Businesses facing the prospect of a tax on their primary activity can hardly be expected to roll over and cheer. Still, the reaction does vary. When, for instance, the waste management industry was put on notice to expect a landfill tax, the adverse response was more muted than may have been expected.
The explanation can be found in the attractive opportunities evident to the sector's leading players to divert material from landfill and add value - and profit - by segregating, treating and recovering value from waste, and in consolidating their market position as smaller or less imaginative competitors failed to make the investments to move their own operations up the waste hierarchy. The process of shifting waste out of landfill will take longer than the industry's perennial optimists may have predicted, but, with a little extra help from the new EC landfill Directive (see pp 21-25 ), it is clearly well on the way.
The quarrying industry's reaction to the prospect of a tax on aggregates has been rather less enthusiastic. In a submission to a recent parliamentary inquiry which saw not the faintest merit in the idea, the Quarry Products Association opened by asserting that aggregates are "fundamental to our way of life" and the industry's activities "overwhelmingly positive and beneficial to society." The same refrain has been heard over the years from the chemical and nuclear industries as they sought to overcome their own public acceptance crises, but few have taken much notice.
The QPA does have legitimate grounds for concern about some aspects of the official study into the environmental externalities of quarrying which will inform the Chancellor's thinking on an aggregates tax (see pp 17-20 ). For instance, a valuation of the average externality of hard rock quarries, which is heavily influenced by the bids of a handful of people living some distance from one of the three sites studied, clearly cries out for further research.
The industry, naturally, has been less inclined to highlight data missing from the study which would tend to inflate the externality figures. A fair number of impacts associated with both land-won and marine-dredged aggregates were not valued at all. And, while three times as many individuals wanted their local communities to be compensated as made bids for personal compensation for the impacts of their neighbouring quarries, their wishes were excluded from the overall externality estimates. The conclusions to be drawn from these considerations are highly discomfiting to the industry.
The strategic challenge facing aggregates businesses as a tax looms on the horizon is not so different from that facing other industries. In the energy sector, for one, companies which will have to operate in future under the constraints imposed by climate change will have to understand that what their customers need is not electricity, gas or any particular fuel but a clean and efficient means of obtaining heat, light or motive power. By analogy, demand for aggregates is not a demand for rocks and stones freshly dug from the earth but a demand for materials with appropriate attributes for the job in hand.
Shell and BP have recently begun the long process of transforming themselves from oil into energy businesses by announcing plans for substantial investments in renewable energy. In the aggregates sector, Tarmac is probably leading the field in assembling a tidy portfolio of secondary aggregates operations (see pp 14-15 ). This is the repositioning which Planning Minister Richard Caborn had in mind when he offered the industry a guiding motto in May: "The closer we can get to the concept of 'aggregate supply' without distinguishing between newly dug, recycled or secondary material, the better."