spot is that the fifth carbon budget was passed by Parliament, meeting the requirements of the Climate Change Act and providing long-term certainty on UK emissions targets beyond 2030. And, thanks to the rapid decline in coal use, UK carbon emissions have dropped to a level not seen in normal circumstances since the 1890s. Although it is worrying that the Government’s Clean Growth Plan, setting out how to actually deliver on these goals, has faced repeated delays in publication.

FOREWORD | The past year also saw the launch of a forward-looking Industrial Strategy, with one of its central pillars focusing on the need to drive clean growth. The previous Government’s Green Paper on the subject set out clear support for important future technologies where the UK has the opportunity to be a world leader, including offshore wind, energy storage and electric vehicles. In particular, the offshore wind sector is showing great potential – the fruits of over a decade of investment, much of which was driven by strong government support for the nascent industry. And within Parliament, it is heartening to see select committees have continued their excellent work scrutinising the Government and asking tough questions. Recent work has helped to draw attention to important environmental challenges such as the impact of microplastics, packaging waste, soil health and air quality. All things considered, the good news is that within Parliament there is still a strong cross-party consensus on the importance of protecting the natural environment and continuing to take action on climate change, both in the UK and overseas. However, over the coming year it is crucial that good intentions are backed up with genuine progress. Brexit will remain a distraction, but it should not be an excuse for inaction. UK carbon emissions have dropped to a level not seen since the 1890s “ “

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Andrew Neil

Return of the Two Party System The BBC’s Andrew Neil gives his take on the state of Parliament following the June 2017 general election.

Nationalist party and a resurgent Tory party representing the Union. Two-party politics was back north of the border. So we should have been prepared for something similar when Britain voted 52% to 48% to leave the European Union in the June 2016 referendum. At the time, we remarked on the power of referenda to overrule both the Commons (where MPs were 65% pro-EU) and the Lords (probably 80% pro-EU). What we did not see was how the Brexit referendum would reconfigure English politics just as the Scottish referendum had redrawn Scottish politics. So we were taken by surprise for a second time. In this year’s general election – perhaps the single biggest act of self-harm a sitting government has ever inflicted on itself – almost 85% in England voted either Conservative or Labour. The English had not voted in such numbers for both major parties since 1970, when the post-war two-party system began to wane – and declined in subsequent elections to a point where barely 65% voted Tory or Labour, encouraging some commentators to think the decline terminal.

The referendum, however, reversed the decline. The Brexit vote ended the schism on the Eurosceptic Right as UKIP voters returned to the Tory fold; and those on the Left of the Greens and the Lib Dems flocked to Jeremy Corbyn’s more ‘Red Flag’ Labour offering. So, as in Scotland previously, two-party politics was back with a vengeance in England too. But without one crucial element. Our historic two-party system regularly produced one-party government for the life of a Parliament. But our new two-party system has produced a hung Parliament with no party having an overall majority. This knife-edge parliamentary arithmetic means the smaller parties may be down – but they are not out. The Conservatives need an alliance with one small party (Ulster’s DUP) to be sure of a majority. Even then, with the Tories and Labour divided over Brexit, no majority on any issue will be certain and on many votes the smaller parties will be pivotal in determining many outcomes. So politicians return from their summer recess to a great parliamentary paradox: the two-party system has resurrected itself but rather than bringing with it the stability and certainty of the two-party politics of old, almost every major vote in the months ahead will be uncertain and unpredictable – and politics will be peculiarly unstable. Power will rest in Parliament. Government will be able to take nothing for granted. No vote will be in the bag until all the votes are counted. Westminster will have a new lease of life – perhaps even a spring in its step. Our democracy might be all the better for it.

It was a year in which politicians learned not only of the power of a referendum to overrule the will of Parliament – but of its power to change the party system in which they operate. Nobody saw this coming. But, in retrospect, perhaps we should have, since we had the fallout from the Scottish referendum to guide us. In the autumn of 2014 the Scots voted 55%-45% to remain part of the United Kingdom. That was supposed to settle the matter of Scottish independence for a generation, until some Scottish Nationalists began regarding a generation as no more than a couple of years. But in post- referendum elections to Holyrood and Westminster, it also recast the Scottish party system. Remember, Scotland had been one of the first parts of the UK to throw off the British two-party system and replace it with a multi-party choice of SNP, Labour, Tory, Green, Lib Dem and even UKIP. But as the constitutional issue took centre- stage – and remained there even after the referendum – Scottish voters coalesced round a binary choice: for or against independence. Thus was a new two-party system born of a centre-left Nationalist party (the SNP) and a centre-right Unionist party (the Scottish Tories). The other parties have not been completely obliterated, especially in Holyrood with its peculiar voting system. But by the general election

of 2017 Scotland had become a battle between a dominant

Neil believes two referendums have redrawn the map of British politics.

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ENVIRONMENT

Review of the Year

Brexit

Having to wait and see was unnerving for many environmentalists. Much of the green legislation and regulation in the UK concerning environmental protection was directly or indirectly related to the EU. Air and water quality, renewable energy, waste reduction, habitat and wildlife protection were all areas that could easily be traced back to EU- wide origins. In its statement on Brexit, campaign group Friends of the Earth called for a continuation of collective responsibility. It said ‘If we want to tackle the urgent global environmental challenges we face, then we have to work together – regardless of our background, our country of birth, or where we live.’ Ministers were eerily quiet on the issue during the parliamentary year. A search of the session’s Hansard shows that there was no statement from Defra. In the Commons, Labour MP for Brent North, Barry Gardiner, tabled a debate on energy and the environment following the referendum. He said the uncertainty had led to investors choosing to wait and see. He said this posed real risks for the country’s electricity infrastructure as it attempted to make the transition to a clean energy mix.

Many in the UK feel uncertain regarding the impact of Brexit

In January 2017, Prime Minister Theresa May gave a speech at Lancaster House, outlining the broad arguments that would shape the UK Government’s negotiating position when it entered talks with the European Union. She outlined 12 objectives, from stability to a smooth and orderly Brexit. None of these objectives dealt with the environment. Flood prevention While most parts of the UK managed to escape winter storms during this session of Parliament, the impact on homes and businesses was still being debated. This was hardly surprising, considering the level of hardship the winter

storms of 2015-16 caused in many communities across northern England, many of which were still recovering from the havoc a full 12 months after the floods. It has been estimated that five million people live in areas at risk from flooding.

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THE PARLIAMENTARY REVIEW Review of the Year

The storms in 2015-16 delivered record levels of rainfall. Figures suggest that Storm Desmond alone cost the UK economy in excess of £5 billion. The Environment, Food and Rural Affairs Select Committee called for the adoption of a new model to protect communities against flooding in the future. It said current levels of government funding was unlikely to be sufficient to protect communities in the future, especially once climate change was taken into consideration. Instead, the MPs called for the creation of a new post, a National Floods Commissioner for England, who would be responsible for co-ordinating long- term flood reduction strategies. The Committee also called for a greater focus on catchment areas to ensure that they held floodwater for longer, reducing the volume of water entering the rivers during extreme storms. This would include planting more trees and improved soil management, they said. The Government’s preferred choice for the new Chairman of the Environment Agency to replace Lord Chris Smith was Emma Howard Boyd. Although the agency had a wide brief, the issue of flooding was not far from the top of the agenda of MPs as they scrutinised her. When appearing before the Efra Committee, Ms Howard Boyd said that the response to flooding was the responsibility of the chief executive and agency staff, but added that it was important to be ‘visible and take part in visiting those communities that have been affected by the flooding’. In September, the then-Environment Secretary, Andrea Leadsom, made a statement about the Government’s National Flood Resilience Review, headed by the then-Chancellor of the Duchy of Lancaster, Oliver Letwin.

New alleviation schemes have been introduced around the country, following the devastating effects of floods last year

She told MPs ‘The magnitude of these events means that we need to fully understand the scale of risk that the country is currently facing from river and coastal flooding. We need to take immediate steps to improve our resilience to this flooding.’ Ms Leadsom said the Review had identified more than 500 infrastructure facilities, such as power stations and roads, that were vulnerable to river and coastal flooding. She added that a better understanding of the risk would help improve planning and management of flooding. She said that the Government continued to increase funding available for flood protection measures. The winter storms of 2015–16 were described as the most extreme on record ‘by a substantial margin’. A study by the Centre for Ecology & Hydrology (CEH), in collaboration with the British Hydrological Society, found many rivers across northern England, Scotland and Northern Ireland saw record peak flows during the three- month period. It said the rivers Eden, Tyne and Lune in England saw record peaks of about 1,700 cubic metres per second. Experts say such levels could fill London’s Royal Albert Hall in less than a minute.

Andrea Leadsom served as Environment Secretary prior to the Cabinet re-

shuffle that followed the General Election

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ENVIRONMENT

Although last winter’s floods were more extreme in scale, flooding in 1947 had a greater impact in terms of homes flooded and crops destroyed, the appraisal found. However, lead author Terry Marsh from CEH said the national scale of last winter’s floods were ‘the most extreme on record’.

‘The associated flooding was both extensive and repetitive, and total river outflows from Great Britain following the passage of Storm Desmond in December exceeded the previous maximum by a substantial margin,’ he said.

Plastic pollution

Estimates suggest that up to 219,000 tonnes of microplastics enter the seas and oceans around Europe per year. The Committee’s MPs also voiced concern that little was known about the possible accumulative effect that microplastics would have on the human food chain. They said ‘If someone eats six oysters, it is likely they will have eaten 50 particles of microplastics. Relatively little research has been done on potential impacts to human health or the marine ecology.’ The cosmetic industry was aware of the potential damage to the environment. They had voluntarily agreed to phase out the use of the tiny plastic particles by 2020. However, that was not soon enough for Mary Creagh. Her demands followed on from a similar ban introduced by the US in 2015. However, the EU said that an outright ban may not be necessary as many of the major cosmetic companies were committed to phasing out the use of microbeads. If a ban was not possible then, the MPs added, proper labelling was possible. This would allow consumers to know if there were microbeads in products. ‘Most people would be aghast to learn that their beauty products are causing this ugly pollution,’ Ms Creagh suggested. Backbench MPs were still putting pressure on Minsters to act on microplastics, as the session was drawing to a close.

Plastic litter is often found along the UK coastline, and is indicative of the wider problem with pollution

Recent concern about the environmental threat posed by plastic prompted MPs to look at the matter more closely. Considering the environmental impact of tiny (smaller than 5mm) pieces of plastic, otherwise known as microplastic, deemed the cost to be too high and called for the use of plastic beads, used in cosmetic products, to be banned. ‘The best way to reduce this pollution is to prevent plastic being flushed into the sea in the first place,’ observed Committee Chairwoman, Mary Creagh. During its inquiry, the Committee heard that up to 100,000 microbeads could end up in the drainage system during a single shower. on the marine environment, the Environmental Audit Committee

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THE PARLIAMENTARY REVIEW Review of the Year

The energy needs of the UK always crop up in parliamentary debates during the course of a session. In the past, it has been meeting the growing demand for electricity. During the 2015 election campaign, it was the rising costs being paid by customers. This session, it was the role of nuclear, in particular the proposed Hinkley C reactor in Somerset. The proposals not only raised concerns among environmental campaigners, there were voices of concern in relation to its funding arrangements. Philip Hollobone, Conservative MP for Kettering, asked what action the Department for Environment, Food and Rural Affairs was taking to curb microbeads that were not covered by the proposed ban. Defra Minister, Dr Thérèse Coffey responded by saying that a public consultation had just concluded and her Department was considering the findings. In March 2017, Rebecca Pow, Conservative MP for Taunton Deane, secured a Commons debate on the issue. She called for the delivery of a proposed ban. ‘Let us not sacrifice our precious seas and the creatures that depend on them, and indeed the health of future generations. We must do right by them,’ she told MPs. It was a call echoed by Labour MP Kerry McCarthy. While she praised the Government for going ahead with legislation to limit the use of microbeads in cosmetic products, she voiced concern that some products may slip through the gap. She also called on the UK Government to play a leading role on the issue internationally. Nuclear power

Micro-plastics are one of the chief concerns that environmentalists want tackling

In September 2016, Energy Secretary, Greg Clark, gave the project the green light. In a statement, he told the Commons ‘This £18 billion investment in Britain provides an upgrade in our supply of clean energy’. Responding to the news of the Government green-light, Green Party MP, Caroline Lucas, called the scheme the ‘most expensive white elephant of a project in British history’. Writing in The Guardian newspaper, she said the economics of the project Responding for the Government, Thérèse Coffey said that Defra was making good progress in terms of putting the necessary framework in place in order to implement a ban. The Minister also added that she had been advised that, at current levels, microplastic in the marine environment was unlikely to pose concerns for human health. ‘The Food Standards Agency considers that it is unlikely that the presence of low levels of microplastic particles that have been reported to occur in certain types of seafood would actually cause any harm to consumers,’ she reported. However, she did add that the Food Standards Agency would continue to monitor and assess the situation.

Nuclear power is seen as a key area of growth by energy suppliers

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the delivery of the Paris Agreement in December 2015. The central pillar of the UK commitment to the global deal was the Climate Change Act, which required the nation to cut its greenhouse gas emissions by 80% from 1990 levels by the middle of the century. While renewables, such as wind power, were playing an increasingly important role, concerns over these technologies’ intermittent nature meant that there was a need for a generation technology that could deliver large base-loads while limiting carbon emissions. This is where nuclear power plants came into the picture. Opponents said government support for new nuclear projects was at the expense of other low carbon generation technology, such as wind and solar, as well as investment in research and development in electricity storage capacity. The Hinkley project has received wide coverage by state-controlled Chinese media, which has presented it as being demonstrative of China’s increasing importance in the global energy market. Described by the China Daily news agency as a ‘flagship project of China– Britain cooperation’, Hinkley C would provide 7% of the UK’s electricity. The Chinese investment, by the China General Nuclear Power Corporation (CGN), with EDF, the French state- owned energy company, has raised concerns about national security in some quarters. Only days after work on the project began, there were media reports of a dispute between the workforce and managers over bonus payments, highlighting the challenges facing the construction of the UK’s first nuclear reactor for more than 20 years.

Chinese investment in the Hinkley project has been essential, but has also received criticism

were unjustifiable and added that the ‘terrible deal’ was, environmentally, extremely risky. ‘Over its lifetime, Hinkley will produce waste equivalent to 80% of all the waste so far produced in the UK in terms of radioactivity,’ she observed. ‘Having such highly dangerous spent fuel on site for up to 200 years will be a massive challenge.’ In his statement to MPs, Clark said safety was the ‘number one consideration’. He said ‘The construction of Hinkley Point C will be under the close scrutiny of the Office of Nuclear Regulation, which is independent of the industry and Ministers. ‘It has the power necessary to halt construction or require amendments to any part of the plant if at any point it is not completely satisfied with the safety of any part of the reactor and its associated construction.’ The need for the UK’s energy mix to invest in new technologies formed the bedrock of the policy to make the transition to a low-carbon economy which was reinforced by

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THE PARLIAMENTARY REVIEW Review of the Year

Concern over the health of the seas surrounding the UK has been increasing. There has been a growing campaign to limit the amount of so- called microplastics ending up in the ocean, amid fears of damage to marine ecosystems, and the long-term threat it poses to the food chain. The Conservatives, in their 2015 election manifesto, promised to protect the marine environment by creating a new ‘blue belt’ of protected areas. During the session, the Environmental Audit Select Committee felt it was an issue worth looking at again. In their report, Marine Protected Areas Revisited, published in March, they said that they were disappointed with the Government’s progress on the manifesto promise. ‘It is worrying and disappointing the Government have still not got their act together on assigning the vulnerable Marine Protected Areas,’ said Committee Chairwoman, Mary Creagh. ‘The Government needs to put firm plans in place to stop further degradation of our vulnerable ecological systems, before they are destroyed forever.’ In their manifesto, Ministers pledged to ‘complete the network of Marine Conservation Zones (MCZs)that we have already started, to create a UK Blue Belt of protected sites’. However, writing in March 2017, the Environmental Audit Committee said that only 50 MCZs had been created, well short of the 127 target that had been recommended by experts. Marine protected areas are sites of marine habitat that are partially or fully protected from activities that are deemed to have a damaging effect. In September, the Wildlife Trust published a report that identified 48 areas in the waters around the UK coastline that, the organisation said, needed to be listed Marine protected areas

Conservationist groups have criticised the government’s lack of drive in legislating for the ‘blue belt’

as MCZs in order for an ecologically coherent network to be completed, delivering a ‘blue belt’ as promised in the Government’s election manifesto. However, the policy area did not seem to feature highly among minsters. The topic is not featured on the Defra website, and a search of Hansard failed to reveal any ministerial statements on MCZs during the session. MPs, in the Environmental Audit Committee, called on the Government to put forward an ‘ambitious third tranche’ of designated MCZs. They added that, despite the UK having some of the best marine data in the world, the evidence requirements from Defra in order for sites to be designated MCZ was too high, and it was a problem that was compounded by the lack of funds available for the necessary information to be harvested. Brexit also resurfaced above the waves in a Commons debate on marine habitat in October. Labour MP for Exeter, Ben Bradshaw, said that EU law had played an important role in protecting marine life and asked whether similar measures would remain in place once the UK had left the European Union.

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The then-Environment Secretary Andrea Leadsom responded that she could give that assurance, adding ‘Marine conservation zones derive from UK legislation, and we remain absolutely committed to our ambition of being the first generation to leave the environment in a better place than we found it.’

Progress on advancing the network of Marine Protected Areas is unlikely to be among Defra’s priorities in the near future as it prepares to be deluged with coping with the nation’s withdrawal from the European Union. Scope for embarking on additional policy advances is set, at best, to be limited.

Decarbonisation

The delivery of the historic Paris Agreement on climate change increased the grip on public policy to make a transition to low-carbon economy. In the second half of this century, the world is aspiring to be a carbon-zero society. This means that there is a real need for decarbonisation technology to play a central role in the main sources of emissions: energy, transport, construction, land-use change etc. One of the main strategies that has been seen as an essential component of making the shift to cleaner forms of energy was carbon capture and storage (CCS). Supporters of the technology said the development of commercially viable CCS plants would allow traditional forms of electricity generation – gas- and coal-fired power stations – to remain part of the global energy mix in the future. Government support for the technology was made clear in 2012 when it was announced that there would be a £1 billion competition to develop a commercial-scale model that could be retrofitted to existing fossil fuelled power stations. It was a shock to many when the competition was scrapped in 2015, becoming a victim of Chancellor George Osborne’s austerity measures. However, the technology was not left on the scrap heap. Other nations, including

Germany and the US continued with research and development. Philip Boswell, the Scottish National Party MP, raised the issue in a Westminster Hall debate, saying that the cancellation of the competition was just part of the Government’s wider movement back from supporting greener, cleaner energy. He said ‘The litany of cancelled, diluted and abandoned renewable and green initiatives, as well as those within the energy industry as a whole, have virtually destroyed investor confidence.’ However, the then-Business Minister, Jesse Norman, responded by saying that the Government remained committed to CCS technology but it needed to find a cost-effective way of delivering it. The Government was much more willing to champion offshore wind turbines, which now accounted for 5% of the UK’s electricity requirements, with a further 4.5GW of capacity under construction, according to the UK Crown Estate. In June, National Grid reported that renewable sources of energy generated more electricity than coal and gas in Great Britain for the first time. As the Government launched a commission to consider the nation’s long-term infrastructure needs, Lord Deben, the Chairman of the UK Climate Change Committee, wrote that it was necessary for any strategy looking in to the future to consider the twin factors

Carbon capture technology is one of many initiatives that the government has considered to lower carbon emissions

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When Theresa May announced her first cabinet in July 2016, many pundits thought it signalled the end of Michael Gove’s ministerial career. The former Education Secretary, Lord Chancellor and chief Brexiteer had never had the cosiest of relationships with his party’s new leader. When May was at the Home Office and Gove at Education, the pair clashed on more than one occasion, most memorably in the summer of 2014. The ‘Trojan Horse’ affair, involving the alleged ‘Islamification’ of secular schools in Birmingham, saw the two ministers trading accusations against one another. The fallout saw David Cameron demanding apologies from both parties, May losing a key advisor and Gove losing his role as Education Secretary altogether. Two years later, with Gove comprehensively defeated by May in the Conservative leadership contest, it was reasonable to suspect he had no chance of ever appearing in her Government. To no one’s surprise, he was sacked from his role as Lord Chancellor and dumped onto the backbenches. Return of Michael Gove of reducing greenhouse gas emissions and the need to make infrastructure resilient to climate change. In a letter to Lord Adonis, the Head of the National Infrastructure Commission, Lord Deben wrote ‘Given the long lifetime of many infrastructure investments, decisions made now must avoid locking-in high-carbon infrastructure. ‘They must also keep open options for reducing emissions close to zero, which may be required in electricity generation, heat and transport to meet the overall 2050 target.’

And yet, just one year on, he’s back. Humbled by the loss of seats in the 2017 snap general election, and the new reality of running a minority government, May is aware of the importance of keeping her party together. Gove’s appointment as Environment Secretary was the headline of her post-election reshuffle and the early signs indicate that her former adversary is growing rapidly into the role. On the 21 st July, he gave his first major speech in the role at the WWF’s Living Planet Centre. He expressed his disappointment at President Trump’s decision to withdraw the US from the Paris Climate Agreement, adding that ‘the world’s second biggest generator of carbon emissions cannot simply walk out of the room when the heat is on.’ He described leaving the EU, the Common Agricultural Policy and the Common Fisheries Policy as an ‘unfrozen moment’ where new possibilities occur. By the time next year’s Parliamentary Review is published, we should have He added that preparing for climate change included flood risk management and drainage, as well as water resource management and supply, in order to ensure that the UK was resilient to future changes in climate. One area that seems to struggle to attract much attention was energy efficiency, and improving the performance of devices, equipment and industrial processes. Although it was the subject of numerous debates in the Houses of Parliament in recent years, it was normally in the context of fuel poverty and the need to reduce household energy bills.

Michael Gove’s return to the front benches signals an attempt to bring greater unity to the Conservatives following their disappointing election result

a greater idea of how these new possibilities are being explored.

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FCC Environment

The Greatmoor Energy from Waste facility in Buckinghamshire diverts 300,000 tonnes of waste per year from landfill turning it into 22MW of electricity

Paul Taylor, Group Chief Executive

P ost-Brexit Britain presents the country with an unprecedented opportunity to develop a better approach to UK waste policy, says FCC Environment Group Chief Executive, Paul Taylor. But can the country step up to meet the challenge? For a long time, UK waste policy has been ignored by Westminster – in no small part because it has historically been driven by EU law. This has meant that there have been limited opportunities for the UK to decide the direction of its own domestic waste policy. It has also meant that the sector’s ability to contribute to the UK’s growth and productivity has been limited, with other sectors edging ahead in the race for increasing competitiveness and resource productivity. Until now. Following the appointment of Michael Gove to Defra, we are calling for a step change in how the UK’s waste and resources sector is viewed in this country. Although the road ahead remains unclear, what we do know is that Brexit provides us with an opportunity to have a frank conversation about the value in waste, and how it can help to boost the country’s competiveness. The potential of the UK waste industry A new report published by Policy Exchange in early March 2017 unveiled the economic potential of the UK waste sector. ‘Going Round in Circles’ highlights a number of significant shortcomings in the EU’s current approach to waste, including unclear and muddled objectives, a failure to reflect economic fundamentals (such as plummeting commodity prices), and a utilisation of poor data and definitions which are making it difficult to develop effective policies.

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»» Waste and resource management company based in Northampton »» Employs more than 2,000 people across 400 facilities in England, Wales and Scotland »» Provides municipal services, business waste solutions, recycling, green energy and waste processing and disposal »» The business aims to be the environmental company of choice, delivering change for a sustainable future »» FCC Environment is part of one of the world’s largest

environmental services companies, Fomento de

Construcciones y Contratas (FCC), based in Spain, which employs around 90,000 people

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THE PARLIAMENTARY REVIEW Highlighting best practice

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The Government has specifically identified energy as a key

Most strikingly, Policy Exchange’s research reveals that following EU waste policies post-Brexit would cost British businesses and households an additional £2 billion over the next 20 years. New control, new policies Given these shortcomings, it is clear to us that the Government should not simply settle for the ‘one-size-fits-all’ approach previously adopted by EU environmental directives. Leaving the EU provides the Government with greater flexibility to decide our own policy direction and address endemic resource efficiency problems within the UK economy. Instead, we would like to see the UK take back control of its own waste, and create a more coherent set of policies which better suit the UK’s fiscal environment. The economic opportunity for businesses from more effective waste management is stark. The Waste Prevention Programme for England notes that inefficiency in the use of resources ‘results in increased costs to businesses for the

purchase of unnecessary materials, and in the costs of disposing of those materials.’ Research by Accenture has shown that there is potential to unlock $4.5 trillion of global growth through improvements in resource productivity. This is why we would like to see a re-focus on maximising resource productivity within the UK economy. The new Industrial Strategy has highlighted a willingness to address the significant opportunities that have emerged post-Brexit. Effective waste management techniques and investment in waste infrastructure can form the backbone of this drive for greater productivity and global competitiveness. We would also like to see an emphasis on further developing Energy from Waste (EfW) capabilities in the UK. In ‘Going Round in Circles’, Policy Exchange found that EfW is a cost-effective, scientific and innovative treatment process. Its efficiency lies in the re-use of waste for energy, which can be used to heat homes, offices and shops.

part of its Industrial

Strategy and it has highlighted resource productivity as a central pillar of the plan

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The High Heavens Waste Transfer Station in Buckinghamshire bulks and transports waste from the south of the county to feed into the Greatmoor EfW

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ENVIRONMENT

The tipping hall at Greatmoor EfW where waste arrives for processing

Where does FCC Environment fit in to post-Brexit solutions? With all the new opportunities posed by last June’s Brexit vote and a shake-up of the UK administration, FCC Environment hopes to play an invaluable role in providing innovative solutions to the Government’s Industrial Strategy. As one of the largest waste and resource management companies in the UK, we are well-placed to partner with local and national government to build the essential energy and waste infrastructure to boost economic productivity and resource efficiency. Brexit is a seminal moment for the UK, and we should have a waste and resource policy which reflects this. The role of government We are confident that our industry will prosper in a post-Brexit Great Britain, but feel our ambitions can only come to fruition if the Government uses this once-in-a-lifetime chance to create a smarter approach to managing our domestic waste. Given the potential size of the opportunity that lies ahead, I hope it is one they grasp with both hands.

The Government has specifically identified energy as a key part of its Industrial Strategy and it has highlighted resource productivity (i.e. reducing the amount that we spend on raw materials and waste management) as a central pillar of the plan. To realise this ambition, innovative thinking will be required around resource efficient energy creation, such as EfW. However, the reality is that the UK lacks an established market with EfW, which means that we are not making the best use of our resources. In fact, the reality is that we are shipping our waste to other European countries, where it is used to meet their domestic energy needs. Policy Exchange found that waste management companies spent £280 million exporting the UK’s waste to Europe in 2016, which other countries used to produce energy which heated homes and businesses. This is both counter-intuitive and unsustainable. The UK urgently needs increased investment in its own waste infrastructure, which will not only enable us to better manage the waste, but will also help to safeguard the UK’s long-term energy security.

An operative in the control room at Greatmoor EfW ensuring the fuel is mixed before processing

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THE PARLIAMENTARY REVIEW Highlighting best practice

Waltet Group

Dan Newbold and Mark Howard, co-founders of the Waltet Group T wenty-one years ago Mark Howard and Dan Newbold started the Southampton-based Waltet Group which has evolved into one of the most innovative and successful recycling companies in the south of England. When the company was formed, Waltet found its niche in tarmac road planings before evolving into the first-class waste recycling firm it is today – a diverse organisation, employing 120 people, offering a full range of commercial and domestic ethical waste disposal solutions, skips, recycled aggregates including tarmac planings and crushed concrete, graded top soils and transport services. What sets Waltet apart from others is the efficiency of its operations, years of experience, a team of well-trained dedicated staff, modern environmentally-friendly machinery and, importantly, state-of-the-art software applications enabling profits to be invested back into the business for future development. »» Waltet Recycling Ltd – recycles waste products »» Waltet Materials Ltd – sells the waste products and provides haulage services »» Hutchings & Carter Ltd – a construction company which consumes recycled materials This diversification has included construction projects covering highway and local authority schemes along with haulage services through the operation of a modern fleet of environmentally-friendly lorries. Driving this has been our evolution into a fully-fledged waste recycling specialist, operating across our sites in Hampshire through an impressive expansion programme which began in 2006. Through diversification, investment and acquisition the Waltet Group comprises:

Waltet provides a broad range of recycling services

FACTS ABOUT WALTET GROUP »» Formed in 1996 by Mark Howard and Dan Newbold »» Headquartered in Southampton with waste transfer facilities in Alton and Romsey »» Offers recycled products and waste solutions primarily for the construction and highways industry »» Acquired the first waste recycling centre, based in Romsey, in 2006 and the second, based in Alton, in 2011 »» Employs 120 staff »» Named by BDO as one of the Central South region’s top 20 mid-market companies of tomorrow »» Named by the London Stock Exchange as one of the 1,000 companies to inspire Britain (for the last two years)

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ENVIRONMENT

Mark Howard, Co-Managing Director of the Southampton-based company, says despite its growth through a diversification of services, UK waste recycling regulation has created a difficult environment that is posing conundrums for its many players. The role of landfill sites Despite best practice, only 85% of mixed waste can be recycled; the rest then goes to landfill for disposal. Government policy in this area is very firmly entrenched; landfills are no longer being advocated for the future. While this movement away from landfill sites may be environmentally sound, such policies could prove challenging for companies such as Waltet. An immediate consequence of this is that a number of landfill sites will be forced to close, including one very local to Waltet. This has also been compounded by legislative restriction and policy that have created barriers to recycling, increasing the pressure on landfill with materials that were previously recycled now being required to be sent to landfill. Our primary concern, and that of the wider industry, is that landfills are necessary because there isn’t

an alternative business which will deal with the 15% of mixed waste that cannot yet be recycled. There’s a disparity between the number of landfills and the reality of where this excess waste will go. To date, the Government hasn’t proposed a viable alternative to bridge this gap. In addition, many councils are seeking to close most of their landfill sites by 2020. This is no doubt the right thing to do but only when the UK has sufficient countrywide capabilities to process all the waste and hit much higher recycling rates. If European countries hit their 2020 ambition of overall recycling rates of 50%, where will the other 50% go? The UK’s restrictive recycling landscape The present environment does conjure up positives. There is plenty of opportunity for the likes of Waltet, as the UK’s awareness of the potential of refuse for fuelling purposes and other energy needs grows. In the past decade, the country has worked towards encouraging industrial businesses to use alternative energy sources to the more traditional methods of powering the UK’s power stations.

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There’s a disparity between the number of landfills and the reality of where this excess waste will go

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Waltet operates a modern fleet of environmentally-friendly vehicles

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THE PARLIAMENTARY REVIEW Highlighting best practice

Waltet’s transport fleet covers all needs

However, the UK finds itself at the tip of the recycling iceberg and recycled materials used for fuels will take time to become commonplace. In the meantime, companies like Waltet are proactively working to find innovative ways to recycle even more and make the most of the available opportunities. In some cases we’ve done this, yet the methods are often imperfect and costly to both the customer and ourselves. An example of this is how we dispose of waste wood. When we first set the business up in 1996, Waltet was being paid £15 per tonne for waste wood to supply to energy providers. The solution for waste wood disposal currently costs up to £50 per tonne due to UK laws restricting the burning of the material. Instead, it is shipped to the Continent and Scandinavia from Southampton Docks to be burnt for their energy needs. The high charges of this are passed on to the public, which in turn, means skip disposal fees are getting higher by the year. Other contentious issues, such as fly tipping, are also born out of this. A quick drive through the countryside clearly shows that fly tipping is on the increase. The clean up costs were recently reported to be over £49.8 million. Given the imperfect set of circumstances and what emanates from them, long-term, regulations around recycling and the future role of landfill sites aren’t viable. There is a collective industry fear about this

genuine problem and many firms are anxious to find some form of workable solution. After all, the waste industry employs many thousands of people of all abilities. Bullish about the future Throughout our history, the waste sector has undergone an amazing transformation, resulting in the highly- regulated and capital-intensive industry we see before us today. While certain regulations and scenarios are far from ideal, others have been very effective in elevating the industry standards and weeding out less professional businesses. Waltet remains extremely bullish about the prospects of the company’s waste division along with those of the wider industry, having successfully navigated its way through the volatility of recession. The strength of the company, with its multiple income streams, means the Waltet Group is set up for significant future growth. With no shortage of funds available, banks seem more willing to finance the waste sector – some of it at better rates since June 2016’s Brexit vote – and this in turn creates fresh work avenues for us. Construction work will play an integral part of Waltet’s future given the multitude of government-driven road infrastructure projects being undertaken and planned in the south of England.

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The strength of the company, with its multiple income streams, means the Waltet Group is set up for significant future growth

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18 | WALTET GROUP