The proposals put forward by the EA aim to provide full regulatory cost recovery for operating the WEEE compliance system.
On the 30 November the Environment Agency Charge Proposals Consultation was launched, outlining a review of charges across a number of regimes and services. This is part of a programme of work called the Strategic Review of Charges to reform the EA charging schemes for 2018-23.
Their aim is to ensure that charges are in place that ‘work better for business and the environment, reduce reliance on grant in aid income from the taxpayer, and are financially sustainable.’
A significant shortfall
Part of this review focuses on the WEEE compliance system which costs the EA in the region of £2.7M per year to operate, yet they only recover approximately £1.3M per year through the system – a significant shortfall.
In the report the EA explains that ‘Both the regulatory costs and the more significant recovery/recycling costs in the WEEE system are ultimately borne by Electrical and Electronic Equipment (EEE) producers, and we are proposing that this group will pay the bulk of costs as the main beneficiaries of our regulatory activity as we move to a full cost recovery position.’
As such they propose only a ‘modest increase’ in charges for Approved Authorised Treatment Facilities (AATFs) and Approved Exporters (AEs).
Impact of the proposed charges
The proposed measures to recover the full costs of operating the WEEE system impact the following three groups:
It is proposed that large producers (placing more than five tonnes of EEE on the market) will pay a single charge of £800. It is anticipated that this will simplify the information required at registration and will provide a more even approach to all EEE producers who are required to register. The biggest shock to a producer could be for a non-VAT registered large producer who would see an increase from £30 to £800.
Small producers (placing less than five tonnes of EEE on the market) would see no change from the current fee of £30.
To avoid the risk of producers migrating to compliance schemes who are approved by the other UK environmental agencies who may have lower registration charges, Defra is also consulting on introducing a regulatory amendment that would require all large producers to pay the registration charge applicable to them, based on where their principal place of business is.
Proposed charges for large AATFs and AEs (that issue more than 400 tonnes of evidence each year) will increase from £2,570 to £3,500, and small AATFs and AEs (that issue 400 tonnes or less of evidence each year) would see charges increase from £500 to £600.
The charge payable by an exporter if they add an additional overseas export site to their approval will rise from £110 to £150 for each request.
The EA propose to introduce an annual subsistence charge of £12,500 for compliance schemes, whilst retaining the current one-off scheme approval fee of £12,150.
Ensure fees are distributed fairly
Robbie Staniforth, commercial manager commented “We’ve been aware of a funding shortfall at the Environment Agency and will be looking closely at the proposals to ensure fees are distributed fairly across producers, schemes and treatment operators.”
“However, the grim reality is that the agency need to collect nearly twice as much just to maintain their existing activities. It is unfortunate that the consultation does not contain details on how these funds will be deployed.”
Ecosurety is taking an active role in stakeholder discussions with the EA whilst they consult on these proposals.
The response survey can be accessed here and the consultation closes on the 12 January 2018.
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This webinar is CPD accredited.