The Landfill Communities Fund was introduced alongside the Landfill Tax in 1996 and allows landfill site operators to claim a credit against their landfill tax liability for voluntary contributions made directly to environmental bodies.
Environmental bodies then use these contributions to fund a variety of projects such as maintenance or improvement of public amenities and conservation of species or habitats.
The Landfill Communities Fund has provided £1.2 billion in total funds for community projects since 1996 but, according to the Treasury, figures show that environmental bodies had accumulated large amounts of unspent money and that “money was not reaching communities as quickly as it should”.
Unspent
The government therefore challenged environmental bodies to reduce the amount of unspent funds by 15% by April 2012, which was extended to 25% by April 2014. New figures show that overall environmental bodies have not met the government’s challenge to reduce their unspent funds by 25% by April 2014, with funds only being reduced by 17%.
In an announcement issued yesterday (September 8), the Treasury said it was therefore important to “ensure it reaches the communities and projects it is designed to support.”
The government will now consider different options in consultation with landfill site operators, environmental bodies and their regulatory body, ENTRUST to improve the flow of funding to communities.
The intention to amend the Landfill Communities Fund comes six months after the Chancellor reduced the cap on contributions by landfill operators into the fund from 6.8% to 5.1% of total landfill tax returns (see letrecycle.com story). At the time, the Treasury said that the reduction took account of ‘progress’ made to reduce unspent funds.
A spokeswoman for the SITA Trust, which allocates money from SITA UK’s landfill tax receipts and exceeded its target to reduce unspent funds, welcomed yesterday’s announcement from the Treasury but highlighted that unspent money was often allocated already.
She said: “It is good that the Treasury is interested in this – it is a really important fund. It supports projects which are not necessarily that exciting but make a huge difference to communties.
“But when they talk about unspent funds a lot of that money is allocated and tied up, waiting to be spent. We only find out at the beginning of April how much we are going to get. The ideal change would be for the Treasury to announce the diversion rates for the next couple of years so we could do more forward planning.”
ESA
Commenting on the announcement, Barry Dennis, director general of the Environmental Services Association, said: “Through ESA I was involved in setting up the Communities fund scheme in 1996, and we are pleased that it has successfully benefited community projects to the tune of £1.2 billion since it was launched.
“We will follow the review with interest to see how it plans to speed up the flow of funding to communities which of course will be a benefit.”
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