Tax and Bins

ERIC PICKLES MP
SHADOW SECRETARY OF STATE FOR COMMUNITIES & LOCAL GOVERNMENT


HOUSE OF COMMONS
LONDON SW1A 0AA

27 June 2008

Dear Councillor Smith,

GOVERNMENT PLANS FOR BIN TAXES & THE 2009 ELECTIONS

I wanted to provide you with an update on the Labour Government’s plans to levy new bin taxes on family homes. Despite repeated briefings by Downing Street that Gordon Brown is scared that bin taxes will be unpopular, the Government is moving ahead with legislation to introduce new charges for the collection of household rubbish.

Initially, five pilot schemes will adopt these new taxes; the Government’s own predictions then forecast that the taxes will be extended to two out of three homes. Ministers have written this week to every local authority chief executive, to try to invite councils to take part in such schemes. This is a trap to attempt to entice Conservatives councils into supporting the Government’s deeply unpopular plans. I believe that every Conservative councillor has a key role to play in defending families from these taxes.

The key arguments against participating in such pilots are as follows:

· Higher taxes on families: Families across the country are suffering from a soaring cost of living. Bin taxes will punish families for having children. Even the Government’s own optimistic Impact Assessment admits that families will pay £72.31 a year more. The Treasury has openly admitted the new ‘waste incentives’ are officially a tax.

· Increasing the tax burden: Labour Ministers claim that such schemes could be revenue neutral. They made the same empty promises about the council tax revaluation in Wales. Representations from councils across the country have warned that the Government’s sums do not add up due to the set-up, administration, collection and enforcement costs of a brand new tax, as well as the need for new lockable bins. As the Chartered Institute of Water and Environmental Management have warned:

“Costs will be incurred to councils for administration and enforcement. This means that in terms of value added such initiatives would therefore do nothing to assist councils manage their waste budget in the face of rising costs. If the costs for administration are expected to increase substantially in order for householders to be monitored and billed accordingly, but with overall council tax remain bill remaining the same, then either householders who are recycling will pay a proportionately larger slice (this may be significant sums per annum, as has occurred in Ireland, where costs of 300-400 Euros are not uncommon for waste collection), or other council services might have to be reduced in order for revenue to be redirected to cover waste administration.”

· Harmful to the environment: Bin taxes will lead to a surge in fly-tipping and backyard burning. Fly-tipping has already soared in the last three years due to higher landfill taxes. Bin taxes will give perverse incentives to households to dump their rubbish, stuff it in bins other than their own, or contaminate recycling collections. In the Republic of Ireland, bin taxes have led to 4 in 10 households now burning their rubbish, and such burning of now causes 73% of all dioxin emissions. Under the Government’s proposals, civil amenity sites will have to remain free for household waste. Many residents will therefore drive to the local dump to avoid bin taxes – increasing carbon emissions and congestion.

· Electorally unpopular: The politics of rubbish is very high on media’s agenda and a great cause of public concern. Councils which introduce bin taxes will be vilified in the popular press and punished at the polls. I am sure that Liberal Democrats will happily be two-faced in opposing them locally, even though they support the taxes in Cowley Street. Nationally, we will not hesitate to criticise any supposedly-Conservative council which collaborates with the Labour Ministers and props up Gordon Brown’s discredited stealth tax regime.

In short, bin taxes will harm the local environment and increase the cost of living. This is just another cynical Labour attempt to tax families more by stealth, but with a thick coat of greenwash. The Government should be working instead with councils to extend recycling collections, and make it easier for all households to go green. There is certainly a role for incentives, but not for taxes or charges.

There is great concern in local government about the growing cost of waste. The Government is imposing massive regulatory costs on local councils through LATS and landfill tax. But the answer is not to increase taxes on families, but for the Government to compensate councils for those costs.

With a significant set of local and European elections in 2009, Conservatives need a unified front in opposing these new taxes. We intend to provide a campaign pack against bin taxes in due course, which will provide you with ammunition to take on our opponents in the run up to the elections. We can take the fight to Labour on an issue which will resonate with every household in the land.

I want every Conservative councillor to show how people can vote blue, go green and keep the cost of living down.

Yours truly,




Eric Pickles MP
Shadow Secretary of State for Communities & Local Governmen