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This publication is available at https://www.gov.uk/government/consultations/reducing-crime-at-sites-handling-waste-and-introducing-fixed-penalties-for-waste-duty-of-care/outcome/government-response
1. Executive summary
On 15 January 2018, Defra and the Welsh Government published a consultation on “Proposals to tackle crime and poor performance in the waste sector & introduce a new fixed penalty for the waste duty of care”. This looked at raising the standard of operator competence at permitted waste sites, reforming the waste permitting exemptions regime to avoid misuse, and introducing a fixed penalty notice for breaches of the household waste duty of care. The summary of responses was published on 3 July 2018. This document sets out the approach we are taking based on the findings of the consultation.
On operator competence we intend to amend the Environmental Permitting (England and Wales) Regulations 2016 to require all regulated facilities that undertake waste operations to be managed and operated in accordance with a written management system, which identifies and minimises the risks of pollution arising from the waste operation. We also intend to introduce an amendment in the waste returns so waste operators must notify the regulators of their Technical Competence Management arrangements at their waste site. This will be done through legislation in England and Wales later this year.
We also intend to amend the Environmental Permitting Core Guidance to widen the scope of offences, behaviour and relevant persons that the regulator can take account of when assessing competence. These changes will be reflected in more detail in guidance used by the Regulators.
We intend to introduce further legislation next year which will clarify the legal requirement for technical competence and introduce a de-registration system for technical competence. We will also consult on specific financial provision options in 2019, with the aim to include that in the same legislation.
Based on the detailed responses received, we are continuing to consider the precise technical changes to exemptions requirements proposed in the original consultation. The consultation reinforced the clear need to reform the 10 most problematic exemptions in order to prevent their use to cover illegal activity. However, this needs to be done in a way that does not overly impact legitimate activities. A supplementary government response setting out our approach to exemptions will be published in due course.
Finally, we will be introducing the proposed fixed penalty notice (FPN) for breaches of the household waste duty of care. This will be done through legislation in England this year and in Wales early next year. The FPN will provide authorities with an alternative enforcement option to prosecuting offenders through the courts.
We also issued a supplementary consultation on updating the Waste Duty of Care Code of Practice to provide more detail on meeting the household waste duty of care, and new guidance for local authorities in England on use of the FPN. The code of practice and guidance have been further amended based on responses received. They will be published alongside this government response. Guidance for local authorities in Wales will be published early in 2019 once the regulations come into force.
This document sets out the UK and Welsh Governments’ response to the consultation on “Proposals to tackle crime and poor performance in the waste sector & introduce a new fixed penalty for the waste duty of care”.
This consultation was held between 15 January and 26 March 2018, and the summary of responses published on 3 July 2018.
The consultation sought views on:
- A: raising the standard of operator competence across all permitted waste sites by strengthening the regulator’ assessment and enforcement abilities
- B: reforming the exemptions element within the waste permitting regime
- C: introducing a Fixed Penalty Notice for household waste Duty of Care offences
The government response is split into the same three separate sections which can be read independently of each other.
A supplementary consultation on new guidance for local authorities in England and updates to the Waste Duty of Care Code of Practice to reflect the proposed introduction of the FPN was launched on 3 July and closed on 27 August 2018. The summary of responses to that supplementary consultation is available on the consultation page. Part C of this Government Response also responds to that consultation as part of setting out our approach to the FPN. A separate process for developing local authority guidance was undertaken in Wales.
3. Part A: Raising the standard of operator competence at permitted waste sites
Part A sought views on proposals to strengthen the regulators’ assessment and enforcement of operator competence in order to raise the standard of competence across all waste operations permitted under the Environmental Permitting (England and Wales) Regulations 2016 (the EPRs).
The EPRs ensure that waste operators are authorised (permitted) following assessment by the Environment Agency or Natural Resources Wales. Waste operators are thereafter regulated by the agencies to ensure they continue to follow the conditions of their permits which are set in line with the EPRs and core guidance. The permitting regime is the framework to reduce environmental impact in the locality of waste sites, ensure safe operations and minimise risk of pollution. The Environmental Permitting Core Guidance explains how the EPRs should be applied in practice and Chapter 9 of the guidance sets out the scope and application of operator competence.
Leading to, and confirmed by, Defra’s call for evidence in 2015 were concerns from the waste industry and regulators that a lack of operational competence is causing poor performance across the waste sector. This lack of competence relates to the inability to comply with permits and to run a waste site effectively.
Poor performance in the sector leads to negative impact on the environment and local communities. Reduced competence and poor performance can also lead to waste sites being abandoned leaving the government to clear waste, ultimately a burden on taxpayers. The most effective way to tackle this is by regulator intervention at the permit application stage. This will ensure that appropriate levels of competence are demonstrated before a permit can be granted.
We proposed to make improvements to each of the four elements of operator competence outlined in the Core Guidance:
- past operator performance – we proposed to widen the scope of offences, behaviour and relevant persons that the regulator can take account of when assessing competence.
- management systems – we proposed to require all permitted waste operators to manage and operate in accordance with a written management system.
- technical competence – we proposed requiring all permitted waste operators to demonstrate appropriate technical knowledge of their waste site and provide details of the Technically Competent Manager.
- financial competence and provision – we proposed to require the operator of any permitted site to be financially capable of running their waste business and provide financial security.
3.1 Past performance
Part A questions 1-6 sought views on proposals to raise the standard of operator competence across the waste sector in England and Wales by strengthening the regulators’ assessment and enforcement capabilities when considering the history of a waste operator. This includes changes to four areas of guidance which regulators adhere to when considering permit applications and variations:
- relevant person definitions
- relevant offences committed by permit applicants
- treatment of corporate bodies
- poor behaviour by waste operators towards the regulators and the permitting process
By adding to regulatory powers in these areas we will help ensure that only waste operators with a good attitude to compliance are granted permits, raising overall standards, reducing non-compliance and waste crime.
As set out in the summary of responses, there was strong support for all proposals from respondents, including professional bodies, businesses, trade associations, private individuals and others. The responses show overwhelming support for the majority of our past performance proposals. All questions seeking views on proposals relating to waste operator past performance assessment received over 90% support except for one which concerned the treatment of corporate bodies by regulators and was supported by 75% of respondents.
Respondents recognised that the profile of waste criminals can reflect wide ranging aspects of criminality. Adding to the legislation under which operators need to disclose offences for regulatory consideration will help address this. This will lead to a reduction in people with criminal intentions entering the waste sector and the core guidance will be amended to make it clearer where the Rehabilitation of Offenders Act allows regulators to take spent offences into account when making permitting decisions. Informed by the comments received, we have included further suggestions regarding relevant offences. We will insert a list of legislation into the Core Guidance under which permit applicants must disclose non-spent offences. The list will include the five Acts set out in the consultation (Customs and Excise Management Act 1979, Fraud Act 2006, Proceeds of Crime Act 2002, Scrap Metal Dealers Act 2013 and Theft Act 1968). Further legislation under which relevant offences must be disclosed will be added to the list following consideration of the additional proposals received. The Core Guidance currently states that a relevant offence must relate to the environment or to a person’s conduct as the operator of a waste facility. In relation to some specific offences, we believe that even if they were not strictly related to the environment, those offences may be indicative of wider criminality that may suggest that the relevant person should not hold an environmental permit. We will also clarify that regulators may consider offences under Scottish and Northern Irish legislation, recognising that waste criminals sometimes move between areas. This will assist the regulatory agencies to stop those with criminal intentions gaining permits in England and Wales.
We will ensure the list of relevant persons in the guidance is more reflective of how the regulators’ powers can be used. We will enable the regulators to consider offences by corporate bodies that have resulted in a criminal conviction when considering the issue, transfer or variation of a permit. We will also amend the Core Guidance to make it clearer that the regulators are able to take into account an operator’s poor behaviour when assessing past performance.
We will now amend the Environmental Permitting Core Guidance to further clarify what the regulators may do under the EPRs, along with additional changes following the comments and suggestions by respondents. These changes will become immediately applicable upon being published in early 2019.
3.2 Management systems
Part A question 7 asked about the benefits of requiring all waste permit holders to operate in accordance with a written management system. This means a document that identifies and minimises risks of pollution which could arise as a result of operations including maintenance, incidents, non-conformance and closure. It should also include any risks at the site drawn to attention by complaints from the community. Written management systems are a standard feature of all post 2008 permits and those that have since been varied to include the condition but that leaves over 2,000 operating without the condition. Ensuring that all operators have a management system in place will help to raise operational standards and deliver the step change in waste sector performance that is required. EPR Core guidance makes it clear that operators should have effective management systems in place which includes all permitted activities. By enshrining this in law we will enable regulators to hold operators to account by enforcement action when they do not hold or produce a written management system or when they fail to operate in accordance with written principles.
96% of respondents agreed that this would be a positive step towards improving operator competence in the waste sector. As set out in the summary of responses, respondents agreed that ensuring all permit holders operate in accordance with a written management system will deliver greater environmental protection and provide a level playing field across the waste sector. Some businesses expressed concerns that the requirement to hold a modern management system itself did not guarantee compliance. While this may be true the government is clear that arming regulators with greater enforcement capability will raise standards across the sector and introduce the level playing field that is fair to all operators. Compliant operators with newer permits and the right attitudes will no longer be disadvantaged. Currently in the absence of the management system condition the regulator is unable to assess for poor site management unless another condition is breached. By introducing the requirement as a condition on all permitted waste sites the level playing field is achieved and operator competence standards are universally raised.
Some respondents set out a preference for the regulators to address the disparity in pre and post 2008 permits with regards to management system conditions by reviewing and updating all permits without it. The government has taken the decision with consideration to available resources that the best way to ensure that the condition applies to all waste permits is by amending the legislation that imposes standards for waste operators.
Producing a written a management system should not be a significant burden on operators. As core guidance sets out, the content and detail of the management system should be proportionate to the operations at the site it applies to. The government has consulted regulators and determined that three months should be sufficient time for competent operators to prepare a written management system in accordance with the law.
3.3 Technical competence
Questions 8 - 10 asked views on proposals to strengthen the regulators’ assessment and enforcement of technical competence for permitted waste sites. Appropriate standards of technical competence across the waste sector are essential to ensure that waste sites are being operated in a way that does not result in poor performance. There is, however, a significant gap in the level of technical competence in the waste sector. The consultation set out three proposals to raise the standard of technical competence at permitted waste sites. These were:
- clarifying the legal requirement for technical competence
- notifying the regulators of the technical competence at a site
- action against technically competent managers (TCMs) acting improperly
As set out in the summary of responses, there was broad support for all three proposals. Respondents though that clarifying the legal requirement for technical competence would increase the levels of technical competence in the sector. They also raised that a transition period would be required and the requirement should be enforced. We are in are in agreement that there should be a suitable period of time before the legislation comes into force to give waste operators time to obtain the relevant technical competence qualifications. Once the regulations comes into force, it would give the regulators powers to suitably enforce against poor technical competence in the waste sector.
The majority of respondents thought that notifying the regulators of the technical competence management at the site would improve technical competence across the sector. They did also raise, however, that the notification process should not be too onerous. A few respondents thought that operators could notify the regulators via their waste return. We agree that notification should not place an unnecessary burden on the sector and should be included within existing reporting mechanisms.
Respondents welcomed a registration system for TCMs. They thought that the conditions for de-registration should proportionate and clearly defined. Respondents also made it clear that waste operators still need to be held to account for the actions at their sites, as well as the TCM. We agree that de-registration needs to be proportionate and the waste operators will still be accountable.
Next steps – management systems and technical competence
New provisions and amendments will be inserted into Schedule 9 of the Environmental Permitting (England and Wales) Regulations 2016 to introduce the requirement for written management systems and the technical competence condition. The new management system condition will not come into force until 7 April 2019. This will allow affected operators to prepare the required written management system for their waste site.
Waste operators will need to submit the details of the technical competence arrangements at their site via their waste return. Failure to provide this information or to produce a written management system can result in enforcement action (such as enforcement notices) although such failure will not be a criminal offence under regulation 38(2) of the Environmental Permitting (England and Wales) Regulations 2016 as part of a phased approach to encourage operator compliance without immediate criminal consequences.
We will subsequently implement the proposals to clarify the legal requirement for technical competence and introduce a de-registration system for technical competence. This will also introduce criminal sanctions for the enforcement action. We will bring in the changes in legislation via an affirmative statutory instrument in due course.
3.4 Financial competence and provision
Questions 12 – 21 asked for views on financial competence and financial provision. Operators need to have sufficient financial standing to run their waste site to meet the obligations in their permit. Financial competence checks are currently carried out when the applicant has been subject to insolvency proceedings. Poor financial competence can lead to inadequate site infrastructure, poor pollution prevention measures, lack of investment in equipment or staff training. Poorly run waste sites can lead to permit breaches and even site abandonment. Sites go into administration and the permit may be disclaimed as onerous property, or an operator chooses to abandon the site. The consultation asked for views on three areas. These were:
- strengthening the assessment of financial competence
- introducing financial provision for non-landfill waste sites
- strengthening financial provision arrangements at landfill sites
As set out in the summary of responses there was broad support for strengthening the regulators’ assessment of financial competence. Respondents welcomed the introduction of an independent report that rates business solvency. They thought that reports should be provided to the regulators regularly or when non-compliance was detected. Some respondents, however, were concerned that a report would be a barrier to entry. We agree that the financial report needs to be proportionate to the scale of the waste operation and provided at regular intervals, rather than a snapshot of a business’ finances.
We asked for views on the broad approach for introducing financial provision. Slightly more respondents thought that financial provision should apply to all waste site operators, rather than high risk operators. We note that those who thought all waste site operators should be in scope were mainly from local authorities or were individuals. Respondents from the waste industry largely thought that only high risk sites should be in scope. We understand that who provides financial provision needs careful consideration.
Respondents provided a range of suggestions on the risk criteria to determine which waste operations should be required to make financial provision. These included, financial competence, quantity and type of waste, and net worth test. The majority of respondents thought that financial provision should reflect the cost of clearing the maximum quantity of waste allowed onto the site under the permit. Some respondents were concerned that this approach would not be sufficient because rogue operators can store more that the amount allowed under the permit anyway. Others were concerned, however, that this approach could lead to exceptionally high levels of provisions for certain operators.
The majority of respondents thought financial provision should also cover the costs of permit breaches or environmental accidents in exceptional circumstances. There was no consensus that the amount of financial provision should be reduced for waste with high recovery values. We agree that the basis for calculating financial provision needs to ensure the right balance between not putting an unnecessary burden on operators and being sufficient to deal with the site abandonment and permit breaches or environmental accidents in exceptional circumstances. The majority of all respondents also thought an operator should be able to choose the financial provision mechanism with the regulator. We understand the merits of such an approach.
We asked for views on strengthening current financial provision arrangements at landfill sites. There was broad support for each of the proposals, however, a general theme from the responses was that further information on specific proposals was required.
We will strengthen the regulators’ assessment of financial competence through a phased approach. In the first instance, we will amend the Environmental Permitting Core Guidance to clarify that financial competence checks can be carried out at any time, not just after the applicant has declared they have been subject to insolvency proceedings in the past.
We noted the support for introducing financial provision for the non-landfill waste sector. Respondents raised a range of useful points and views on the broad approach for introducing financial provision. Respondents also provided useful comments on combining a more stringent assessment of financial competence as a pre-curser to providing financial provision. Defra remains committed to bring in financial provision, and the Welsh Government is committed to identifying areas where further action can be targeted to lessen the impacts of waste crime in Wales. We will consult on specific financial provision options in 2019, with the aim to bring in legislation in due course. As part of this, we will provide more information on strengthening current financial provision arrangements at landfill sites.
4. Part B: Reforming waste exemptions
Part B sought views on options for changing waste exemptions to prevent them being used to hide waste crime.
Exemptions have a valuable role in providing a light-touch form of regulation for small-scale, low risk waste management activities. They are widely used with around 500,000 exemptions registered with the regulators across more than 100,000 sites in England and Wales.
However, since the rules for exemptions were last comprehensively reviewed in 2010, evidence has been building that some operators are carrying out illegal waste activities at exempt sites. Regulators, industry groups and trade bodies have all identified exemptions with high potential for masking illegal activity such as stockpiling large amounts of undocumented or unsuitable waste and avoiding Landfill Tax in England and Landfill Disposals Tax in Wales.
The Environment Agency and Natural Resources Wales reviewed exemptions data held on their systems and consulted area staff through a call for evidence to establish which waste exemptions were the most at risk of masking illegal activity. Through this exercise and discussions with industry they identified 10 exemptions as being of most concern. We consulted on either removing these or changing their conditions.
We also proposed changes to the wider waste exemptions regime to:
- prohibit the use of waste exemptions in specified circumstances
- require additional information to support effective regulation of the regime
- improve the process to register or continue an exemption
Because of the breadth of impacts that will result from changing these exemptions, and the implications for different business practices that can emerge from relatively minor technical changes, Defra and the Welsh Government are further considering the impacts of the proposed changes and, where exemptions are to be reformed rather than removed, the precise levels new limits of storage quantity and time should be set at.
Defra remains committed to reform the exemptions regime to prevent their use for hiding illegal activity. We will publish a supplementary government response next year setting out the proposed changes and how these have been informed by the consultation responses, ahead of introducing legislation to implement them.
5. Part C: Duty of care fixed penalty notice
Part C of the consultation sought views on the introduction of a fixed penalty notice (FPN).
Section 34(2A) of the Environmental Protection Act 1990 places a duty on occupiers of a domestic property in England and Wales to take all measures reasonable in the circumstances to ensure they only transfer their household waste to an ‘authorised person’. This is defined further in legislation, but is normally either the local authority collection service, a registered waste carrier or an operator of a registered site.
While two-thirds of fly-tipping incidents involve household waste, this is often fly-tipped not by the individual that produced it but by the person or business they used to take it away. Reducing the flow of household waste to unauthorised carriers will help ensure it is managed and disposed of appropriately and not fly-tipped or similar.
Currently, if someone fails to meet their duty of care the only options are for the enforcement authority (usually the local authority) to offer a warning or caution or to prosecute them for the criminal offence of failing to comply with their waste duty of care. Each year there are a number of successful prosecutions. However, these prosecutions are costly for the authority and increase the workloads of courts, and also result in the offender being left with a criminal record.
Introducing an FPN would provide authorities with an alternative enforcement option to prosecuting offenders through the courts.
To support implementation of the fixed penalty notice, we also consulted on updates to the Waste Duty of Care Code of Practice to more clearly set out the requirement of the household waste duty of care and the steps people can take to meet it, and on new guidance for local authorities in England on use of the FPN. A separate process was undertaken in Wales to develop local authority guidance.
5.1 Introducing the FPN
As set out in the summary of responses, 88% of respondents agreed that introducing the FPN will help tackle fly-tipping by cutting of the flow of waste to illegal operators.
The summary of responses also identified a significant consensus on the lack of awareness of the duty of care. Defra and the Welsh Government fully agrees with this view. It is anticipated that the introduction of the FPN will itself increase awareness of the duty of care. To further support this, a Defra funded research project has explored the most effective means of raising awareness of the duty of care and engaging people so that they adhere to it. The findings of this research project will support existing awareness raising campaigns being rolled out by local authorities and other groups. In Wales, the Welsh Government is working with Fly-tipping Action Wales to develop a communications package to help raise awareness of the duty of care and the proposed introduction of the new FPN powers.
Defra and the Welsh Government also agree with the view that FPNs should be issued in a proportionate manner, and that issuing FPNs for the household waste duty of care should not take the focus away from seeking to fine or convict fly-tippers themselves. Instead effective enforcement of the household duty of care provides a second complimentary route through which fly-tipping can be prevented.
Informed by the responses to the consultation, Defra will be introducing legislation for the use of the FPN in England in November 2018. This will be supported by guidance for local authorities in England on the use of the fixed penalty notice, and updates to the Waste Duty of Care Code of Practice to provide greater clarity on the steps people can take to meet the household waste duty of care. Following the consultation on the guidance and code of practice over the summer, the documents have been refined to address concerns raised, as set out in the separate summary of responses to that consultation. Legislation for Wales will follow in early 2019 and Welsh Government will publish similar guidance for local authorities to support the introduction of their own FPN legislation early in 2019.
Local authorities in England and Wales may issue the FPN when an individual appears to have failed to comply with their duty of care under section 34(2A) of the Environmental Protection Act 1990.
If someone is considered to be a vulnerable person, for example due to circumstance, age related ill-health, or a mental or physical disability or divergence, close consideration should be given as to whether it would be proportionate and in the public interest to issue a fixed penalty notice. This should be on a case-by-case basis.
In England, the legislation will set out the following limits for the FPNs. These are set to ensure the cost of illegal disposal and receiving an FPN are higher than the cost of legitimate disposal, but lower than the typical fine received when cases are taken to prosecution.
|Default penalty||Minimum full penalty||Maximum full penalty||Minimum discounted penalty|
Some respondents raised concerns over people potentially receiving the same level of penalty as the fly-tippers themselves when the latter was perceived to be a worse crime. However, failure to set the FPN at these levels would allow it to still be cheaper to use an illegal waste collector, with the costs passed on to the local authority or private landowners for clearing fly-tipped waste. Other respondents called for the FPNs to be higher to further reflect these clear up costs. A final decision on penalty levels in Wales will be made in due course.
The fixed penalty notices will be issued in England and Wales as an invitation to discharge liability for the existing criminal offence of failure to meet the household waste duty of care. This follows the approach taken for fly-tipping and litter FPNs.
A local authority cannot pursue an unpaid FPN through the courts. Instead a recipient choosing not to pay the FPN has chosen not to discharge their liability for the criminal offence, and the local authority can proceed to prosecute that offence in the same way as currently.
Legislation for the FPN is being laid before Parliament this year and the FPN will come into force in England in 2019. In Wales, draft regulations will be laid before the National Assembly for Wales for approval early in 2019.
The guidance for Local Authorities in England and the updated Code of Practice will be published alongside the introduction of the England FPN legislation in parliament. Local Authority Guidance for Welsh Local Authorities will be published following the FPN legislation being introduced in Wales. The documents should be used from the respective dates on which they’re published in relation. Material specifically relating to the FPN will not apply in England and Wales until the respective FPNs are in force.