Waste Managment Profit Improvement Services Chartered Accountants London UK

Winters Chartered Accountants and Registered Auditors
29 Ludgate Hill
London EC4M 7JE
England, UK

Tel:
+44 (0) 20 7919 9100

Fax:
+44 (0) 20 7919 9019

Profit Improvement - Topical Articles

Winters Profit Improvement Service- Waste

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Waste costs go up and up for UK businesses

UK businesses face higher bills and stiffer restrictions on disposing of their waste under regulations that came into force on 16th July 2005. However, less than a third of small and medium sized businesses are aware of the new rules about handling hazardous waste, according to a survey carried out recently by the Environment Agency.

The new regulations mean 200 forms of waste are newly classified as hazardous, so many companies will find themselves producing hazardous waste for the first time. Previously ‘harmless’ waste that may now fall foul of the law include oily rags, paint, computer monitors, keyboards and batteries. Any waste included in the new list can no longer be thrown away with the usual rubbish but will need to be separated and consigned to properly authorised sites or disposed of by specialist services. If a company uses a contractor to deal with their waste, liability for compliance will still rest with them, all of which will push up the costs of many UK businesses and will add to the burden of red-tape and administration.

Under the new regulations, most businesses that create waste falling into one of a range of categories designated as ‘hazardous’ will need to register with the Environment Agency to obtain a unique ‘premises code’. Certain types of premises are exempt from the requirement to register if they produce less than 200kg of hazardous waste at specified premises in any twelve month period but for non-exempt premises failure to do so could have serious consequences. Waste carriers will not collect waste from an unregistered producer and ultimately, failing to register is a prosecutable offence.

What’s more, some newly hazardous wastes (such as TVs and fluorescent light tubes) will also be subject to the Waste Electronic and Electrical (WEEE) Directive, which will come into force in 2006. The main aim of this directive is to reduce the amount of waste going to landfill by requiring all manufacturers and producers to take responsibility for what happens to the products they sell at the end of their lives. Accompanying the WEEE Directive is another layer of regulation known as the Restriction of Certain Hazardous Substances (RoHS) Directive. This limits the use of certain toxic substances, such as lead, in printed circuit boards and will further add to the costs associated with waste for many companies.

Liz Parkes, Head of Waste Regulation at the Environment Agency, said: "The new rules will mean that there will be more businesses producing hazardous waste. The results [of our survey] show that many are not aware that their waste is hazardous and must be managed very carefully. With regards to enforcement, we will be targeting our routine checks where we can have the greatest impact. We will continue to come down hard on anyone that knowingly flouts the rules."

Charity Shops

A chain of 9 charity shops was paying £20,000 per year for waste collections from their shops and a further £10,600 from its furniture warehouse. Following a review of procedures and costs, we implemented savings of £11,050 (55%) on the shops and £1,590 (15%) at the warehouse.

Savings Table

Category % saving £ saving

Shops 55% £11,050

Warehouse 15% £1,590

TOTAL £12,640

A Garage

A garage spending £4,680 per year on the collection of waste tyres saved £1,400 or 74% over a five-month period after Auditel identified and implemented a change of contractor and new on-site practices.

Savings Table

Category % saving £ saving

Collection of waste tyres 74% £1,400

Landfill Tax

Landfill tax is paid on top of normal landfill fees by businesses and local authorities that want to dispose of waste using a landfill site. There are two rates of tax:

the lower rate – £2 per tonne for inactive waste such as rocks and soil
the standard rate – £18 per tonne for all other land filled waste

The government has stated that the standard rate of tax will increase by at least £3 per tonne in subsequent years to a rate of £35 per tonne by 2010. This means that the costs associated with every tonne of waste that goes to landfill will increase by at least 94% over the next 5 years. The landfill tax is designed to encourage businesses to produce less waste and to use alternative forms of waste management.

Please address any profit improvement queries to Ian Warwick at Ian.Warwick@winters.co.uk or Gill Gibbon at Gill.Gibbon@Winters.co.uk in the first instance.

Further details of Winters Profit Improvement Service can be found on our Profit Improvement page. There may be a range of costs that we can help you better manage.

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