Finance Committee hammers Circular Economy Bill
The Scottish Government’s Circular Economy Bill has been criticised for a lack of financial transparency and accurate costings, in a report by a committee of MSPs published today.
Holyrood's Finance & Public Administration Committee ("FPAC") doubts that the bill complies with the Parliament’s rules on setting out “best estimates” of costs likely to arise.
The bill requires Scottish ministers to introduce measures to help develop a circular economy. These includes publishing a circular economy strategy, developing circular economy targets, reducing waste, increasing penalties for littering from vehicles, making sure individual householders and businesses get rid of waste in the right way, and improving waste monitoring.
Among the report's conclusions are that:
- enforcement costs are likely to have been underestimated;
- the assumption of a 100% payment rate for fixed penalty notices is "entirely unrealistic";
- further work is required in developing the costings for education and communication programmes with the public;
- a lack of clarity concerning the funding required for local authorities to align with a new, upgraded, mandatory code of practice could render the approach "unaffordable and unsustainable";
- the introduction of the bill and its interaction with related schemes, including the deposit return scheme, have created "an uncertain environment which has led to local authorities entering into short-term contracts that can provide little value for money", and the Government should explain how it will ensure greater certainty in relation to future proposed schemes; and
- introducing primary legislation prior to completing or, in this case, even commencing the co-designing of the detail, means that financial estimates are not available at this stage, "making financial scrutiny incredibly challenging, if not impossible".
The MSPs also ask the Government for information on timescales for undertaking further research on littering and flytipping, along with an explanation why the relevant research was not undertaken when the gap in information was first identified.
FPAC convener Kenneth Gibson MSP commented: "Scrutiny of this bill reinforces our concern that affordability does not appear to be a key factor in Scottish Government decision-making. The minister, Lorna Slater MSP, has committed to consult on the cost of secondary legislation, but that should not replace an assessment of affordability at the point of a bill’s introduction.
"Our committee is not convinced that this bill’s financial memorandum meets the requirements set out in Parliament’s standing orders to provide: 'best estimates of the costs, savings, and changes to revenues to which the provisions of the bill would give rise'."
Mr Gibson added: "We’ve seen an increasing use of ‘framework’ bills that provide Government with future enabling powers. These do not, however, provide best estimates of all likely costs, and undermine parliamentary scrutiny. It also risks the Parliament passing legislation which may in the end – once outcomes are fully understood – lead to significant cost increases.
"The increased use of framework bills with no clear implementation costs, poses a long-term risk to the Scottish budget, both now and for successive governments.
"The FPAC is disappointed that Scottish ministers have still to meet our previous recommendations or expectations around the level of financial data, clarity and transparency required."