Government investment in resources and waste sector will pay dividends to levelling up agenda

Jacob Hayler, Executive Director ESA, Feb 23, 2022

Amid political turmoil at Number 10 last week the government released its long-awaited levelling up white paper, setting out plans to deliver on the Conservative 2019 manifesto promise to bring greater economic equality to regions across the United Kingdom – closing the gap between richer and poorer areas by 2030.

Encapsulated within the medium-term policy missions needed to achieve this, the paper sets out a desire to boost productivity, pay, jobs and living standards by growing the private sector, which the government says will principally be achieved by developing a more flexible and better regulatory model for business outside the EU, and reforming “outdated” EU rules restricting investment from pension funds and others to stimulate the flow of money into long-term capital assets. The white paper describes the private sector as “the real engine of wealth creation” and highlights the need to provide the conditions for businesses to invest more, grow more and take more risks. 

The government cites a few examples of what it sees as the delivery of “green manufacturing innovation” – electric and hydrogen vehicles, wind turbines and batteries – but disappointingly omits to mention the obvious opportunities (at least to those of us involved day-to-day) for green manufacturing innovation inherent in circular economy industries. 

Growth and productivity remain key economic cornerstones for governments around the world, but is the continued mantra of more of everything for everyone compatible with a world of finite resources in the long run? 

Great Britain has a thriving resources and waste sector and circular economy industries offer the opportunity to deliver sustainable growth in employment, prosperity and productivity while making use of existing material resources in perpetuity. Recycling, reprocessing, remanufacturing and waste management industries are also already among the least geographically-concentrated industries in the UK and our members alone stand ready to invest more than ten billion pounds in new services and infrastructure over the next ten years – with much of this investment targeted at the very regions and local areas the government seeks to level up. 

Additionally, efforts to decarbonise recycling and waste management activities by 2040 will bring with them further economic opportunity – with the UK at the global vanguard in this space – both directly and by supporting other emerging industries, such as electric transport, batteries and carbon capture. 

Circular economy industries are not just essential to the health and sustainability of the nation, they are also hotbeds of innovation and require increasingly technical solutions to return post-consumer materials back into the economic cycle – from chemical and molecular level recycling of plastics, to using waste as sustainable aviation fuel, not to mention capturing and reusing increasingly scarce metals and other elements vital to high-tech industries. These activities will create attractive new purpose-driven jobs and will require new and different skill sets and education backgrounds - particularly in STEM subjects. 

In the white paper, government sets out six “capitals” needed to drive levelling up and it is clear that the resources and waste sector holds significant potential to deliver against them all, but our needs diverge somewhat from the sentiment in the levelling up paper in that our sector is reliant on strong environmental regulation to continue to push waste material up the waste hierarchy – the transition driving the most profound changes in our sector and subsequent investment in people and infrastructure. 

Unlocking our sector’s potential to support the levelling up agenda only requires the government to stay the course on its existing Resources and Waste Strategy, and other associated policy-drivers already in the pipeline – particularly in seeing through its plans for extended producer responsibility and taxation on the use of virgin plastics. Some have already critcised the levelling up paper as lacking fresh-thinking, but fresh-thinking is not what our sector needs to support it - we just need action now. 

The plastics tax, due to be implemented in April, has already delivered tens of millions of pounds in new domestic reprocessing facilities, bringing new employment opportunities, but with delays to the Resources and Waste Strategy caused by the pandemic, rapid rises in the cost of living and the next General Election cycle, it is vital that the Government does not become short-sighted. Policy-makers should instead view support for our sector now not just as vital for the environment in the long-term, but also an investment in the delivery of the levelling up promises made to the electorate for the next decade.