Some solutions proposed
Some years ago the Money Advice and Budgeting Service (MABS) identified refuse collection charges as a cause of indebtedness for some of their clients. In 2003 the Combat Poverty Agency (CPA), at the behest of MABS, prepared a report "Waste Collection Charges and Low-Income Households". This report highlighted the need for a uniform approach to the application of waiver arrangements for waste collection charges for low-income households. It recommended the introduction of a national waiver scheme to be administered by local authorities, which would apply to all waste collection operators (public and private). It called for Guidelines to be drawn up by the Department of the Environment, Heritage and Local Government, in consultation with the Department of Social and Family Affairs, Combat Poverty Agency, MABS and community and voluntary sector representatives. The report was submitted to the Department of Social and Family Affairs and the Department of the Environment, Heritage and Local Government for consideration of its recommendations.
In 2005 the Combat Poverty Agency produced a further report "Implementing a Waiver System:Guidelines for Local Authorities". That report highlighted a number of issues, in particular:
- The conflict which often exists between environmental and social policies;
- The need to poverty proof all policies at both design and implementation stage;
- Problems posed by the increasing privatisation of public services for those who cannot afford to pay for them.
The Report included a set of proposed guidelines for use by local authorities nationally to structure waste charging systems, including waiver systems. While promoting the guidelines as a means of achieving consistency across local authority areas in the short term, the report called for the introduction of a universal waiver model that would satisfy the guidelines at a national level. Three such options were identified and analysed in the report – a tax credit system implemented nationally via the existing taxation system; a locally operated system to be implemented via local authorities; and a national waiver scheme delivered through the social welfare system.
The report concluded that a locally operated waiver system would offer the most effective delivery model and that consideration should be given to centralised funding of the waiver scheme, with grants given to local authorities for its operation.
Comments of the Society of St. Vincent de Paul
In response to my Office’s invitation, the Society of St. Vincent de Paul made a submission to this investigation in relation to waste management costs for low-income families. I do not propose to repeat the entire submission here but the following selected comments are particularly relevant. The full text is at Appendix 6 to this report.
SVP is concerned that many low-income households are experiencing poverty due to the waste charges structure in a number of local authorities. There have been significant increases in waste charges in recent years coupled with a growing shift toprivate sector providers, whose main concern is cost effectiveness rather than protecting low-income households from unnecessary financial burdens. Private operators are under no obligation to provide a waiver scheme. Operational aspects of waste management policy are decided upon at local Government level, resulting in different systems operating in different counties.
The current Pay by Volume / Pay by weight systems, while having clear environmental merits, pose a number of key problems and anomalies:
- some local authorities have a standing charge (recycling service included in this) and any refuse pick-up is an additional cost;
- some have no standing charge and sell bags for waste, with a recycling service as an optional extra to pay for on top of the bag system;
-while some people on social welfare are entitled to a waiver, others in a neighbouring county – or even a neighbouring estate - may not be; and
- payment methods often do not assist the budgeting behaviour of low income households.
At the local level, Conferences of the Society of St. Vincent de Paul provide financial assistance as a direct result of the hardship caused by lack of appropriate support with domestic waste charges. The SVP Conference has found it necessary to help clean out back gardens, and have helped with the replacement of stolen bins also. It is worth noting that for volunteers such work is very difficult and the conference can no longer assist in such demanding physical work.
If a single old lady (pensioner) lives in an apartment and puts out waste contained in a couple of small supermarket plastic bags per week she gets charged the same amount annually as her neighbour who might be a couple with two children on either social welfare or with one partner working at least.
Consequences of the Present System
Through the work of our volunteers the Society sees at first hand the direct consequences for individuals and families of the present system. These include rubbish building up in peoples’ back gardens leading to public health concerns, dangers for children, neighbour unease, and potentially anti-social behaviour. Having to pay full charges also has an impact on other household discretionary budgets such as food / clothing / entertainment. It is also worth recording the experience of Medical Burns Units who have mentioned the increase in burns due to the burning of household rubbish.
In order to try and deal with these issues the Society has paid for the costs of private skips, the costs of cleaning out houses and vermin control. At local level the Society has also come to arrangements with Local Authorities and Private Waste Collectors.
The Conundrum of Private Waste Collection
The majority of local authorities use the private sector to deliver waste management services to at least some extent in their counties. Waste collection permits are the means by which local government regulates private waste companies. Unfortunately, the waste collection permits fail to make mandatory the following: any aspect of pricing, payment policy or consumer protection (in contrast to essentially all other aspects of the waste management issue). As a direct result, we believe the majority of areas under private provision do not provide any form of income protection to poorer households. In counties where this is the case, SVP is very concerned about the barriers in establishing a system which protects low-income households while encouraging the reduction of household waste.
What SVP want
We believe that Government should allocate adequate resources for a consistent, country-wide system to assist those on low income - on both social welfare and low wage incomes - with their domestic waste costs. We believe that this can be done while continuing to encourage those households to recycle where possible.
Comments of the Irish Senior Citizens Parliament
In response to my Office’s invitation, the Irish Senior Citizens Parliament made a submission to this investigation. I do not propose to repeat the entire submission here but the following selected comments are particularly relevant. The full text is at Appendix 7 to this report.
At present many pensioners live at risk of poverty. Half of all pensioners are solely dependent on the state pension (CSO, 2007) and extra costs like waste charges erode their real income. The system is inequitable as some local authorities operate a waiver scheme and others do not. We can find no justifiable reason for this inconsistency other than the fact that it seems to be the result of uncoordinated policy-making. Simply put, no consistent national waiver system has been developed. The result is that older people in some areas benefit from a waiver, while many more do not.
Of the 34 local authorities surveyed on this issue last year, just half operated a waiver scheme. 1
1 O’Callaghan-Platt and Davies A. (2006) ‘A Nationwide Review of Pay-By-Use (PBU) Domestic Waste Collection Charges in Ireland: Extensive Survey Findings (2005-WRM-MS-33) Interim Report Wexford: EPA
Where a waiver scheme does operate, there are inconsistent means of accessing the waiver. Some local authorities demand that older people apply for a waiver, undergo a means test or make an individual hardship case. Older people who are most at a disadvantage are those who have no waiver and must meet a large annual charge.
To address this concern, the Irish Senior Citizens Parliament would like to make two simple recommendations to government:
1. Implement a national waiver system for waste charges ensuring that all pensioners are entitled to a waiver on waste charges.
2. Make this waiver part of the existing Household benefits package.
Comments of the Department of the Environment, Heritage and Local Government (the Department)
In response to my Office’s invitation, (see Appendix 8) the Department made a submission to this investigation. I do not propose to repeat the entire submission here but the following selected comments are particularly relevant. The full text is at Appendix 9 to this report.
Waste management services have traditionally been provided at a local level, with individual arrangements being locally determined and tailored to local circumstances. The present legal framework, as determined by the Oireachtas, reflects this. In accordance with section 52 of the Protection of the Environment Act 2003, the determination of waste management charges, and any associated waiver scheme, is a matter for the relevant local authority, where it acts as the service provider. Similarly, where a private operator provides the collection service, it is a matter for that operator to determine charges.
...in regard to waiver schemes in respect of these charges, it is a matter for the local authority concerned to determine the nature and extent of any such scheme in the case of services provided by itself. Generally speaking waiver schemes do not operate in respect of privately supplied collection services. There is legal advice to the effect that such a scheme is not legally provided for in circumstances where the private sector are providing the service. However, where a local authority enters into an arrangement with a private operator to provide a service to certain households a waiver scheme can apply. Local authorities have been asked by the Department to engage with commercial waste collectors to agree on arrangements to assist lower-income households by offering alternative payment methods to an annual lump-sum.
In a broader setting the issue of waste charges and low income persons/households has been raised in the Social Partnership context. The community and voluntary sector have argued that low-income households in areas serviced by private waste collectors are treated inequitably in comparison to those receiving waivers from localauthorities; that they are also treated inequitably in comparison to higher income households in the same areas, as the latter can avail of tax relief on their waste charges; and that real hardship arises in certain cases as a result.
Discussions have taken place between the Department and the Department of Social and Family Affairs in response to the issues raised. It did not prove possible however to identify a mechanism to address the issues raised through the social welfare system.
The Combat Poverty Agency report again raised the issues surrounding the operation of waiver schemes in certain areas but not in others. The report fully acknowledges the centrality of the polluter pays principle and that incentives should exist for all households to control waste generation and maximise recycling…Essentially the authors look at possible models for delivering what they would regard as a more nationally equitable waiver system and come down on balance in favour of one… Ultimately the report comes down in favour of the locally based system as against the social welfare system.
The issue of waiver schemes was considered by Dail Eireann in February 2005 in the context of a motion which was not carried and which called for the introduction of a National Waiver Scheme.
The switch to use based charges over the past few years is intended to reward those who generate least waste and who are most active in recycling. The precise charging mechanism in any given area will inevitably be fitted to local circumstances, local costs and available technology.
In regard to the waiving of such charges, each individual local authority has the power to make a waiver scheme where it is the service provider, or to make appropriate arrangements with the private sector, where it is not. In this way local solutions can be tailored to local circumstances with proper application of the subsidiarity principle. Ideally any such arrangement should also reflect the polluter pays principle and incorporate an incentive to recycle waste, though historically this has not been the case.
In practice, waiver schemes are generally available where the local authority provides the service directly. Where services are provided by private collectors, local authorities have the power, under existing provisions, to make special arrangements in the case of hardship if they consider it necessary. Some local authorities do so, although on a very limited scale.
There is one further development which is relevant to this issue. A public consultation has concluded on issues surrounding the overall regulation of the waste management sector. Stakeholders and the general public were invited to make submissions on whether there is a need for a regulator for the sector, on what model of regulator might be most appropriate and on what powers any such regulator should be given. Among the possible powers identified is the power to impose a public service obligation. This is a feature of regulation in some other sectors, and effectively requires contractors to operate cross-subsidisation so that services can be provided where they would not otherwise be economically feasible. The various submissions received and the issues raised will be considered further in the context of the review of waste management generally provided for in the Government’s policy programme and which will shortly be initiated.
To summarise the position then, it has never been the practice for central Government to determine operational matters in regard to waste management. Waste management is a service that is one of the oldest provided by local authorities. It is the Government’s view that, working to national and EU environmental standards, local authorities should be free to tailor services to local needs and that a local approach to the determination of charges, and any waiver of such charges, is consistent with this.
Comments of the Department of Social and Family Affairs (the Department)
In response to my Office’s invitation, (See Appendix 10) the Department made a submission to this investigation. I do not propose to repeat the entire submission in this report but the following selected extracts are particularly relevant. The full text is at Appendix11 to this report.
This is very definitely a local issue and local authorities have all the necessary powers to operate waiver schemes in their areas. Indeed, some local authorities already operate good waiver schemes and not just those where the refuse collection service is provided directly by the local authority. In some areas private contractors are involved in a waiver scheme. Minster Cullen reinforced this point recently in a recent Dáil debate on the issue:
"The local authorities have all the necessary powers to operate waiver schemes in their areas. It is a matter on which local councilors in the local authorities should make the decision. They can do it by involving themselves in the estimates process."
It has been suggested that this Department could respond to the issue of waste charges through the exceptional needs payments of the supplementary welfare allowance scheme. Under this scheme a single payment may be made to help meet essential, once-off, exceptional expenditure, which a person could not reasonably be expected to meet out of his or her weekly income. The payments are for such items as bedding or cooking utensils for someone setting up a home for the first time or costs relating to funerals, or visiting relatives in hospital or in prison. This scheme is not intended to meet the cost of regular household bills.
This Department is responsible for the Household Benefits Package (formerly known as the Free Schemes) which provides recipients with assistance with their gas/electricity and telephone costs and covers the full cost of a television licence. The possibility of extending this package to cover other socially desirable goods, which could include waste charges, has been considered. The Review of the Free Schemes carried out in 2000 explained that other State agencies and indeed local authorities can introduce their own similar schemes if they wish as follows:
"While recipients consider the Free Schemes to be very valuable, there is continual pressure to extend these schemes to other socially desirable goods. Any new schemes would add to that pressure and divert resources from other areas such as increasing the basic rate of payment. However, there is nothing to preclude other State agencies introducing their own schemes, such as Local Authorities extending Free Dog Licences, as part of their wider social obligations. Many private companies already extend concessions to pensioners in order to increase their business usage, as part of their social aims and as recognition of the value they have received from their customers over the years. It is not the business of the Department of Social, Community and Family Affairs to provide for all socially desirable items of expenditure, even if there was agreement on what those items of expenditure might be”.
In any event, the introduction of a national social welfare scheme to address the issue of waste charges would not be feasible given the wide range of charging regimes and cost structures that exist in respect of waste management throughout the State. Any system put in place to assist people with waste collection charges would have to take account of the different local arrangements.
As you mention, the CPA report considered the various options for waste charging delivery models... The report concluded that, if a suitable procurement approach could be developed, the locally operated waiver system would offer the most effective delivery model and this Department is in agreement with that consideration.
There have been some discussions between officials from this Department and colleagues in the Department of Environment, Heritage and Local Government on this issue. That Department is aware of our position.
Comments of the local authorities
As part of the questionnaire local authorities were asked for their views as to whether they should provide a waiver to customers of private operators. The following are some of the responses received:
- it would be impossible to manage a scheme which provided waivers to customers of private operators;
- local authorities should not be involved in waiver schemes for private waste collection;
- extending the local authority waiver scheme to include customers of private operators would weaken the competitive position of the local authority;
- extending the waiver scheme to customers of private operators would only serve to increase the annual charge for paying local authority customers;
- the Council service is available to all households in the city, so if a customer chooses to use a different operator we see no reason to extend the waiver scheme to them;
- where the collection is privatised there is no way the Council can provide any form of waiver, it simply is not practical or economic;
- the Council receives no subvention from Central Government for the implementation of the waiver scheme; in addition to the door to door household collection, the Council operates a Civic Amenity Centre where a wide range of waste items are accepted free of charge from the public, and many Bring Banks for glass, cans, old clothing etc. None of the private operators provide any such additional services. The provision of a waiver for customers of private companies is a matter for the companies involved;
- if the waiver scheme was recognised by the State with no loss accruing to the local authority (such as with the Free Travel Pass Scheme, Free Electricity) then the Council may consider offering a waiver to customers of a private collector.
The questionnaire also invited the local authorities to provide any general comments that they felt might be relevant to this report. A representative selection of those comments have been grouped together under some general headings as follows:
Calls for a National Waiver Scheme
- subsidies/waivers should be provided nationally through the Social Welfare system in the same manner as other schemes for low-income households, rather than as a burden on the Council’s resources;
- the waiver issue has been considered at Strategic Policy Committee level and is deemed to be a matter for the Department of Social and Family Affairs (DSFA);
- a national waiver system is the best solution in the interests of fairness and equity;
- national guidelines are essential to ensure a consistent approach countrywide; these should be drawn up by the Department of the Environment, Heritage and Local Government, in conjunction with DSFA, D/Finance, and groups such as MABS, Combat Poverty and community and voluntary sector representatives;
- a national waiver system should be funded through the Department of Social and Family Affairs;
- a nationally administered waiver system may provide the best solution ; a notice of motion has been passed in this Council calling on “the Minister for Social and Family Affairs to draw up National Guidelines for implementation of a waiver scheme in line with the recommendations contained in the Combat Poverty report;
- the cost of a national scheme should be borne at central government level as is the case with Free Travel, Free TV Licence, Free Fuel Allowance, Free Electricity ;
- a national scheme which provides for a partial waiver of the fixed charge element only would comply with the polluter pays principle and still provide an incentive to reduce the volume of waste being disposed of.
Resource Issues:
- local authorities lack the resources to provide a waiver scheme which would be equitable to all low-income households;
- the resources of the local authority are used to fund the waiver scheme and if costs were to be passed to the paying customer it would make the service non-competitive;
- private operators are not required to provide a waiver, therefore, local authorities are at a disadvantage;
- the provision of a waiver scheme is a very heavy cost on local authority resources and makes it impossible to provide a waste collection service which is self funding;
- the waiver scheme is open to abuse but the Council would require additional resources to carry out more spot checks;
- an equitable and adequate basis for funding schemes such as the refuse waiver scheme must be devised and implemented.
Administration Difficulties
- many individuals do not apply for a waiver in a timely manner; applications for a number of years can be sent in at the same time and usually only when the service has been withdrawn due to lack of payment;
- the reliance on third party information (e.g. social welfare statements) is not totally satisfactory.