UK PLASTICS INDUSTRY
Leading associations call on government to reduce tax on energy-efficient building products and shale gas exploration / Propose higher landfill tariffs and warn about rising energy costs
Led by the British Plastics Federation (BPF, London / UK; www.bpf.co.uk), the so-called Seven Associations Alliance has written a letter to UK Chancellor of the Exchequer George Osborne, outlining several proposals for his March budget statement. Representing some 310,000 employees spread across 6,100 companies, the industry groups made a number of recommendations to the minister of parliament, including reducing the VAT rate of energy efficient products such as EPS insulation and PVC-U double glazing, used in building and construction, to 5%. Furthermore, regarding energy-efficient building, the associations called for a complete review of the “Green Deal” incentive for energy efficient improvements, calling the payback “unattractive” and the scheme itself “complex”.
On the issue of shale gas, the Seven Associations Alliance welcomed Osborne’s fall 2013 statement on reducing the tax rate for shale gas exploration, giving companies the option of offsetting 75% of their spending on exploration against future profits – for more details, see Plasteurope.com of 12.06.2013. Aside from providing raw material for the country’s chemicals and plastics industries, shale gas exploration will also create new jobs, the associations said, while cautioning that, “We must ensure the energy and material is not simply exported when this comes on stream in the 2020s”.
Tying into the issue of energy supply, the groups expressed concern that the UK might not be able to meet its energy demands this coming winter, pointing out that 10% of the country’s power generation facilities have already been closed without any replacement. In their letter, they urged the chancellor to act with more urgency to ensure that energy costs for the industry are kept low and affordable while simultaneously speeding up power generation capacity, including by means of generating energy from waste. The latter, they said, could provide up to 11% of the UK’s power needs. In addition, the groups called for more gas storage capacity across the country.
Another issue the associations commented on was landfill tax, pointing out that while the government plans to raise the standard rate to GBP 80/t, it needs to reach GBP 200/t by 2020 at the latest, to encourage the collection of recyclable waste and prevent it from ending up in landfill. “The UK is among the worst in the EU for relying on landfill,” the groups said, adding that a diversion away from final waste would bring back into use valuable resources. Additional funds generated by a rise in landfill tax could be used, the Seven Associations Alliance said, to stimulate investment in recycling and energy from waste, among others.
In addition to calling for better finance conditions for small and medium-sized businesses, a freeze or cut on business rates as well as an extension to the GBP 250,000 tax free allowance for companies to upgrade equipment and expand production, the groups also pointed Osborne’s attention to the lack of skilled staff, which they said was severely hindering industry growth. Up to 4m engineers are set to retire across the UK in the coming eight years, but universities only produce about 25,000 engineers each year. To make up for this gap, the alliance has called on the government to consider reducing tuition fees for certain science and engineering courses.
The letter also once again addresses the ongoing debate about the proposed 5p charge on plastic carrier bags, which the associations called “knee-jerk gesturism”. Plasteurope.com has reported extensively on the issue; for most recent coverage, see Plasteurope.com of 13.02.2014. Before concluding their letter to the chancellor, the associations write they “hope the government will withdraw this proposal and steer clear of other similar flawed ideas”.
In addition to the BPF, the Seven Associations Alliance is made up of the Packaging & Films Association (PAFA, Nottingham / UK; www.pafa.org.uk), the British Coatings Federation (Leatherhead, Surrey / UK; www.coatings.org.uk), the British Rubber and Polyurethane Products Association (BRPPA, Colchester, Essex / UK; www.brppa.co.uk), gtma (West Bromwich, West Midlands / UK; www.gtma.co.uk), the Scottish Plastics & Rubber Association (Edinburgh, Scotland / UK; www.spra.org.uk) and the Northern Ireland Polymers Association (Belfast, Northern Ireland / UK; www.polymersni.com).
On the issue of shale gas, the Seven Associations Alliance welcomed Osborne’s fall 2013 statement on reducing the tax rate for shale gas exploration, giving companies the option of offsetting 75% of their spending on exploration against future profits – for more details, see Plasteurope.com of 12.06.2013. Aside from providing raw material for the country’s chemicals and plastics industries, shale gas exploration will also create new jobs, the associations said, while cautioning that, “We must ensure the energy and material is not simply exported when this comes on stream in the 2020s”.
Tying into the issue of energy supply, the groups expressed concern that the UK might not be able to meet its energy demands this coming winter, pointing out that 10% of the country’s power generation facilities have already been closed without any replacement. In their letter, they urged the chancellor to act with more urgency to ensure that energy costs for the industry are kept low and affordable while simultaneously speeding up power generation capacity, including by means of generating energy from waste. The latter, they said, could provide up to 11% of the UK’s power needs. In addition, the groups called for more gas storage capacity across the country.
Another issue the associations commented on was landfill tax, pointing out that while the government plans to raise the standard rate to GBP 80/t, it needs to reach GBP 200/t by 2020 at the latest, to encourage the collection of recyclable waste and prevent it from ending up in landfill. “The UK is among the worst in the EU for relying on landfill,” the groups said, adding that a diversion away from final waste would bring back into use valuable resources. Additional funds generated by a rise in landfill tax could be used, the Seven Associations Alliance said, to stimulate investment in recycling and energy from waste, among others.
In addition to calling for better finance conditions for small and medium-sized businesses, a freeze or cut on business rates as well as an extension to the GBP 250,000 tax free allowance for companies to upgrade equipment and expand production, the groups also pointed Osborne’s attention to the lack of skilled staff, which they said was severely hindering industry growth. Up to 4m engineers are set to retire across the UK in the coming eight years, but universities only produce about 25,000 engineers each year. To make up for this gap, the alliance has called on the government to consider reducing tuition fees for certain science and engineering courses.
The letter also once again addresses the ongoing debate about the proposed 5p charge on plastic carrier bags, which the associations called “knee-jerk gesturism”. Plasteurope.com has reported extensively on the issue; for most recent coverage, see Plasteurope.com of 13.02.2014. Before concluding their letter to the chancellor, the associations write they “hope the government will withdraw this proposal and steer clear of other similar flawed ideas”.
In addition to the BPF, the Seven Associations Alliance is made up of the Packaging & Films Association (PAFA, Nottingham / UK; www.pafa.org.uk), the British Coatings Federation (Leatherhead, Surrey / UK; www.coatings.org.uk), the British Rubber and Polyurethane Products Association (BRPPA, Colchester, Essex / UK; www.brppa.co.uk), gtma (West Bromwich, West Midlands / UK; www.gtma.co.uk), the Scottish Plastics & Rubber Association (Edinburgh, Scotland / UK; www.spra.org.uk) and the Northern Ireland Polymers Association (Belfast, Northern Ireland / UK; www.polymersni.com).
27.02.2014 Plasteurope.com [227661-0]
Published on 27.02.2014