UK given resource warning

19th September 2012


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Resource shocks will become more frequent and damaging to the UK economy unless the government takes urgent action on the pending raw materials crisis facing the country, warns a group of business and environmental organisations, including IEMA

In a letter to both the environment and business secretaries, the Material Security Working Group (MSWG) warns that if the UK does not develop a stronger strategy to keep valuable raw materials circulating in the economy there will be significant consequences for UK industry.

The group, which also includes the manufacturers’ organisation EEF and Friends of the Earth (FoE), claims increasing global demand – which will soar further as the population rises – coupled with rapidly degrading ecosystems is already putting pressure on supplies of some raw materials. According to the MSWG, the cost of raw materials has risen substantially in recent years.

“In future a greater number of materials – from wood, plastic and rubber to the rare earth metals used to make everyday electronic products and low-carbon technologies – are likely to be increasingly costly,” says the MSWG.

It cites the findings of a recent survey of businesses by the EEF, which reveals that 80% of senior manufacturing executives believe limited access to raw materials is already a business risk and a threat to growth, with one in three saying it is their top risk.

The letter is the group’s response to the publication by Defra earlier this year of a resource security action plan (RSAP). Although the MSWG describes the plan as a “welcome first step”, it wants the government to go further, saying the RSAP fails to address the wider challenge of the future: using resources as efficiently as possible while living within environmental limits.

“The government’s RSAP falls short of meeting the challenges we will face when obtaining new resources becomes more difficult and costly,” commented Gareth Stace, head of climate and environment policy at the EEF.

“[The] government must now step up its ambitions and produce a bolder plan of action that deals with the challenges, not just now but in the longer term. This is vital, not just from an environmental perspective but to ensure a long-term sustainable future for manufacturing and the wider economy.”

Among the recommendations put forward in the letter is the creation of an office of resource management in the business department (BIS), which would coordinate activity that is currently spread across several departments and agencies, including Defra, BIS, DECC, the Environment Agency and WRAP.

“A new office of resource management would ensure all departments create jobs and boost the economy by slashing the waste of natural resources,” said FoE resource campaigner Julian Kirby, who points out that the UK currently buries and burns at least £650 million worth of valuable materials a year.

Other suggestions include reviewing the packaging and producer responsibility regimes and realigning recycling targets to better reflect the quality of recovered waste. The MSWG argues that the packaging recovery regime incentivises the export of valuable waste overseas. It wants the government to consider setting separate targets for domestic and exported recovery and, potentially, lowering the value of export packaging recovery notes.

It also supports a rethink of producer responsibilities, suggesting that ministers consider offering rewards to electronics manufacturers that design products that are easier to recycle and reduced VAT rates for resource-efficient products.

Meanwhile, in an interview with the environmentalist, EU environment commissioner Janez Potonik warns: “When we use resources inefficiently, we open ourselves to fluctuations in their price and supply conditions. So in the end it’s the economies that use resources more efficiently that are most competitive.”

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