A report published yesterday on the Landfill Tax Credit Scheme revealed concerns over whether the landfill side of the waste industry – from which the credits originate, really “has too much influence over the scheme.”
The committee questioned whether the industry, “really has an incentive to fund projects such as recycling.”
Other concerns highlighted in the report targeted a lack of administrative clarity and transparency and a need to improve regulation, which is currently undertaken through ENTRUST, the private company appointed by the Government to regulate the scheme.
The report also repeated an earlier official view that: “the Landfill Tax Credit Scheme is innovative and has complex administrative and oversight arrangements” and that “a lack of overall accountability for the Scheme and a lack of transparency” existed.
Responding to the report, ENTRUST – the body responsible for regulating the environmental tax credits scheme – said it considered it is becoming a more open and transparent organisation.
“For example, there’s a lot more of our Board minutes available on the internet,” said Stephen Newton, media relations officer.
Mr Newton added: “It was good to see that a recent Guardian article acknowledged that the organisation was no longer dominated by the waste industry. We’ve recruited directors with a wider experience now.”
The PAC report also looked at the evaluation of schemes. It said: “No arrangements exist for evaluating the success of individual projects or of the Scheme overall.” And on government responsibility, the committee said arrangements should be put in place to give “lead responsibility to one Department”.
Costs
On costs, the report stated: “Administrative costs of the Scheme, averaging 9% excluding expenditure by Customs, are not out of line with others, such as the National Lottery Commission.
“Customs accept it would have been simpler to collect the tax and fund environmental projects through grants, but this would have removed the private sector status of the Scheme and reduced local schemes and decision making. There is a balance to be drawn between costs and effectiveness, but we would like to see benchmarking of the administrative costs built into Customs’ regular oversight of ENTRUST or any successor arrangements.”
ESA
Responding to the report, ESA chief executive Dirk Hazell said:”We are disappointed the Select Committee did not speak to ESA as the representative body of the industry the Committee so frequently mentions. Had it done so, the Committee might have garnered helpful information about the governance of ENTRUST and the ESA Code of Conduct on the Landfill Tax Credit Scheme.”
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