The fee is an alternative mechanism that compliance schemes and obligated business can use if they have insufficient recycling evidence to meet their WEEE collection targets for the year. Targets are usually met through acquiring evidence of recycling for material collected at civic amenity sites.
Compliance fees have been used for the two previous years – 2014 and 2015 – although on both occasions methodologies proposed by the Joint Trade Associations were used to calculate the fees.
JTA also submitted a methodology for the 2016 compliance year as well as an alternative proposal put forward by the Environment Exchange (T2E). But, Defra ministers have opted instead to use the proposal submitted by Valpak. Administration of the fee will be overseen by accounting firm Grant Thornton.
In a bulletin to producer compliance schemes issued yesterday, the Environment Agency confirmed the selection of Valpak’s proposed methodology for 2016.
It said: “Defra have asked us to inform you that Ministers have approved the WEEE Compliance Fee proposal submitted by Valpak for the 2016 Compliance Year. The Compliance Fee will be administered by Grant Thornton. The proposal has been amended to require submission of net cost data relating only to directly collected WEEE from local authority DCFs by those Compliance Schemes using the fee mechanism.”
The approved proposal submitted by Valpak would see schemes provide direct collection and treatment cost data which will then be used to determine the level of fee to be paid, dependent on material collection streams.
Proposals
In its summary of the proposals, submitted in 2016, Valpak explained: “The basic fee should be escalated by a continuous and gradually rising factor so that schemes which are significantly below their target and need to use the fee for a greater tonnage pay a higher figure per tonne than those which require only a low tonnage. This increases the incentive on schemes to meet their collection targets without using the fee.”
Valpak also claimed that using a fee that is based on collection and treatment cost data could incentivise demand for WEEE from local authority civic amenity sites in future years – in response to concerns over a reported drop in demand in material from councils (see letsrecycle.com story). The compliance scheme claimed that there had been ‘a perception that the full costs of collecting from some authorities could be higher than the level of compliance fee set’.
On how its proposal would counter this, Valpak added: “The fee escalator is adjusted so that the impact on schemes requiring a certain tonnage is the same regardless of scheme size. Previously the escalator factor used was relatively insignificant for larger schemes but much more so for smaller schemes, meaning that the incentive for larger schemes to engage in actual collections rather than rely on the fee was lower.”
Compliance schemes have until the end of March to issue a declaration of compliance to state that they have met targets through funding WEEE evidence, or payment of a compliance fee.
Speaking to letsrecycle.com, Adrian Hawkes, director of policy at Valpak, said: “We are very pleased the government has adopted a compliance fee for this year and it is good to have our proposal for that, particularly because we think that the WEEE system benefits from an element of stability. We see our proposal as not radically different but more of an evolution, so there will be a lot of similarities but some small but important differences that we think will give a fairer result in the current marketplace.
“We see our proposal as not radically different but more of an evolution, so there will be a lot of similarities but some small but important differences that we think will give a fairer result in the current marketplace.”
Adrian Hawkes
Valpak
“We don’t know what the uptake will be and it will now be for Grant Thornton to operate the Fee and we at Valpak will have no further input.”
Usage of a compliance fee is intended to discourage PCSs from collecting volumes of WEEE significantly above their collection targets and then seeking to sell the surplus evidence to schemes seeking more evidence to meet their obligations. It was brought in as a mechanism under the 2013 WEEE Regulations.
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