A knock on the door might bring an offer of free material to raise ground levels for a building project. It might be just what is needed and could save a lot of money.
However, questions need to be asked and processes gone through before accepting such an offer, warns Christian Silk of law firm Foot Anstey.
The consequences of falling foul of the rules can be financially disastrous.
This is not about dumping rubbish but about the disposal of surplus material – usually from development sites – which could meet the legal definition of waste, says Mr Silk, who is the firm’s head of strategic infrastructure planning.
If it is inert and can be used for another economic purpose, then it is possible for it not to be classified as waste and, therefore, acceptable for uses on farm, such as making tracks or raising ground levels for a new farm building or a diversification project.
“Typically, a developer will employ a haulier to remove the material and take it to landfill, or perhaps to another development site,” says Mr Silk.
“What often happens is that a local farmer will be known to the haulier who may offer the farmer the material, with a payment of perhaps £5-£8/t to take it.
“This is far lower than the £15-£20/t the haulier may have been contracted to be paid to take it to a landfill site, so the farmer gets a payment and the haulier makes more money than they would otherwise have made.”
Be aware of the exemptions
It may be possible to get what is known as a U1 exemption for material that would otherwise be classified as waste (see panel).
This allows the use of a limited tonnage of material such as stone for making tracks, or soil for raising levels or infilling. There is a time limit of three years in which the U1 material must be used.
It is not uncommon for the haulier to apply for this exemption, but Mr Silk recommends the landowner takes on this responsibility through a consultant.
U1 exemptions for suitable waste
The U1 exemption allows the use of suitable waste rather than virgin raw material or material that has ceased to be waste. There are quality protocols involved in this.
If such an exemption is granted, then it must be used within three years. Additionally, the waste must not be stored for longer than 12 months before it is used.
The tonnage limit depends on the material, but is often 6,000t.
For larger projects, there is an alternative process called CL:AIRE. As long as the guidance is followed, material can be registered with the Environment Agency (EA) to prevent it being classified as waste.
Alongside the CL:AIRE rules is another set of requirements known as the Definition of Waste: Code of Practice (DOW COP).
Among other things, this enables the direct transfer and reuse of clean, naturally occurring soil materials between sites.
The benefit of this is that there is no tonnage limit if it can satisfy the DOW COP requirements, explains Mr Silk.
In order to achieve the requirements, a management plan must be submitted to the EA, demonstrating that it is financially more productive to use this material instead of material that would otherwise be used.
Tips for those accepting material onto their land
- Keep a record of what is offered, when, by whom and for what payment
- Insist on tickets for all loads and keep all paperwork
- Make sure the tonnage limit is adhered to on U1 exemption – this depends on the material, but is often 6,000t
- If the farm has a weighbridge, insist all material is weighed in
- Put the onus on the haulier to check the material is what it should be
- Good specialist advice is essential – use a consultant in the field to check what material is being proposed and that it is appropriate in type and quantity
- Loads should always be checked at loading and tipping – inappropriate material can result in massive costs and heavily reduced land values
Substantiate the project
However, it is not a carte blanche – under the CL:AIRE requirements, it is important that there is a genuine scheme for which the material is required.
For example, where planning permission has been granted or the exercise of a permitted development right notified to a planning authority, or there are detailed drawings and/or costings – these will help to substantiate a genuine intention to carry out a project, says Mr Silk.
“Where the problem may come for a farmer or landowner is when there is not a genuine need for the material – then by receiving it, they are effectively operating an unlicensed waste site.”
The penalties for this would be imposed by the EA and include prosecution and a fine, together with a court order requiring the material to be removed.
A landowner could also be held liable for the entire landfill tax that would have been due on the material, but charged at the much higher “standard” rate.
Landfill tax for such material is currently levied at £3/t. However, the “standard” rate is £94.15/t if it is discovered that the material should have gone to landfill.
“The risk to a farm can be substantial if you get it wrong,” says Mr Silk. “Landowners have faced substantial liabilities which could amount to over £1m for material for which they were paid only £50,000-£80,000 by a haulier to take on to their land.
Waste duty of care
The waste duty of care applies to everyone in the waste chain. A code of practice issued under section 34 of the Environmental Protection Act 1990 applies to those who produce, carry, keep, dispose of, treat, import or have control of waste in England or Wales.
The law requires anyone dealing with waste to keep it safe, make sure it’s dealt with responsibly and only given to businesses authorised to take it, and the code explains how to meet those requirements.
Those authorised or registered in Scotland or Northern Ireland but who store, transport or transfer waste in England or Wales, are also covered by this code.
Know the fundamentals
“The message here is that if you engage with a haulier, you should document everything in the clearest possible way and follow the procedures – a handshake could lead to a nightmare.”
If the transaction comes under scrutiny, key questions will include “who asked what of whom and how much was agreed in both money and tonnage terms?”
It is important not to work up a scheme in response to an offer. The fundamentals include identifying the cost of carrying out any scheme using “clean” materials, and the increased justification for carrying out the development if it is significantly greater by using waste in place of clean materials.
Specialist engineers are also needed for this calculation, says Mr Silk.
“Most people do not think of this type of transaction with the Inland Revenue in mind, but you have to be able to show the Inland Revenue that it is not a contrived scenario.
“The Environment Agency may take an interest and pursue you if an impact assessment or planning permission was needed, but the Inland Revenue will sue for lost landfill tax and the penalty.”
The added risk is that the landowner and haulier will share liability and it is at the Inland Revenue’s discretion how this is split.
If the Inland Revenue thinks it has a better chance of getting money out of the landowner, then that’s where it may direct its efforts, says Mr Silk.
Tickets for waste loads are only required by the EA to be kept for two years, and in the case of a breach, it may decide to require removal of the material and prosecution – or neither.
Prosecution will often depend on whether this is considered to be in the public interest.
The Inland Revenue can go back six years and, having recently recruited many new members to its landfill tax team, will go to a site and take measurements to establish how much material might have been tipped and, therefore, how much landfill tax and penalty is due, says Mr Silk.
Judging the tonnage depends on the material and how wet it may have been. Ideally, everything should go over a weighbridge on arrival, but this is not possible on many farms.
Mr Silk advises keeping all delivery tickets.