A new report by the Chartered Institution of Wastes Management (CIWM) identifies future fiscal measures that would incentivise a more circular economy in the UK.
The “Shaping Future Financial and Fiscal Policies for a More Circular Economy in the UK” report is structured around three overarching aims of resources policy: decarbonising the waste sector, increasing recycling, and reducing resource consumption.
The research, undertaken by Resource Futures, analyses key policy incentives to assess their impact, unintended consequences, gaps, and conflicts or synergies with other incentives.
It also identifies potential improvements for a more cohesive policy framework in support of circularity.
Commenting on the report’s publication, Dan Cooke, CIWM Director of Policy, Communications and External Affairs, said the benefits of a more circular UK economy “are clear”.
Cooke said a more circular economy “creates jobs, enables economic growth, and delivers resource resilience and carbon reduction”.
“This timely piece of research provides useful insights for our sector, policymakers, governments and the Circular Economy Taskforce,” Cooke said.
“The findings can help us consider how well-crafted financial incentives and policies can most effectively move us towards a more circular UK economy.”
The strategies and requirements for future fiscal measures the report identifies include:
- Designing more nuanced incentives to achieve contemporary circular economy and waste management goals: reuse and reduction, higher quality recycling, and decarbonisation.
- Refocusing policy development efforts on sectors and material streams with higher overall impacts.
- Using Extended Producer Responsibility (EPR) schemes to explicitly promote reuse.
- Improving existing fiscal levers to create stronger incentives for circularity, including inert materials.
- Ensuring strong data, monitoring and enforcement, which are essential to ensure incentives have the intended effects.
The research identified the weaknesses and problems associated with seven key fiscal and financial incentives and then produced a range of options for strengthening the policy framework.
One proposal is for money raised through financial and fiscal policies to be used to drive system change towards a circular economy.
Cooke continued: “The report shows that financial levers can have a powerful effect, and several have already driven positive trends to move materials and behaviours up the waste hierarchy.
“It also shows that strong data, monitoring and enforcement are essential to ensure incentives have the intended effects.”
Susan Evans, Policy Lead at Resource Futures, commented: “This report highlights areas where more nuanced fiscal and financial incentives are needed to drive not just more recycling, but higher-quality recycling that contributes more to the economy, as well as reuse and remanufacturing activities which can drastically reduce the environmental impacts of our resource use.”
