A review of statutory and other funding sources

Alex Green of FareShare argues that Defra's new BREW fund conspicuously overlooks community schemes to divert food waste from landfill.

Published 6th June 2005

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The removal of funding for initiatives that focuses on waste prevention, recycling and the use of energy from waste from the Landfill Tax Credit Scheme (LTCS) in 2004 has put enormous pressure on organisations that had benefited from this funding.

Many of the network of food redistribution projects that make up FareShare, the national food charity, had received funding from LTCS, and while it was by no means the only source of income, it did provide funds and indeed recognition of projects which focus on waste prevention; in FareShare’s case by ensuring that food, which is still fit to be eaten, is used to have a social impact by supplying it to local charities to support their work with homeless and other disadvantaged people.

FareShare, as with other prevention, reuse and recycling initiatives, found themselves looking towards Government to direct them to other potential sources of funding to replace that lost. Initially it seemed that there was a clear replacement of support. As part of the changes to the LTCS, HM Treasury allocated any future increases of the Landfill Tax Credit (now £15 but set to rise to £35) to a new fund (Business Resource Efficiency and Waste – BREW) managed by DEFRA. This optimism was unfortunately short lived when on review it was clear that FareShare was not eligible in any of the very broad areas that the new scheme would fund.

Encouragingly we now have very good, open dialogue with representatives from DEFRA. While this does not mean access to funding as yet it does mean we can take part in debates for future developments.

A number of other government grant programmes were suggested for FareShare to approach; the following highlights the range we have approached and how and why we are not eligible:

1) HM Treasury states that approximately £47 million will continue to be made available through a revised LTCS for spending on local environmental and community projects.

  • This money is still not being made available to organisations like FareShare as we do not deal with municipal or household waste. Despite the fact that we are helping to divert waste from landfill and therefore helping the Government to meet their targets, and many of the organisations that are eligible for this new money do not, we still cannot benefit from this landfill tax credit money.

    2) The Waste Implementation Programme works in partnership with local authorities to achieve a step-change in the way they manage their waste

  • This does not cover commercial waste. There does not seem to be any focus on the food and drink industry to help them manage their waste, especially as an estimated 1/3 of all waste being sent to landfill is from this sector.

    3) Paul Boateng, when Chief Secretary at HM Treasury role, acknowledged the good work carried out by FareShare and also recognises that the community sector plays a “vital role” in sustainable waste management.

  • FareShare is not a traditional community sector organisation however, and there should be some recognition that the community sector goes beyond “source-separated recycling/collection” initiatives and can provide a strategic and sustainable service to various industry sectors and can produce real results in lowering the amount of waste being sent to landfill.

  • There is a current focus on the community sector receiving considerable amounts of funding to deliver public services through programmes such as Futurebuilders, and yet there is no similar recognition for community sector organisations delivering services to help business and industry to meet the Government targets, especially with the lack of accountability to the landfill tax payer by the distributive organisations such as the WIP.

    4) The community sector provides opportunities for greater social inclusion through employment and training programmes to get people into work

  • In terms of social inclusion, the Government needs to take a ‘bigger picture’ approach to this issue and see that there is a prime opportunity to solve several different problems at once.

  • FareShare plays a key part in relieving food poverty helping to provide 3.3 million meals for disadvantaged people in 2004 with the surplus food that would have gone into landfill, thereby helping to address the waste agenda. This is the kind of innovative solution that the general public really latch on to.

  • We estimate that each of the 250 local charities that receive food and support from FareShare can divert on average £20,000 from their food budgets; in 2004 that amounted to £5 million reinvested back into training, advice and other services to improve the health and well-being of their clients.

    5) DEFRA suggestion that the Landfill Tax Credit Scheme and Business Resource Efficiency and Waste (BREW) programme are not the only source of funding for community groups

  • This is true, but both funds are still the only source of funding that has been largely generated by tax levied on the food and drink industry, with the BREW programme specifically targeting industry to reduce reliance on landfill

  • The other funding sources such as those offered by the Home Office Section 64 Programme do offer funding to community groups such as FareShare. These are largely for project-based work. They continue to contribute to the boom and bust aspects of voluntary income, as opposed to offering long-term sustainable funding solutions that recognise the services that organisations like FareShare provide or investment to develop suitable business models and income

  • For example, the Futurebuilders programme aims to help community sector organisations win contracts with public sector organisations to deliver services and yet there is no similar contract-incentive to organisations working with private sector businesses such as the food and drink industry who are intrinsically involved in meeting the Government’s waste reduction targets.

  • Most of the environmental-funding from schemes such as CRED is for projects dealing with household and/or municipal waste and FareShare are ineligible for this funding as we deal with waste from the food and drink industry.

  • We made three applications to the Department of Health Section 64 funding programme for the year of 2005-06 (one for core funding and two for specific projects) and all of these applications were turned down.

    6) Environmental Funding Programmes

    a) Defra Waste and Resources Research Programme:

    Average grant will be approx. £150k and main focus is partnership working across different sectors and delivering 6 out of 8 of the main objectives of the R&D Strategy (the other two will be the focus of future funding rounds)

    FareShare fits into two categories:

    ‘Understanding the socio-economic benefits of recycling at a local or regional level’:

  • Research should address the ‘added value’ from the collection of materials

  • This area has been given high significance and medium urgency in the R&D Strategy

  • The closing date for expressions of interest for this was 10th January 2005

    Any research briefs submitted were meant to address new issues and not be concerned with existing areas of work. We could not apply because any research we want to undertake would be relevant to our existing areas of work.

    We therefore decided not to apply for this money because we do not have the resources to undertake this research at the present time and also we do not want to be doing research for the sake of it. It is the practical work for which we require investment and support.

    ‘Uncovering market opportunities outside of WRAP’s remit’:

  • Research should be an evaluation, in terms of the future need for market development and intervention, of specific waste streams. This could involve the establishment of criteria to prioritise specific materials and market needs, followed by a gap analysis. Research should also identify the potential development of the reuse market for specific waste streams.

  • N.B. although WRAP do deal with ‘organics’ under their remit, this is, in practice, confined to promoting composting as a process for recycling biodegradable waste.

    Expressions of interest have not been called for yet

    b) Defra Community Sector Support Programme:

    FareShare could not apply for this because it was only for organisations operating within the municipal waste sector.

    c) Defra Environmental Action Fund (EAF)

    FareShare would have possibly been eligible for funding under this programme, but 50% match funding was needed and it was not possible to source this match funding before the deadline, given that the fund was announced in August, at the same time as we were writing our Community Fund bids.

    d) Big Lottery Fund Community Recycling and Economic Development (CRED) Programme

    FareShare cannot apply for this funding because it is only for organisations that deal with household waste through increasing the amount and range of materials diverted away from final disposal and increasing the number of households participating in waste recycling, reuse and compost projects.

    e) Recycling Credits

    Under the Environmental Protection Act 1990, local authorities have the option to pay recycling credits to third parties (businesses or community groups) collecting waste for recycling.

    FareShare is not eligible for these credits however because we deal with commercial waste.

    f) Social, Economic and Environmental Development (SEED) Programme

    This programme closed in September 2003

    g) Defra Waste Implementation Programme

    This programme consists of a number of elements, including the Waste Minimisation Innovation Fund being administered by WRAP and their Retailer Initiative, designed to help reduce household food and packaging waste originating from the retail sector (i.e. supermarkets). The Retailer Initiative does not, however, address the minimisation of waste at source (i.e. within the manufacturing and retail chain)

    Waste Minimisation Innovation Fund

  • WRAP will procure research and development projects into design, prototyping and piloting of innovative products, packaging materials and systems

  • The Fund will support retailers and their suppliers in R&D projects that will minimise food and packaging waste originating from the retail sector

    FareShare is not eligible for any funding because it is only for projects dealing with minimising household waste that has originated from the retail sector, not the retail sector’s waste.

    However, the WRAP website acknowledges that ‘reducing food waste at source will help with the UK’s compliance’ of the various targets for the reduction of waste going to landfill set by the government.

    h) London Recycling Fund’s Economic Development/Infrastructure Building Programme

    This programme has recently opened, with the aim of ‘encouraging projects that support the development of sustainable enterprise within the reuse, processing and reprocessing sector in London’. However, FareShare does not fit into their funding criteria because we do not deal with municipal waste.

    i) Defra’s Business Resource Efficiency and Waste (BREW) Programme

    The funding principles for the programme are:

  • The focus should be on businesses most affected by landfill tax increases

  • A significant proportion of the funding is to be used for waste initiatives

  • The programme should take an integrated approach to resource efficiency

    Funding has already been allocated to a number of projects including the National Industrial Symbiosis Programme (NISP) and Envirowise. Defra anticipates that most of the objectives for the programme will be delivered through existing Government delivery agents and we have been told by various Defra officials that we do not offer the scale of diversion that is needed for funding.

    The funding programme will be officially launched from April 2005, but we do not anticipate being able to access funds from this source, on the advice of Defra officials.

    We have a number of letters from various Defra and HM Treasury officials stating that we do not fit in with any of their priorities for funding, given that our service does not offer the ‘value for money’ that other waste minimisation techniques do.

    HM Treasury’s own report, undertaken on their behalf by Integrated Skills, recognises that there is insufficient recognition of the waste issues arising from food in the retail and catering sectors, and especially amongst Small and Medium Size Enterprises, and that targeted grants aimed at involving the voluntary and community sectors should be considered a high priority option for the recycling of landfill tax revenue.

    There has been no evidence of these grants being made available to FareShare, which meets all of the priorities embodied in the report, namely:

  • Dealing with foods, aiming to ensure that no good food is wasted, and work to that end with many of the leading food industry manufacturing and distribution businesses

  • Contributing to significant and cost effective diversion of waste away from landfill

  • Working with many SMEs (c60% of our donors are SMEs) and our operations allow us to provide regional and local collection services

  • Measuring the volume of food diverted from landfill and the impact this has on the community

  • Operating as a community organisation with some 250 local charities as participating members

  • Supporting other community organisations helping the severely disadvantaged

  • Having an active promotion and awareness programme aimed at the industry, through use of events, literature and website

    In conclusion, a service that presents society with economic, social and environmental benefits has been left unsupported by lack of Government vision and appreciation.

    By Alex Green, Marketing and Fundraising Director, FareShare.

    Email: alex.green@fareshare.org.uk

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    Tel: 020 7394 2462

    Alex Green

    Marketing & Fundraising Director

    3 June 2005

    Tel. 020 7394 2462

    email. alex.green@fareshare.org.uk

    www.fareshare.org.uk

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