Reflection on the European Commission’s preliminary report on the review of the regulatory framework for waste management

In 2022, the European Commission launched a public consultation on the review of the regulatory framework for waste management^[1], to which Századvég Konjunktúrakutató Zrt. also responsed. We expressed our view that while the modernisation of waste legislation was meant to take into account the original objectives of the framework (e.g. waste management, reuse and recycling methods should reduce the use of resources), it should also take into account differences between Member States, and intertemporal changes in consumer attitudes and their actual behaviour. In autumn 2022, Századvég Konjunktúrakutató Zrt. had organised a webinar on this topic, involving EU, market and public actors to discuss the regulatory framework.

As part of the review process, the European Commission published a preliminary report in early June 2023 identifying Member States at risk of falling short of the 2025 targets for recycling municipal and packaging waste and the 2035 targets for landfilling reduction. The two key target indicators that the document analyses and makes Member State-specific recommendations on:

• By 2025, the preparation and recycling of municipal waste for reuse should be increased to a minimum of 55% and, also by 2025, 65% of all packaging waste should be recyclable;
• and, by 2035, a maximum of 10% of municipal waste may go to landfill.

The EC report shows that Hungary is in a group of ten EU Member States that are somewhat below the average for both important targets, meaning that “for both targets, it is at risk of not reaching the targets”.

The Commission’s proposals, which are guided by country-specific observations, include considerations concerning the sophisticated processing of bio-waste and packaging waste, and that particular attention should be paid to “…improving data quality, ensuring effective enforcement of rules and the use of more efficient economic instruments, such as effective extended producer responsibility schemes, fit-for-purpose landfill and incineration taxes” as well. These are very much in line with Századvég’s 2022 white paper.

The consultation process and the EC preliminary report present insight into the process, and also suggests what type of interventions Member States should consider implementing during the coming years. In the following, we reflect on these.

We would like to underline once again that:

– The revised rules should not disproportionately represent the interests of industrial waste producers.

– The end-users who generate waste should be more prominent in the regulatory framework.

– Well-enforceable legislation should be based on accurate, verifiable and searchable data records and the resulting databases.

– For waste to be effectively transformed into a resource^[2], the waste hierarchy needs to be enforced, but also the polluter-pays principle needs to be complemented by a so-called “data-based” variable.

• This could be achieved by creating and managing real-time, accurate and traceable databases on the generation of community, industrial and end-user waste and by-products. The databases should be created using a data network that is automated, i.e. AI-based, Big Data analytics-driven, to enable near real-time feed-ins for waste collectors, processors and recyclers.
• Accurate and dynamic identification of major waste generators and the volume of waste generated is an indispensable prerequisite for cost- and environmentally-efficient waste management.
• We would suggest mapping the actual behaviour of waste generators (mainly end-consumers) through primary research to gain a better understanding of specific segments of waste generation. It is vital to look at actual consumer behaviour^[3]. This should be done by using comparative methods of behavioural analysis that take into account the local specificities of each area of the EU^[4] (it is likely that we will find different characteristics in, for example, the Netherlands, Italy^[5] and Hungary).^[6]

– It is also important that legislation underpinned by behavioural characteristics bear in mind that the current consumer society dates back at least a hundred years, and entire industries have been built to serve it.

• If changes in societal and final consumer attitudes are to be achieved, disruptive and sustainable legislation is needed, but this legislation should not lead to an unjustified increase in the costs associated with the collection and processing of waste and by-products. In a global market environment that is sensitive to public utility costs and subject to high inflation, this should be a priority.

– We believe that (legal) intervention and the enforcement that supports it should pay attention both to discouraging negative behaviour and to promoting positive behaviour^[7]. Legislation that only aims to influence and/or regulate consumer behaviour and does not address industrial emitters will only achieve suboptimal results in terms of social utility. In a turbulent economic climate such as the current one, the incomes of many consumers should be treated with particular sensitivity, and imposing a disproportionate burden without the possibility of reward could trigger protests that make solidarity with the implementation of the law difficult.

• Long-lasting legislation should focus on individual emotion-based (and biased) decision-making, the role and impact of community feedback, the spread of environmentally-centered thinking and the empowerment of consumers to manage waste.^[8]
• To narrow the information gap, we would propose reward-based waste sorting and collection as one solution. It is also worth considering rewarding individuals who “progressively use fewer natural resources”.

1. Findings in behavioural science highlight that the automatic change of ingrained habits, both at the individual and societal level, is much more effective for people under 40 than for older people, and therefore legislation and its implementation should take this into account.^[9] Either by being more patient with older people or by age cushioning the burden (rewards, punishments, grading, etc.) accordingly.
2. It may be timely to introduce or, where appropriate, revise pay-as-you-throw and save-as-you-throw systems supported by an appropriate pricing model that weighs in cultural and local contexts.^[10]
3. Our previous research suggests that, in addition to demographic characteristics, residential activity may also be a differentiating factor in the importance households attach to efficient waste management at the household level. Residents who live closer to the natural environment in small towns, villages and are more active in managing their household and garden are more positive about improving waste management than those living in urban areas. One reason for this, in addition to improving natural and social utility, is the potential improvement of the economic situation of households through efficient waste management.

– Waste management enforcement rules and the powers of enforcers need to be strengthened at national, regional and local level.

• A more effective policy on fines for waste management is needed. The imposition of fines should be facilitated by police, tax authorities and other enforcement bodies. Together with this, community rules, environmental agency rules and statutes also need to be strengthened.

Check the Webinar here: