The Budget 2015, released by the Chancellor of the Exchequer George Osborne this afternoon (18 March), reveals that government will provide an extra £4.2 million to tackle waste crime, reform the Landfill Communities Fund, and introduce a raft of initiatives to “put Britain at the forefront of the online sharing economy”.

Waste-related actions

Though there is little new for the waste and resources industry in the Budget, the government has announced that, for the second year in a row, it will provide a ‘one-off £4.2m increase in Environment Agency (EA) funding to address waste crime’. This funding builds on the £5-million awarded to the EA last year, and will come from ‘savings from the Landfill Communities Fund’ (LCF) for 2015/16.

The value of the LCF for 2015/16 will be set at £59.4 million, with the cap on contributions by landfill operators amended to 5.7 per cent. This reflects the devolution of landfill tax to Scotland from 1 April 2015 and the ‘ongoing high levels of unspent LCF funds’.

The government is also now consulting on a package of measures to reform the LCF, developed by a government-sector working group. The package is intended to accelerate the spending of funds on community projects, reduce administrative costs and simplify administrative processes.

The reforms proposed, which are open for consultation until 10 June, include:

• placing an 18-month spending requirement on an organisation’s ability to fund or complete projects using LCF funds;
• reducing a landfill operator’s entitlement to a tax credit in line with the amount of any unspent funds held;
• introducing a 7.5 per cent cap on administrative costs of unspent LCF funds;
• introducing a licensing requirement for environmental bodies that receive contributions directly from a landfill operator; and
• requiring environmental bodies to monitor and keep records on assets purchased through LCF funding ‘in perpetuity’.

The Budget also confirms that the aggregates levy rate will remain at £2 per tonne in 2015/16, and the government will introduce an 80 per cent levy credit for aggregate commercially exploited in Northern Ireland between 1 April 2004 and 30 November 2010 following its importation from another EU member state.

As announced in the Finance Bill, the standard and lower rates of landfill tax will increase in line with RPI, rounded to the nearest five pence, from April 2016 and it was reiterated that the loss on ignition testing regime, announced in the Autumn Statement 2014, will be introduced from 1 April 2015.

Sharing economy

Announcing the Budget this afternoon, Osborne touched on the UK’s role in the sharing economy, stating: “[S]ince we aim to be the most prosperous major economy in the coming generation, then we must support the latest insurgent industries too. So we take steps to put Britain at the forefront of the online sharing economy.”

To do this, government is proposing ‘a comprehensive package of measures that will break down barriers, create opportunities for sharing, and unlock the potential of this dynamic and growing area’. These include:

• launching two pilots in Leeds and Greater Manchester in 2015/16, to trial local sharing initiatives in the areas of shared transport, shared public space, and health and social care;
• along with the Local Government Association and partner organisations in Scotland, Northern Ireland and Wales, exploring the extension of a national platform to advertise spare central and local government space to businesses, individuals and community groups, where appropriate;
• making it easier for individuals to sub-let a room by legislating to prevent the use of clauses in private fixed-term residential tenancy agreements that expressly rule out sub-letting or otherwise sharing space on a short-term basis;
• updating planning guidance to local authorities to clarify that it should be possible for non-residential properties to rent out their existing parking spaces without requiring planning permission, ‘provided there are no substantive planning concerns’;
• updating guidance to Job Centre Plus staff by autumn 2015 to ask them to ‘signpost job-seekers to time bank and task-sharing opportunities where appropriate, working with Sharing Economy UK [a new trade body], to help job-seekers boost their skills, experience and income’;
• enabling government employees to use sharing economy solutions to book accommodation and transport when travelling on official business, where this represents value for money;
• encouraging local authorities to use their business rates discretionary relief powers to support the sharing economy, including shared workspaces and maketspaces;
• engaging with the Start Up Loans Company about actively promoting the use of task-sharing sites to assist in starting a business;
• engaging with the New Enterprise Allowance programme so that work coaches will, where appropriate, ‘signpost claimants to task-sharing options, working with the Sharing Economy UK trade body, if they are setting up a business or want to develop an existing business’; and
• digitalising criminal record checks and integrating them into third-party services including, as appropriate, sharing economy platforms, through an application programming interface.

The Budget also mentions that the Leeds Enterprise Zone will be changed to support energy and waste technology businesses.

Although the Chancellor mentioned that government “back[s] oil and gas and we back our heavy industry too, like steel and paper mills”, there is no mention of how the government will ‘back’ the paper industry (especially following the closure of one of the UK’s three main newsprint mills, Aylesford Newsprint), other than aiming to halt the shift to digital news consumption by consulting on whether to introduce a business tax relief for local newspapers in England.

Industry reaction

Several commentators have already issued reactions to today’s Budget statement, with Dan Cooke, Director of External Affairs at waste management company Viridor, saying: "Britain urgently needs to resource the fight against rising waste crime which threatens the sector’s development and our economic and environmental interests. Today’s announcement of a one-off increase in Environment Agency funding to crack down on waste criminals is therefore welcome indeed. But waste crime isn’t a one-off quick win and needs sustained support and resourcing.

“With the sector at a point of inflexion, the Budget was a missed opportunity to support the next wave of infrastructure investment needed to create 50,000 new jobs, deliver resources for UK manufacturing, enhance UK resource and energy security and skill a new generation of engineers and scientists.”

The Chief Executive of the Chartered Institution of Wastes Management (CIWM), Steve Lee, also welcomed the waste crime funding, but said it was "disappointing that the government did not take up the recommendation of the Communities and Local Government (CLG) Committee to set aside a proportion of any increase in tobacco levies to help local councils pay for the clean-up of cigarette related litter".

He added: "This would have sent a strong signal that the Government is committed to supporting local government in its efforts to maintain local environmental quality in times of constrained budgets."

Others voiced their disappointment at the lack of green intiatives, with the Chief Executive of environmental charity WWF-UK, David Nussbaum, saying: “Opportunity knocked but the Chancellor only partially opened the door to greener, smarter growth.

“The Chancellor could have created jobs and boosted growth through long-term incentives for clean technologies. Giving the Green Investment Bank access to private capital would help more enterprises prosper. And reasserting the role of the Natural Capital Committee would ensure more prudent management of the natural resources on which our economy depends.

“With the threat posed by climate change and environmental degradation, we face a global challenge that our political leaders must address head on. As we approach the general election all parties should put green economics front and centre of their manifestos.”

However, Sam Corp, Head of Regulation at the Environmental Services Association (ESA), welcomed the confirmation of the LOI testing regime, commenting: “ESA and its members have been working closely with HMRC and Treasury officials over the last two years to develop the testing regime.

“An objective LOI test will go a long way to prevent the misclassification of waste which has been so costly to responsible operators and to the UK’s economy.

“We hope that the Chancellor’s announcement will give operators the assurance they need to put in place the necessary measures to implement the regime from 1 April.”

Read the full Budget 2015 document or find out more about the LCF consultation.