Waste Industry: Criminality and Regulation

Lord Beamish Excerpts

Tuesday 1st February 2022 Westminster Hall

[Mr Kevan Jones (North Durham) (Lab)]

I congratulate the hon. Member for Newcastle-under-Lyme (Aaron Bell) on securing the debate. He has summed up the situation well.

I have been involved trying to expose this issue for the last 10 years, along with the right hon. Member for Haltemprice and Howden (Mr Davis). Everyone knows what is going on. They know about the lack of regulation, the low threshold for getting into the industry and the involvement of organised crime. HMRC itself in its tax gap report recognises that some 22% of landfill tax is not being paid, although it actually put a profit warning on that. The Environment Agency knows not only what has been lost in tax revenues, but that the clean-up costs will fall on the taxpayer. Everyone knows that the matter involves organised crime. I have raised it for the last 10 years, and I am sure the right hon. Gentleman will allude to that as well. We have explained all this to the Government, but there seems to be inaction in respect of getting the agencies together.

The Environment Agency is not capable of addressing the matter. It may be good at cuddling newts and protecting forests, but it is not good at having an enforcement attitude. HMRC is frankly a disgrace, and I will give an example of why I say that. I got involved in the matter because of a company in the north-east called Niramax. I only had to look at the directors of the company to see something was wrong. Organised criminals—one of them is in prison for murder, and the police told me that his associates had convictions and were involved in a whole host of organised crime—suddenly got involved in waste management. They bought a landfill site in the constituency of the right hon. Member for Haltemprice and Howden, which I know he will talk about, and one or two in the north-east. They then set out to undercut legitimate businesses. Talking to people in the waste industry, there is no way they could pick up that waste for the amounts they charged.

It ended up with Operation Nosedive, which HMRC instigated in 2014. HMRC raided the premises and claimed £78 million was to be reclaimed. That was suddenly halted in 2020. The right hon. Member for Haltemprice and Howden and I asked why it had been halted and we were told, “No, no. You can’t look into this because it is HMRC.” The National Audit Office has done a very good investigation that showed HMRC spent six years and £3.5 million of public money, but there were no convictions and there was no outcome.

Everyone knows what the problem is, but there has got to be action. I say to the Minister, I do not want more initiatives about fly-tipping and this, that and the other; I want co-ordinated action between the agencies that have the powers to crack down on this.

[Sir Gary Streeter (in the Chair)]

You have two and a half minutes each, colleagues.

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[Deidre Brock (Edinburgh North and Leith) (SNP)]

It is a great pleasure to serve under your chairship, Sir Gary. I commend the hon. Member for Newcastle-under-Lyme (Aaron Bell) for securing this really important debate.

It is clear from everything that has been said by Members across the Chamber that illegally dumped waste is a massive scourge that is blighting communities across the UK, with huge environmental, social and economic cost. Indeed, as our Justice Secretary and chair of Scotland’s serious organised crime taskforce, Keith Brown, said recently, this is not a victimless crime. Waste crime causes pollution and increases public health risks. It places enormous strain on legitimate operators, and serious and organised waste criminals have a considerable impact on the economy of all the nations of the UK.

Every year in Scotland, 250 million easily visible items are dropped as litter, and an estimated 26,000 tonnes of material is fly-tipped. According to research by Zero Waste Scotland, at least £53 million of public money is spent on addressing that.

[Mr Kevan Jones]

Is the hon. Lady aware that operators get around Scotland’s zero waste strategy by transferring waste over the border, much of it to the north-east? That has been raised with the Scottish Government, but nothing seems to be being done about it.

[Deidre Brock]

I am going to talk about a co-ordinated approach that all four nations of the UK can take to address those sorts of issues. I will also go on to mention a programme aired by BBC Scotland last night, “Disclosure Scotland”. I highly recommend that all Members look at it, because it focused on waste criminals heading over the border to Scotland, which is the exact opposite of what the right hon. Gentleman said. Of the £53 million I mentioned, I believe that it costs Scottish councils £11 million to remove waste from council-owned land alone.

A high proportion of individuals and organisations involved in illegal waste dumping are also associated with other organised crime, including violence, drugs, weapons and money laundering. Last night’s episode of “Disclosure Scotland”, which can be found on iPlayer—it is entitled, aptly enough, “Dirty Business”—exposed the scale and severity of that waste criminality. It highlighted a wide range of illegal activities, from man with a van fly-tipping and waste being burnt in a drum, to much larger-scale operations such as enormous illegal landfills and, increasingly, abandoned lorry trailers overflowing with waste that is simply left to rot.

The programme showed investigations by the Scottish Environment Protection Agency, including on a site where a criminal gang had buried large amounts of waste, which released harmful gases and liquids as the deposit degraded. Some of that waste was brought from outwith Scotland by the gang and is believed to include hazardous clinical waste from hospitals. The programme revealed that threats and intimidation have been made against landowners who refuse to allow waste to be buried on their land; others spoken to by the BBC were too scared to go on the record.

I believe that the majority of viewers—and, indeed, those listening to this debate—will have been shocked by those activities. They show that waste criminality goes far beyond small-scale fly-tipping. That is why Scotland’s serious and organised crime taskforce, chaired by the Scottish Justice Secretary Keith Brown, has made waste crime a top priority. The Scottish Government and their partners on the taskforce will use every means at their disposal to stop such illegal practices and ensure that those who dump waste illegally are held accountable. Although offenders risk criminal convictions, fines of up to £40,000 and/or imprisonment for 12 months, only a fraction of those responsible are prosecuted.

As we have heard today, criminals operate across borders and with similar methods. Collaboration and intelligence sharing across the UK is extremely important. The joint unit for waste crime, established in 2020, already brings together law enforcement and environmental protection agencies from across the UK. The Scottish National party wants to see that built upon via the introduction of mandatory electronic waste tracking and a UK-wide database of registered brokers—another recommendation of the independent review—which will make it easier to find these culprits and ensure they are brought to justice. I am sure the Minister will speak about that shortly.

Viewers of last night’s programme will have been completely shocked by the huge amounts of waste revealed —waste that, for far too many of us, is out of sight, out of mind. Across the UK, particularly since the UK has been prevented from exporting much of its waste by other countries quite rightly tightening their rules on imported waste, we are starting to drown in waste. It is essential that we find means of dealing with it much more effectively.

Scotland has committed to building a circular economy, meaning that we reduce demand for raw materials. We want to support and make the system fairer for those operating legally whose businesses are being drastically undercut by criminals. We support the UK Government’s plans to introduce waste monitoring. The consultation on the proposals to ensure that they work for Scotland will be of great importance to us. We certainly look forward to the outcomes, with our preferred outcome being for mandatory electronic monitoring. It is imperative that we work together to root out waste crime and bring perpetrators to justice.

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[The Parliamentary Under-Secretary of State for Environment, Food and Rural Affairs (Jo Churchill)]

It is a pleasure to serve under your chairmanship, Sir Gary. I congratulate my hon. Friend the Member for Newcastle-under-Lyme (Aaron Bell) on securing this debate and on the determined way in which he has championed this issue in the House. Indeed, all the neighbouring Stoke MPs have really got to grips with waste in their area.

As soon as I became a Minister, it was clear to me that Newcastle-under-Lyme was top of the list of places I should visit. I thank my hon. Friend and members of his community, including Dr Salt and others, for welcoming me and talking so frankly about the impact that Walleys has had on their lives. They were also constructive about how we move forward to reduce landfill and ensure that people can live their lives in the areas that they choose to be in, without being blighted by its effects.

My hon. Friend has always taken care to articulate the views of his residents. The Environment Agency continues to bring about the work needed for a long-term solution at Walleys Quarry, and both he and I will watch the situation closely. The hon. Member for Newport West (Ruth Jones) referred to the large number of issues reported last year, and we have seen a spike on one of the monitors up to those sorts of levels again recently. I reassure my hon. Friend’s constituents that I get those weekly reports and examine them in detail, because it is important that we are rigorous in ensuring that where we need to challenge, we have the right data. That goes to the points made by all hon. Members, including my neighbour and hon. Friend the Member for Central Suffolk and North Ipswich (Dr Poulter), about ensuring that we have the correct data so that people can proceed to enforcement and so on, because they can challenge on the basis of accuracy.

[Mr Kevan Jones]

I do not disagree with that, but does the Minister not find it remarkable that in 26 years of the landfill tax, HMRC has not had a single successful prosecution in connection with it? The only initiative that I am aware of is Operation Nosedive, where HMRC spent six years looking at it and £3.5 million of public money, and got nowhere. This is not about new regulations; it is about using the tools we have already got.

[Jo Churchill]

This is indeed about using tools. The right hon. Gentleman refers to an operation by HMRC. Obviously, I am not the Minister responsible for that, but I am sure he can take Operation Nosedive up with them. [Interruption.] Indeed, but he makes a cogent point. As several Members have said, this issue has been described as being akin to the narcotics industry. It is that insidious. It blights people’s lives and, as we have heard, raises considerable sums of money illegally in so doing. I therefore agree with everybody that we need firmer action, and I will continue to ensure that we look at that.

I am aware that the Environment Agency recently launched an investigation into the allegations of criminal activity at Walleys Quarry. I welcome any investigation where allegations of waste crime have been made, and I am sure the Environment Agency will investigate this thoroughly, knowing that we are all watching. I appreciate the importance of the investigation to my hon. Friend the Member for Newcastle-under-Lyme and his constituents. I am sure that he will appreciate that I would not want to inadvertently say something that would jeopardise it in any way, but my door is always open to him, as he knows.

The Government are determined to tackle waste crime, because it makes life a misery for all our constituents. Whether it is fly-tipping on country lanes—as my hon. Friends the Members for Stroud (Siobhan Baillie) and for Darlington (Peter Gibson) alluded to—litter in our towns or pollution from waste sites, waste crime and poor-performing waste sites undermine legitimate businesses, deprive the public purse of tax income, harm the environment and communities, and in the worst cases directly threaten health. Councils are now spending £1 billion of taxpayers’ money cleaning up after this, so it affects all of us.

We have already taken action to introduce new powers to stop illegal waste sites posing a risk, which include the ability to lock up sites and force rogue operators to clean up their waste. More widely, we have given the EA an extra £60 million to tackle waste crime since 2014, on top of the wider grant-in-aid funding that it receives from DEFRA. I would just like to offer a correction: at orals last week I said on the Floor of the House that this funding was given to the EA “in 2019—I think”. In fact, it was given in 2014, and I am happy to correct the record.

We have also set up the joint unit for waste crime to disrupt serious and organised waste crime and reduce its impact. The unit involves the National Crime Agency, HMRC, the EA and the police. We set it up about six months ago, and there were more than 30 arrests in the first 24 days, so action is being taken. The landmark Environment Act 2021 does even more, giving agencies enhanced powers to gain evidence and enter sites. I was pleased that my hon. Friend the Member for Darlington said that they are using the powers they have to seize cars and vehicles, because life needs to be made difficult for these people. Powers are there; they need to be used. We need to encourage our councils, and to that end we are bringing out best practice for councils so that they know how best to gather evidence and so on, so that prosecutions are likely to be more successful.

We will go further. The two consultations mentioned earlier outline the next steps to tackle waste crime and to support people and businesses to manage waste correctly. Electronic waste tracking ends the old-fashioned paper-based approach and gives us a modern, connected future. We will be able to track waste movements, understanding exactly who moves waste and to where. That will give us powerful new abilities to audit waste movements and to ensure that waste is disposed of correctly.

[Mr Kevan Jones]

indicated dissent.

[Jo Churchill]

I see the right hon. Gentleman shaking his head. Why does he not come and have a chat with me? He can tell me everything.

[Mr Kevan Jones]

Along with the right hon. Member for Haltemprice and Howden (Mr Davis), I am sick of talking to Governments that have, over the past 10 years, trotted out the same nonsense every time. We need action. I can tell the Minister a lot of ways to get around electronic tracking. These people are very sophisticated, and if we do not have an enforcement attitude at HMRC and other agencies, we are frankly wasting our time.

[Jo Churchill]

We will have digital tracking, extended producer responsibility, consistent collection and a carriers, brokers and dealers licensing regime to regulate the people involved in waste. That goes to the comments that have been made about appropriate people running these companies. In 2019, the Government expanded the list of convictions to be taken into account when assessing permit applications to include offences relating to organised crime and violent or threatening behaviour, as well as offences relating to fraud and tax. That was only in 2019, which I believe was after the matters mentioned by the right hon. Gentleman. We need those measures, and through the new consultations we hope to build a regulatory framework that is more powerful and can hold people to account.

In Darlington, more can be done. My hon. Friend the Member for Stroud noted that there are also good firms out there. It is important that the regulations help those good firms to carry on and deliver for us. We are bearing down on firms that act illegally, and we are doing more to crack down on this crime. We will continue to apply increased pressure. We hope that the waste carrier reforms and digital tracking will be in place by 2023-24, as long as the IT development and transition needs of businesses have been met.

It is important that people understand that the whole suite of measures, such as extended producer responsibility, will help to address issues such as mattress mountains. It also takes the will of us all, whether businesses or individuals, to check who is taking our waste away; it takes councils using the measures that we are giving them to enforce further; and it takes me ensuring that I am listening and that we are working towards more rigorous enforcement.

By tackling waste crime and poor performance in the waste industry, not only do we prevent harm and the blight on people’s lives and the environment, but we ensure that resources are properly recycled or recovered and fed back into the economy. In the long term, the Government are committed to minimising the impact of environmental waste by reducing the amount of waste created and managing it safely. I thank the hon. Member for Edinburgh North and Leith (Deidre Brock) for her offer to work together on this. I take the issue as seriously as every Member here does, and I will work with all hon. Members to continue to address it.