Single Use Carrier Bags Charges (England) Order 2015

Debate between Lord Whitty and Viscount Ridley

Wednesday 4th March 2015 Grand Committee

[Viscount Ridley (Con)]

My Lords, I want to make a couple of quick points and press a couple of questions similar to ones that have already been made. What we are talking about is known in economics as a Pigovian tax. I know this is not a tax but Pigovian taxes are intended to discourage activity. The one thing economists say about them is that they should be as technology-neutral, as transparent and as even as possible, otherwise they simply push down something that pops up somewhere else. I worry that we are talking about dealing with what is a very small part of the amount of plastic litter that ends up in the countryside. The point has been made that there is an awful lot of litter on roadsides, particularly at this time of year, and relatively little of it consists of supermarket plastic bags. I have heard the figure of 1%, although I do not know if that is right. Is it not possible to come up with something much more neutral about plastic technology generally across the board, to see whether we can discourage it without picking on this one bag?

I find it very hard to believe that the savings in littering and CO₂ will be in the region of £780 million— I think that was the number I heard. This is only a relatively small part of the litter that is around. I cannot believe that 10 minutes less spent picking up litter on the side of the road because there are no plastic bags there will add up to £780 million. On the CO₂ point, I echo what the right reverend Prelate the Bishop of Chester said. It is not at all clear that the alternatives will produce less CO₂—unless we all use the equivalent of the right reverend Prelate’s bag and I am not sure that everybody will. We know that more energy often goes into making paper bags by the time that transport and everything else is taken into account, whether or not, as my noble friend Lord Holmes said, that paper bag gets reused. We also heard from my noble friend Lord Lindsay that oxydegradable plastic bags will have an impact on the recycling chain. Can we make absolutely sure that, when we quote figures for the amount of carbon dioxide that will be saved by this measure, they are honest and properly audited? One hears some claptrap in this area and it would be nice to be sure that the figures are right.

The hypothecation of taxes—that is, when a tax automatically goes to one use rather than just into the Treasury—is something that the Treasury has always resisted. I know that this is not a tax—it is a charge—but none the less it has been hypothecated to certain good causes. On the whole, that is quite a good idea, as long as the customer is allowed to direct where it goes. I hope that that becomes a slightly more general point across government.

[Lord Whitty (Lab)]

My Lords, I suspect the Minister was hoping for full approval for this government initiative. I am gratified that the Government have finally got around to it. I have been campaigning on this front for at least 15 years, so I am glad that, 13 years after the Republic of Ireland, and then following the devolved Administrations within the UK, we have at last reached this position. To continue the scriptural allusions of my noble friend Lord Dubs, there is always much joy in heaven for a sinner who repenteth, and we should all appreciate that. Nevertheless, we could have had a much clearer policy announced today—one that would have been better understood by the public. I was struck by the point made by the noble Lord, Lord Holmes, that it is people who litter, not bags. That is absolutely true. However, as the noble Viscount, Lord Ridley, said, the whole point of this tax is effectively to change behaviour. It is not a tax; it is a levy.

My noble friend Lord Anderson referred to the experience in Wales. I happened to be in Tesco in Dundee on Sunday with a young lad. I would not say that he had great green credentials nor that he was always affected by prices, but he had already—this is relatively new in Scotland—changed his behaviour and brought a bag with him. That is the point. Yes, in the end, it is people who create litter and, by using these plastic bags, not only cause unnecessary carbon emissions but bring desecration to our countryside, wildlife, marine life, beaches and many of our city centres. I am glad that my noble friend Lady Golding found only one plastic bag in her car park, but I must say that that is not the general experience in either urban or rural car parks, or in other open spaces. It has been reported that some 2,000 of them can be found on every square kilometre of beach. That is atrocious from the aesthetic as well as the environmental and economic point of view.

I welcome the principle, but it has been unnecessarily curtailed, and in such a way that it does not do what it alleges it intends to do. The big exemption is for retailers with fewer than 250 employees, which exempts quite large retailers and represents around a third of all retail outlets. These exemptions do not exist in the devolved Administrations, but the exemption for very small retailers from completing the reporting mechanisms—the real red tape and administrative burden—is set at 10 employees. That seems to be a sensible approach. The exemption should be from the reporting and administrative burden, not from the requirement to impose the charge.

The exemption makes a big difference to the figures in the Government’s own impact assessment. The net present value of this over 10 years, according to the impact assessment set out on page 7 of the Government’s report and as indicated by the Minister, is £782 million. However, it would rise to more than £1 billion if all retailers were included. The Government’s position would be understandable if the retailers themselves were strongly pressing for this exemption, but I am sure that other noble Lords have seen the representations from a number of organisations that represent retail outlets, all of whom are saying, “This is daft and will actually impose a burden on retailers that will put them at a competitive disadvantage in certain respects”.

The British Retail Consortium has said that it is unfair to put smaller retailers in a position where they have to choose whether to charge. There are doubts about having an inconsistent position across the UK. The Association of Convenience Stores has said that some 60% of its members support a single-use carrier bag levy being applied, and in Wales, where it has actually happened, more than 80% of convenience stores support it. The association would strongly support its own membership being covered by this in England as well as in Wales, Scotland and Northern Ireland. The British Independent Retailers Association, which is the voice of the independent retailer and is often critical of the red tape of government regulations, has said that this should cover businesses of all sizes and that the only exemption should be on the administrative burden, to which I have referred. The Government do not have the support of those who would allegedly benefit from the substantial exemption this order provides for.

There are other exemptions or potential exemptions which can also be queried. The noble Earl, Lord Lindsay, has spelt out comprehensively why the issue of oxo-biodegradable bags is not worthy of being considered as an exemption because of their knock-on effect on waste management and the reusability of plastics in general. Others have queried whether other sorts of bags that are being exempted should have that exemption. The big issue I refer to in that respect is: why should non-reused paper bags be excluded when they themselves have a very high carbon content and are a significant part of the litter around our towns and countryside?

Given, therefore, that there is now a general acceptance of this approach, and that the alleged beneficiaries of the exemptions do not seem to be in favour of the Government’s position, why do the Government persist in doing this? Why, in particular, do they do so when the rest of the United Kingdom does not provide for those exemptions, or most of them, and when we may well be faced with a European directive at some point, which will probably not have those exemptions either?

As I say, we should give at least two cheers for the Government for coming forward with this at last. Nevertheless, it is a pity that they have botched it a bit, and I hope that maybe they will fairly rapidly rethink this, and that, even if we adopt this statutory instrument today or when it is considered in the Chamber, they will come back and say, “Actually, these exemptions are pretty much a nonsense. Let’s make it straightforward so that everybody can understand it, and it will have the effect on everybody, whether they are a customer of a small or large business, whether they have a plastic bag or a paper bag, and whether they are in the country or the centre of our towns”. I hope that the Minister will take that at least as partial support, but some rethinking would be appropriate in his department.