Thursday, 11 June 2015

Borders landfill tax burden calculated by forgotten formula


An investigation by Not Just Sheep and Rugby suggests the failure to deliver a functioning waste treatment plant for the Borders over the last 12 years could be costing significant amounts per month in increased landfill tax.

Following the collapse of Scottish Borders Council's massive 24-year contract with New Earth Solutions (NES) earlier this year the local authority was asked to divulge the projected additional payments of landfill tax over the five years from 2013/18.

If councillors had proceeded with their original (2010) project for a conventional treatment facility at Easter Langlee on the outskirts of Galashiels up to 80% of refuse would have been diverted from landfill on the completion of the plant in 2013.

But instead, for reasons which have never been made public, elected members decided in October 2012 to embark on a much more ambitious - and extremely risky - scheme involving untested technology to convert waste to energy. Eventually that dangerous strategy led to the complete collapse of the entire project at great public cost.

The council's response to a Freedom of Information request for the extra landfill costs produced the following response: "For the period in question 2013/18 there is no additional gate fee [cost of disposal] or landfill tax costs as a consequence of terminating the contract with NES."

However, this is not the first Borders waste treatment project to hit the skids. Between 2003 and 2008 SBC and neighbouring local authorities were involved in another initiative which must have cost many millions of pounds and huge amounts of staff time plus the inevitable commissioning of expensive consultants.

It was known as the Lothian & Borders Area Waste Plan (LBAWP), and it worked on a project to produce a single waste strategy for the entire south-east of Scotland. The task was enormous. The area was generating 555,000 tonnes of municipal waste per year including 68,000 tonnes in the Borders, equivalent to 12% of the overall total.

An extensive collection of documents relating to LBAWP - abandoned in the face of policy changes at Scottish Government level - remain available online. They show that even back in 2007 when 77% of waste was being landfilled there was an urgent need for action if future diversion targets had any chance of achievement.

Included in the array of documentation is a report written in 2007 which contains disturbing predictions of additional landfill fines and landfill tax which the five partner authorities would face unless the project was delivered. The increased penalties and taxes were due to kick in during 2013.

According to the report which was considered by SBC: "Any delay at this point exposes the five councils to the potential of landfill fines of £1.5 million for each month delay by 2013. In addition, the councils are exposed at 2013 to increased landfill tax of over £700,000 per month for delay."

The system of fines remains suspended, but penalties could be reintroduced at any time.

When the report was produced SBC was facing 12% of those additional overall costs by 2013. It works out at £180,000 per month in potential fines plus £90,000 per month in additional landfill costs.

So as things stood back in 2007 those respective extra fines and taxes over the five years from 2013 to 2018 would total £10.8 million and £5.4 million respectively.

No doubt the improved recycling rates and other initiatives have resulted in considerably lower landfill bills than those calculated from the LBAWP formula. At the same time it is hard to believe all of the predicted additional costs have been eradicated.

But it is clear expenditure on waste treatment would have been substantially below current levels had Borders councillors stuck with the original 2011 decision for the construction of the conventional facility rather than the alternative which had to be abandoned because of technological and funding issues.

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