May 24th, 2013

It’s not fair

7 minute read

by Chris Sherrington

 

As the father of two young children I am frequently reminded how early in life we develop a sense of what is fair, and (perhaps more intensely), what isn’t. One of my favourite methods of avoiding adjudicating on such matters is to step outside and busy myself with preparing materials for recycling. Given the nature of my work and my company’s culture, it will come as no surprise to hear that I am a pretty diligent recycler. Moreover, as far as I can, I try to prevent the generation of waste in the first place. The upshot is that the Sherrington family’s black bag waste is comprised almost entirely of plastic films and wraps.

However, a quick stroll down any residential street will soon confirm that households’ waste arisings and recycling performance are variable to say the least. When I ponder this situation, I confront the same sense of injustice felt by my children. My efforts to minimise waste and separate out recyclable materials bring environmental benefits – but also lead to financial savings for Bristol City Council. By contrast, the waste prevention and recycling actions (or more accurately inactions) of some of my fellow citizens don’t only represent missed opportunities to reduce environmental pressures, they impose an unnecessary burden on local authority finances.

What irks me is that I have to pay exactly the same amount through my Council Tax as those (in the same Council Tax band) who produce the greatest amount of waste, and fail even to separate out recyclable materials. It strikes me that this is neither fair, nor sensible. Environmental benefits aside, it is in the financial interest of local authorities to reduce waste arisings, unless like Stoke on Trent they are tied in to a put-or-pay incinerator contract. It would seem appropriate, therefore, to align the interests of individual households with those of their council.

 

Getting the incentives right

Imagine if every household paid a fixed monthly charge for electricity, regardless of the amount used. What would the rational response be? Faced with a marginal cost of consumption of zero, it’s pretty clear that usage would be higher than at present. Then consider how difficult it might be, under such circumstances, to encourage people to consume less electricity!

This is precisely the challenge facing local authorities in trying to encourage householders to prevent waste, and indeed to recycle. The same difficulty afflicts attempts to encourage water conservation, but whilst water metering is still far from universal, at least in that context the argument has been won, and meters are gradually being rolled out.

There is a strong case that ‘metering’ waste can be effective in changing behaviour. In a 2011 study, Eunomia reviewed the evidence in respect of the waste prevention effects of a range of interventions. The most compelling evidence of waste prevention effects came from Direct and Variable Rate (DVR) Charging, also known as Pay As You Throw (PAYT). Such schemes vary, both in how much is charged, and the basis of calculation – by weight, volume, sack and/or frequency. Typically, the highest charge is for residual waste, with recyclables costing less. The most effective schemes in the case studies that we reviewed led to a fall of 10% or more in the quantity of household waste collected.

Importantly, a comprehensive PAYT scheme provides a direct financial rationale for households not just to recycle, but to engage in waste prevention, perhaps by choosing reusable nappies, choosing goods with less packaging or by home composting (although the latter is not always considered to be prevention).

 

Electricity Meter

Pleased to meter you: we accept that many services should be metered, so why not waste? Photo by Mike1024, via Wikimedia Commons

For the local authority, a well-designed PAYT scheme can save money in two ways. Any waste prevented or moved from disposal to recycling will reduce treatment costs – although it may actually increase the cost per tonne of collection. Refuse trucks will still have to drive by and pick up from every household just as often, and the additional recycling collections will require extra vehicles and crew. However, further savings can be made if a frequency-based element is included in the charge, so that householders can limit their expenditure by reducing the frequency of collection for some streams. This would be likely to cut the number of collection vehicles the council needed, and hence its costs.

PAYT can therefore bring the interests of householders, councils and the environment into line, and to me it seems intuitively fair. You pay for the service that you use. In the absence of PAYT, the marginal cost of waste generation is zero. Apart from those like me who would do it anyway, how else would households be motivated to reduce their waste?

 

Preventing waste prevention

So when Eunomia recently developed a waste avoidance toolkit for local authorities, you might have expected the list of measures for which it outlines the expected costs and benefits not only to include support for reusable nappies, community swap days, zero waste challenges and so forth, but also PAYT schemes. However, PAYT was notable by its absence because, to cries of approval from the Daily Mail, the Localism Act 2011 explicitly forbade local authorities in England from introducing it, despite its demonstrable waste prevention effect.

It is interesting how coy Defra has been about the position on PAYT in its recent call for evidence on a Waste Prevention Programme for England. There are evident difficulties in measuring waste prevention, and proxy indicators are needed to assess the effectiveness of actions taken. As I read through, I was intrigued to see, among the possible metrics from a list suggested by the European Commission against which performance could be measured, the following:

  • “Percentage of citizens covered by a pay-as-you-throw scheme”

 

Defra’s comment in response was:

  • “No citizens are covered by a PAYT scheme. If they were implemented by local councils this would be measurable”

 

No mention of the fact that any council implementing such a scheme would be measurably in breach of the law! To my mind this ban on the use of an effective waste prevention measure sits uncomfortably with the requirement to respect the waste hierarchy. Pity the poor local authority waste prevention officer, who is currently armed only with anti-junk mail stickers, promotional literature for paint reuse schemes, and Love Food Hate Waste tea-towels. Without PAYT, the effectiveness of any waste prevention strategy will be significantly constrained and the cost-effectiveness of other measures will be greatly reduced. We will be stuck with the current inefficient and inequitable approach.

 

A fair target?

It rather surprises me that the Daily Mail is not campaigning for PAYT. It would seem to appeal to their sense that the efforts of the diligent and hard-working should not be squandered by profligate local authorities, and that taxpayers’ contributions should be spent wisely, rather than used to subsidise the antisocial and idle.

I am happy to pay my fair share of tax, but when it comes to recycling and waste, I feel it is unfair that I am expected to subsidise those in my community who don’t make the effort.

Instead, the Daily Mail is dead set against PAYT, and bizarrely even the Taxpayers Alliance opposes any form of charging for waste collection, although it could be expected to result in lower costs to taxpayers overall. What is it about waste that makes it an exception? The Daily Mail doesn’t argue for the universal reinstatement of water rates!

It seems to me that the current flat rate charging system engenders a sense of entitlement, and an expectation that ‘having paid for it’ householders should cheerfully use the service to their hearts’ content. To the household, the marginal cost of waste generation truly is zero, while for the local authority this is far from true. Creating a link that aligns their interests would bring the consequences of an individual’s behaviour more closely into focus.

The development of personal responsibility for one’s actions, and an appreciation of their consequences, is something that we encourage our children to learn as they grow. I don’t think it’s too much to ask that as adults, we should practise what we preach. In fact, I think that would be fair.

 

Chris Sherrington

 

Dr Chris Sherrington Senior Consultant

 

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Chris Sherrington
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Chris Sherrington

In its waste strategy survey Cardiff City Council is looking for views on whether to lobby government for the power to introduce PAYT http://www.cardiff.gov.uk/content.asp?nav=2870,4049&parent_directory_id=2865&id=14616&feature

Chris Newton
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Chris Newton

People being handed responsibility for waste can only be a good thing. If we accept this how to we achieve it? Councils do not have the will, ability or incentive to make PAYT a reality. However with large investment needed in the waste sector and government unable / unwilling to provide, how to we get the desired result? What if we take responsibility for waste collection away from councils and put it on to individual households. No longer would councils operate waste collections and we would all see a reduction in our council tax bills. Households would then have an… Read more »

Chris Sherrington
Member
Chris Sherrington

Hi Chris Interesting idea, and effectively what happens in Ireland. However, as pointed out by Eunomia in a review for the Irish Government, a situation where several companies operate the same route for collection is not an efficient outcome for the delivery of household waste collection services. If there is genuine competition, then the reduced density of logistics is likely to increase costs rather than reduce them. A more appropriate approach would be to have competition for the market rather than within the market. While this increase in collection costs – presumably passed through to charges faced by the household… Read more »

Chris Newton
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Chris Newton

If the cost of waste collection for the individual goes up then good! Surely this is what we want – I may be being naive here but the more it cost to dispose of waste then the less will be created. If we then look at recycling separately then by releasing market forces you would allow smaller players to enter the game and as the waste infrastructure (MRF’s, MBT, AD’s etc) is now quite developed and getting more so there will be genuine competition for the recyclate collected by small contractors which can offer a regularity of supply. In the… Read more »

Peter Jones
Member

I see where you’re coming from, Chris – perhaps paying more for waste collection would make people give the subject greater thought. However, I fear that in practice, competition within the market would have undesirable effects. It would make the domestic market work more like the commercial waste market, with services like food waste collections being uneconomic for many low volume producers to choose to buy. You may find the argument here interesting: http://www.isonomia.co.uk/?p=1367 It’s all about how competition for the market brings down collection costs and makes it economically viable to recycle more different streams, which are not practicable… Read more »

Chris Newton
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Chris Newton

Very interesting and I can’t say I disagree; we have been looking at collectivisation for business waste collection in the marches (Hereford way) and think it has great potential, as you have shown with your examples from London’s BID areas. You do ask the question – The big problem is how to make it happen? For me at the moment a large amount of business and household simply do not have a large interest in waste management so as long as waste collection is affordable these solutions will take a time to disseminate through the country/world. By increasing the cost… Read more »

Victor Buchanan
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Victor Buchanan

Completely agree with you Chris BUT when a pay as you throw trial was attempted a few years ago in Ireland the incidence of home incineration went up the chimney and through the roof. Burning waste in a domestic fireplace is obviously not a good idea. The notion that all citizens will conform for the common good NEVER happens in practice – except they tell me in North Korea (Source: Govt of North Korea)

Chris Sherrington
Member
Chris Sherrington

Hi Victor The system in Ireland at the time was very different to that which we have in the UK at present. According to the EPA report on the matter, 21% of households, typically those in rural areas had no form of waste collection, and it was these households where backyard burning was typical. Reported increases in backyard burning (the report doesn’t say by how much) were linked anecdotally to increases in household charges. While it seems plausible, there is no firm data to substantiate it. If you look at the size of the monthly sums that would be involved… Read more »

James Casey
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James Casey

It would be very interesting to see what impact such an initiative would have upon retailers, and whether the greater incentive upon individuals to reduce waste translated into shunning products or even companies that forced the most waste on consumers – thus forcing retailers in turn to redesign products to make them more attractive in such a climate.

Chris Sherrington
Member
Chris Sherrington

Hi James
I’ve not come across any evidence of this, but I would imagine that it might have an effect. I could certainly see people removing what they see as excess packaging at the checkout and leaving it for the supermarket to deal with.
Chris

H Cullen-Jones
Guest
H Cullen-Jones

A bonus for lower usage might play better with the general public and not incite more fly tipping?

Chris Sherrington
Member
Chris Sherrington

That’s an interesting idea. Do you effectively mean having a higher flat rate to start with and then a rebate at the end of the year? It would certainly sound more like carrots than sticks, albeit it would provide an upper limit on what households would pay, so those who discard the highest amounts would not pay their fare share. Also, it could be seen as a whacking great stick for all through higher council tax payments, with rebates only coming towards the end of the financial year, or perhaps after. This might cause a few cash flow issues –… Read more »