APRS Resources

Putting a purpose at the heart of the Circular Economy Bill

Joint briefing from the third sector – This briefing is to explain why a purpose clause should be part of the Circular Economy Bill.

April 2024

As the Bill stands

The Scottish Government’s Circular Economy Bill does not currently contain a simple definition of a circular economy within the Bill. This risks Parliament making opaque legislation which is both hard to understand and hard to use. 

Neither does it formally commit Ministers to following the waste hierarchy, a concept in widespread use since the 1990s. The hierarchy is used across the EU, in line with Article 4 of the Waste Framework Directive, and is operational at a UK level as per this guidance

The UK version of the waste hierarchy puts prevention at the top, then preparing for reuse, then recycling, then other recovery (including incineration), and then, as the last resort, disposal. This prioritisation is one of the keys to circular economy policy, but is not included in the Bill as lodged prior to Stage One.

There are two places within the proposed legislation where some of the language associated with this concept is used. Section 1(3) lists some of those elements as they would apply to the strategy document the Bill would require, while 6(2) uses the same elements as they would apply to the targets Ministers might adopt under a final Act. In neither place, though, is the list explicitly hierarchical – in other words, reduction and reuse are not formally prioritised over recovery at end of life. 

Why a purpose clause would be beneficial

An explicit purpose clause within this Bill would require Ministers to follow the widely-accepted hierarchy when writing subsequent strategy documents or proposing targets under final legislation. Every product incinerated that could be recycled is a market failure, as is any product recycled that could be reused, or any product reused which could have been avoided in the first place. Striving to move every product as far up the hierarchy as possible is the gold standard for circularity policy, and it should be explicit on the face of the final Act.

Adding a purpose clause would also be more effective than simply amending the existing sections 1(3) and 6(2) to make them explicit about the hierarchy, as it would apply not just to the strategy and targets but every power within the Bill. 

Following the hierarchy would (or should) not be a departure from Scottish Government policy. In evidence to the Net Zero, Energy & Transport Committee, the Minister confirmed that “the waste hierarchy would be embedded in the strategy” (par 179 of their Stage One report). Several of the Committee’s recommendations also emphasised the importance of actions being taken further up this hierarchy (21, 26, 69, 70).

Such a clause should also define a circular economy for users of the legislation. The most concise definition of that concept for such purposes would be to set out that “a circular economy is one which reduces as far as possible the use of non-essential virgin materials”, or similar. It should include reference to a safe circular economy in recognition of the danger posed by harmful chemicals in reuse and recycling. Clarity would be very beneficial, given there are so many alternative definitions in use – 221 according to one study cited here.

Additional elements such a clause could cover

Although it would be desirable simply to have clarity that the waste hierarchy should govern all use of powers under a final Act, a change of this sort would be an opportunity to advance standards and consider other issues which are of importance to Parliament and Ministers.

Two related recommendations were made by the Committee in their Stage One report.

Paragraph 24:

The Committee recommends the Bill be amended at Section 1(2) to include a requirement for the strategy to state how it has applied Just Transition principles. We further recommend Section 1(3) should include adherence to just transition principles as a desirable characteristic of a circular economy.”

Paragraph 27: 

there are a number of other characteristics desirable in a circular economy and recommends the Scottish Government consider the proposals made by stakeholders to include reference to international impact and environmental impact.” 

Although amending Section 1(2) in this way would be beneficial, as discussed above that would then only bring that principle to bear on the strategy element of the legislation. Embodying just transition and the development of due diligence requirements in international supply chains would support wider good practice.

Purpose clauses in other legislation

Section 2 of the UK Withdrawal from the European Union (Continuity) (Scotland) Act 2021 provides a good recent example of this approach in drafting, listing as it does five areas where standards should be maintained and advanced., The concept was examined as part of the 1975 Renton Report, discussed here by Scott Wortley at Edinburgh University’s School of Law. 

As Wortley puts it: 

Renton felt that statements of purpose could be valuable when used to illuminate the legal effects of legislation, thereby serving a role in resolving any uncertainties in other provisions (in essence fulfilling a role of providing provision within legislation which could aid its interpretation and assist the reader in determining the meaning of provisions).

The Circular Economy Bill, which will have effects for councils, businesses, and the public, is very much in need of this approach.

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