Waste sector braced for Spending Review pinch

When Chancellor George Osborne announces the results of the Spending Review on October 20, setting out the coalition government's spending plans for 2011/12 to 2014/15, it's not just the public bodies involved in waste and recycling who will be waiting with baited breath to see what he has to say.

Everyone knows that cuts are coming, as the government looks to reduce the UK's growing budget deficit by reining in public spending, but question marks remain over the extent of the cuts, and exactly what they will mean for the delivery of key frontline services such as waste and recycling, and how it affect the waste sector as a whole.

Government departments, including Defra, have known since Mr Osborne's June 2010 emergency budget that they will be expected to reduce their spending by 25% by 2014/15, with knock-on effects expected for quangos such as the Waste and Resources Action Programme (WRAP) and the Environment Agency.

Meanwhile, councils have said they expect to have to make cuts of as much as 40% as a result of a reduction in their Whitehall funding.

But, waste management companies will not be immune, with those running council contracts having to work with their local authority partners to work out how they can help them to achieve those cost-savings without damaging the quality of service they offer.

There are also major question marks over the future of funding mechanisms that could potentially encourage the development of new waste infrastructure – including PFI and renewable energy subsidies, such as the Feed-in Tariff and the proposed Renewable Heat Incentive.

And, with the Spending Review taking place at the same time as a review of all England's existing waste policy, questions are already being asked about whether the processes are compatible, in particular in relation to achieving increased collection frequency alongside cutting costs.

For a full, in-depth look at what the Spending Review might mean for the waste sector, click here.