My Lords, I thank all noble Lords for their comments, but in particular I thank those noble Lords who have given at least the partial support that the noble Lord, Lord Whitty, offered. I will see how many of noble Lords’ questions and comments I can address, bearing in mind that our process may shortly be interrupted. However, I will see how far I can get.
The noble Lord, Lord Anderson of Swansea, asked why there had been a delay in getting to where we have. I know that I will not satisfy him entirely, and I suspect that he may have heard me say this before. However, I will say again that we carefully considered the situation and looked at the effect of the scheme in Wales to enable us to design what we considered to be the most appropriate scheme in England. As he knows, we first used voluntary industry initiatives to reduce bags, which proved successful up to a point. The other point it is worth making is that we needed to work with retailers to give them time to prepare. I know that I am not satisfying him entirely, but he will allow me to make that point.
He also asked what the purpose of an end date to the legislation is. It is standard practice from the perspective of Better Regulation to include a sunset date. It gives the Government of the day the opportunity to review the legislation to decide whether it is fit for purpose, and indeed to amend it if they wish to do so. Seven years is standard practice in that regard.
The noble Lord raised the exclusion of SMEs, as did a number of noble Lords. I am aware that some SMEs wish to be included within the scheme, but we have chosen to exempt small and medium-sized businesses from the charge to reduce the administrative burden on start-up and growing businesses at a time when we are supporting new growth in our economy. It is important to remember that the large majority of single-use plastic bags are distributed by the large retailers, and the seven major supermarkets gave out more than 7 billion of those bags in 2013. Small and medium-sized businesses are able to charge on a voluntary basis if they wish, and we have been told about some that already charge voluntarily and are generating significant financial benefits from a reduction in the number of bags they supply. I thoroughly encourage that. There is a requirement in the order for the system to be reviewed within five years, and the scope of the review will be set by the Secretary of State at the time,
but I am confident that the SME exemption will be one element of the policy that will be considered as part of that review.
The noble Lord, Lord Whitty, asked a related question. The impact assessment also states that there is an overall net benefit to society when SMEs are excluded from the scheme. The Government have therefore chosen to exempt them from the plastic bag charge to avoid placing an administrative burden on them at a time when, as I said, we are supporting growth in the economy.
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My noble friend Lord Lindsay suggested that the process was rushed. The details of the charging scheme were subject to a call for evidence, which was widely publicised, and we received 185 responses to the questions. The majority of the respondents supported the introduction of a charge on plastic bags. The summary of responses was published in June. In parallel, we received just over 2,000 emails on the broader shape of the charge, predominantly as part of NGO campaigns. We also used the evidence provided to the EAC and its report as an additional source of evidence in the development of the scheme. As well as ongoing engagement with retailers, the plastics industry and NGOs, we have held workshops with the British Retail Consortium and its members, and made some changes to the draft order, based on their feedback. We have also engaged with the Local Government Association.
My noble friend Lord Lindsay also asked: why would we proceed with an exemption for biodegradable bags when this might harm the recycling industry? We recognise the concerns regarding the separation of biodegradable bags from the waste stream. We seek to develop a standard that will take these needs into account. We have in hand research under the Small Business Research Initiative, including research into separation methods. My noble friend Lord Holmes asked about the same thing. We are keenly aware that we need to assess the impact on the recycling sector before introducing an exemption for biodegradable bags. We are looking to develop standards for a biodegradable bag that can be detected in the recycling stream.
My noble friend Lord Holmes and the noble Lord, Lord Whitty, asked about charging for paper bags. Plastic bags are prolifically distributed, take longer to degrade in the natural environment, can harm wildlife and are extremely visible when littered in our towns, parks and the countryside. Paper bags make up less than 0.1% of carrier bags distributed by major supermarkets and can biodegrade naturally over time in the open air.
My noble friend Lord Holmes asked where the revenue from the charge will go. How the proceeds from the charge are spent by retailers is a matter for retailers. The Government do not have the legal power to force retailers to use the proceeds in a particular way. However, we would expect them to donate the proceeds from the charge to good causes, after deducting reasonable costs. Many retailers have already confirmed to us that they will do this, and we will require them to
report on the number of bags charged for and how they have used the proceeds. This information will be made public.
The right reverend Prelate the Bishop of Chester asked about the exemptions in the order and whether they were the same as in other UK countries. My noble friend Lord Holmes asked a similar question. We looked carefully at the Welsh scheme but decided to put forward a scheme that is better suited to the local circumstances in England. We have therefore opted to exempt SMEs and paper bags, unlike in Wales and Scotland, and believe that it is better not to impose administrative burdens on SMEs. Paper bags are also not so widely used by the big supermarkets.
My noble friend Lord Ridley evidenced some scepticism over the figure of £780 million in the impact assessment. We have drafted a full impact assessment, which is available on the government website. It shows the expected impacts of the charge on consumers, businesses and others affected by it. Using the Government’s standard procedures for these things, the total net impact of the scheme over 10 years is calculated to be a positive benefit of more than £780 million. That figure includes savings from reduced costs associated with littering and carbon dioxide-equivalent emissions.
The noble Lord, Lord Dubs, asked about a bag of oranges. I can tell him that bags used solely to carry unwrapped food are exempt from the charge.
My noble friend Lord Holmes and the noble Lord, Lord Whitty, asked how this fits with EU law and whether one can exclude one type of bag over another. In fact, our scheme fits very well and is compatible with EU law. Indeed, there is a current EU proposal to take action specifically on plastic bags. I hope I have addressed most if not all of noble Lords’ questions. If I have not, I shall of course scrutinise Hansard and write to them.