For the past few years waste exemptions, intended to provide a light-touch form of regulation for low-risk activities, have been the flexible friend of businesses and the regulator alike. The beauty is in the system’s simplicity. But the system is so simple that it has become open to abuse and almost impossible to police.
Environment Agency (EA) data shows that by the end of June 2019 there were 487,432 exemptions registered with regulators across England. Of these, 406,969 (83%) were on farms. The number of sites holding exemptions is thought to be more than 130,000. These are big numbers, given that very little monitoring is going on.
“We’re not against a low-risk approach [but] we’ve been saying for some time that the whole regime needs to be tightened up,” explains Sam Corp, head of regulation at the Environmental Services Association (ESA). “There is too much latitude.”
There are 59 waste exemptions covering four activities: disposal (D), use (U), storage (S) and treatment (T). Each one sets out the types and amounts of waste that can be managed and, with a few clicks on the computer, businesses can select the exemptions they want.
All except one of the exemptions are free. “They’re deliberately easy to get hold of... and they’re really valuable for small-scale activities,” explains Sam Taylor, a principal consultant at Eunomia and head of the consultancy’s London office (which has a waste exemption for its wormery).
However, there are fears that the lack of monitoring and ease of registration makes exemptions a target for criminals. In a 2017 report, ESA estimated that 5% of exemptions are operating in breach of their conditions, with a total potential economic impact of more than £87m in 2015. It wants a reduction in the number of exemptions, as well as the number allowed per site. The freedom to rack up countless exemptions on one site is certainly causing concern – indeed, through the use of exemptions it is possible to reach volumes on a site greater than the baseline for an environmental permit.
Meanwhile, some of the waste volumes are expressed as daily levels, while others are annual, making it difficult to monitor.
Dr Anna Willetts, a senior associate at law firm Clyde & Co, says the system is “easy to abuse but not often intentionally”. She says her clients “keep being prosecuted” because they don’t know the limits in their exemptions, or can exceed limits when more than one operator is using the exemption. “I’d say 70-80% of my prosecutions in the last few years have been from the Environment Agency in relation to waste exemptions,” she says. “The penalties can be pretty serious.”
What proportion of the £87m is criminal activity and how much of it is businesses not reading the conditions of their exemption is impossible to say. Businesses also have to remember to reapply every three years. In practice, there is little checking, explains 360 Environmental director Phil Conran, although the EA has recently “started checking sites operating under certain exemptions to ensure they are operating within the limits”.
Seven exemptions are due to be revised as part of the government’s plans to reduce crime in the waste industry, which were consulted on last year. These include U1 (use of waste in construction), S1 (storage in secure containers) and S2 (storage in a secure place).
The others are T4 (preparatory treatments), T6 (treating waste wood and waste plant matter), T12 (manually treating waste) and D7 (burning waste in the open). This could see the quantities cut or a reduction in the types of waste covered. The government is also withdrawing three exemptions – T8 (mechanically treating end-of-life (ELV) tyres), T9 (recovering scrap metal) and U16 (using depolluted ELV vehicles for parts).
Meanwhile, in October the EA opened consultation on standard permits for some of the withdrawn (T8) and revised (T4 and T12) exemptions. In all, the EA has identified 10 exemptions as being most at risk of masking waste crime, and almost 200,000 of these have been registered. Reform of the waste exemption regime will also include restrictions on how many exemptions can be registered at the same place. There will also be restrictions on exemptions at sites holding waste permits.
The changes were all due to be finalised by the end of the year, according to the government’s Resources and Waste Strategy. But given the pressure on parliamentary time, spring is possibly a more realistic deadline.