Clause 5 - Alteration of allocations under section 4

Waste and Emissions Trading Bill [Lords] – in a Public Bill Committee at 4:00 pm on 3rd April 2003.

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Photo of John Hayes John Hayes Shadow Minister (Environment, Food and Rural Affairs) 4:00 pm, 3rd April 2003

I beg to move amendment No. 37, in

clause 5, page 4, line 4, after 'may', insert

'with the agreement of the relevant waste disposal authorities'.

I have been trying to acquaint myself with the regulatory impact assessment before speaking to the amendment. As that is a rather long document, you will understand my slight hesitation, Miss Begg, before rising to my feet.

In a sense, the amendment follows from previous discussions. The point has been well made in the Committee that much of the Government's work on the Bill will be dependent upon a collaborative and co-operative partnership arrangement with the relevant authorities. We talked at length in the helpful discussion on the previous amendment, tabled by my hon. Friend the Member for Leominster, about the relationship between collection and disposal authorities. We also touched on the relationship between disposal authorities and Government, which the amendment draws into sharp focus. It refers to agreement with the relevant waste disposal authorities in respect of clause 5. It is vital that we understand how dependent we are on co-operation in the change of culture, which the Minister so appositely described, to achieve the ambitious targets in the proposal.

As we said earlier, we are anxious for maximum co-operation, consultation and agreement with the relevant parties. In that respect, it is important to recognise that there will be real concerns about the new targets. There will certainly be worries about the financial aspects and I hope that we will have time to explore such matters more fully later in the Bill when we discuss its trading and financial implications and some of the resource issues.

The Bill must reassure the disposal authorities, and through them the collection authorities, and all the parties who are critical to the proper working of the arrangement, that we are interested in their views and want their agreement. We want to consult them and to work with them to achieve the targets, and the amendment goes some way to achieving what we want in the right kind of spirit. I hope that the Minister will not demur too much from what we want to achieve and that he will accept the amendment on that basis.

Photo of Norman Baker Norman Baker Liberal Democrat, Lewes

I shall be brief. I ask the Minister to reflect on subsection (1) and to say why the Government believe that the allocating authority that has the power to make an allocation under subsection (4) should have the power at any time to alter the allocation. The proposal seems to give a draconian power to take such decisions, which will have a knock-on effect on disposal authorities and others. We want to have time to plan for and to accommodate such a measure. That is not in any way to resist the right of

the allocating authority to alter the allocation, but merely to say that there should be some planning. The amendment provides that if such an alteration were to be made, there should be an agreement or a consultation process so that the disposal authority has the opportunity to explain the implications to the allocating authority, and to ensure that such knowledge is taken into account in taking what may be a far-reaching, forward decision.

Photo of Michael Meacher Michael Meacher Minister (Department for Environment, Food and Rural Affairs) (Environment)

I have much sympathy with the amendment and I will try to explain the circumstances in which we believe it is right to keep open the power to alter the allowances, although I expect them to be few. The amendment relates to the alteration of landfill allowances and would force allocating authorities to secure the agreement of the relevant waste disposal authority before making changes to any allocation that had already been made.

We do not want to discourage local authorities from making long-term plans because they have concerns about possible changes to their allocations. That is not what we intend—quite the opposite. Clause 5(3) makes it clear that allowances cannot be withdrawn once they have been utilised. It is important that that is made explicit.

Although I cannot speak for the other allocating authorities, I assure the Committee that it is our intention in England to issue each waste disposal authority with its allocation of allowances for each year up to 2020 at the beginning of the scheme. Therefore all waste disposal authorities will know what their allowances are from the first year of the scheme, through to 2020—the final year, if we take advantage of the full derogation in the directive. If we do not, that is one example when we may make use of this provision. I can give an assurance that that will happen only after proper consultation.

The hon. Member for Lewes pressed me for other examples where this power might be used. One example where it might be necessary to alter the allowances set from the beginning of the scheme would be if the European Community made changes to the targets within the landfill directive. That is extremely unlikely; but any legislative body has the right and the power to alter its own legislation. However, in the case of the EU it is dependent upon the agreement, with qualified majority voting of the member states. I think that that is an extremely unlikely eventuality, although the possibility is not totally negligible.

Photo of John Hayes John Hayes Shadow Minister (Environment, Food and Rural Affairs) 4:15 pm, 3rd April 2003

The Minister has made a good point about the unlikely nature of those eventualities. He has also acknowledged my concern about the uncertainty of the disposal authorities, and the effect that that might have on their willingness to make the plans. If that tone could be repeated in some form of published guidance to local authorities, some of that uncertainty might be dissipated.

Photo of Michael Meacher Michael Meacher Minister (Department for Environment, Food and Rural Affairs) (Environment)

I am happy to accept that. It is important that we enable waste disposal authorities to understand, in preparing their long-term plans—which

we are keen that they do—that as long as they meet the targets, and are not going to exceed the amount sent to landfill beyond their allocations, their position will be as secure as we can possibly make it. It is not set in stone, and we would have to draft the guidance carefully to suggest that it is possible to envisage circumstances in which some change might be required, but we regard those as exceptional. That should not deter authorities from the main purpose, which is to build a carefully prepared long-term plan.

Photo of Alan Whitehead Alan Whitehead Labour, Southampton, Test

May I press my right hon. Friend, given his welcome intention to provide waste disposal authorities with their allocations at the beginning of the scheme over a long period? That is important for stability, forward planning and knowledge of what is to come. However, I have mentioned that a number of waste disposal authorities are already, at the start of the scheme, in consortiums. They already have long-term plans—in many instances they are halfway through their operation. They have perhaps made a contract for 25 years. They are effectively operating as one waste disposal authority. Is it my right hon. Friend's intention to make the allocations favourable towards those consortiums, so that they can make sense of those allocations in the light of their joint operations? They should not reach the situation, which I accept is probably hypothetical, whereby there is either insider trading as a result of the allocations, or fisticuffs between members of consortiums who were previously in harmony with one another.

Photo of Michael Meacher Michael Meacher Minister (Department for Environment, Food and Rural Affairs) (Environment)

My hon. Friend raises a genuine issue, and I apologise for not responding to him in the previous debate. I shall try to do so now.

Allowances are allocated to individual waste disposal authorities. However, as my hon. Friend said, some consortiums of local authorities have agreed to work together, and have embarked on a process of mutual operation that will run for many years. That is certainly the situation in Manchester, which is part of the area that I represent. If they want to work together, there is nothing to stop them agreeing to transfer allowances between them. I prefer to use the phrase ''internal trading'' rather than ''insider trading'', which has different connotations. Internal trading between them is perfectly permitted under the Bill, as long as it is not on the basis of money. I shall return to that issue later. As long as the targets are met, the objective is to make it compatible with existing arrangements, not to stymie existing arrangements that operate perfectly well.

If the targets in the directive were changed, we would need the ability to alter all waste disposal authorities' targets. It would be an enormous, if not virtually impossible task, to achieve that by agreement, which is what the amendment suggests.

That would put the UK at risk of not meeting its obligations, and therefore of incurring European Court of Justice fines, which I am sure those who tabled the amendment want to avoid.

I assure the Committee that alterations to allocations in England will be made only in exceptional circumstances.

Photo of Norman Baker Norman Baker Liberal Democrat, Lewes

Will the right hon. Gentleman give way?

Photo of Michael Meacher Michael Meacher Minister (Department for Environment, Food and Rural Affairs) (Environment)

I was just about to reach my peroration, but I shall give way to the hon. Gentleman.

Photo of Norman Baker Norman Baker Liberal Democrat, Lewes

That is why I intervened when I did: I wanted to make another point before the Minister finished his peroration.

The clause talks about an authority making an allocation, which necessarily relates to one part of the United Kingdom rather than all of it. The Secretary of State is not involved in this particular case. The Minister explained that a change might be necessary because of changes in EU legislation, yet there seems to be no provision to ensure that if one authority changes its allocation, the other authorities have to follow suit. Does the Minister envisage a situation in which there may be a change in England, but not in Scotland, Wales or Northern Ireland?

Photo of Michael Meacher Michael Meacher Minister (Department for Environment, Food and Rural Affairs) (Environment)

It is possible to envisage such a circumstance, although what would cause such an unlikely change in England is likely also to apply to Scotland and Wales. However, I would not like to say point blank that there could be no such circumstances. I repeat that we are talking about circumstances that are very unlikely to arise. Governments often have to keep options open that they do not expect to use. I sometimes cannot see more than a week ahead, if that. Goodness only knows where we shall be in 20 years' time. We should have the flexibility, while giving every assurance to local authorities that we have no intention of messing around with their long-term plans or of intervening in any other way. I say that to the hon. Member for South Holland and The Deepings, who made a very fair point. The power is a power of last resort in case circumstances arise over which we have no control. We should make that clear.

Photo of Mr Jonathan Sayeed Mr Jonathan Sayeed Conservative, Mid Bedfordshire

I am glad to hear the Minister give my hon. Friend the Member for South Holland and The Deepings that assurance, because as the principal duty for implementing the landfill directive is imposed on the UK Government, as the fines will be for not implementing it, it does not make much sense to give waste disposal authorities a power of veto over what the UK Government can or cannot do. I have one question for the Minister: what is the position of a waste disposal authority that crosses a transnational boundary, for instance, between Scotland and England, and England and Wales? In the case of the England and Wales borders, although I am not sure about the Scottish borders, I thought that there were at least one or two cases where a disposal authority went over a transnational border. If that is the case, it could lead to conflict on such an occasion.

Photo of Michael Meacher Michael Meacher Minister (Department for Environment, Food and Rural Affairs) (Environment)

I am very glad that I have just been advised that there is no option for straddling because I agree that, if it were allowed, it might cause one or other devolved Administration, or England, to miss out in exceptional circumstances. Therefore it is not permitted. On that basis—reaching for my peroration for a third time, so it will fall very flat—I hope that the hon. Member for South Holland and The Deepings

will feel satisfied that he has secured the purpose of his amendment and will not press it to a vote.

Photo of John Hayes John Hayes Shadow Minister (Environment, Food and Rural Affairs)

The Minister has given an assurance that he has taken on board the argument, which found support around the Committee, that the guidance issued to local authorities should provide the assurance that we request. He has also taken on board the argument that the guidance should repeat the notion that the provisions relate to exceptional circumstances—I accept his argument that the wording would have to be carefully considered—as it were, a long-stop provision in the Bill, given circumstances that cannot reasonably be foreseen at the moment. Given those assurances, I am happy to withdraw my amendment so that the Minister will not be forced to extend his oratorical powers any further and think of yet a fourth peroration.

Amendment, by leave, withdrawn.

Clause 5 agreed to.