Select Committee on Environment, Food and Rural Affairs Minutes of Evidence

Examination of Witnesses (Questions 81 - 99)




  81. Can I welcome Dixons to the Committee. For the record, we have got Lesley Smith, Group Director Corporate Affairs. So you are the public voice of Dixons?

  (Ms Smith) For want of a better expression.

  82. For want of a better expression. And Geoff Bellingham, the Technical Director, and Vivien Williams, the Environmental Co-ordinater—all splendid titles. In your evidence at paragraph 6 you said Dixons' technical officers sought clarification of what the requirements of the regulations would be from DETR from 2000 onwards. What made you twitch to the extent that you thought, "We had better find out what all this means from DETR"? What caused you to focus on this?
  (Ms Smith) We were already in meetings discussing the future implementation of the regulation on waste end of life electrical products (WEEE). In the course of those we had raised on a number of occasions our concern that this Regulation would prevent, firstly, the export of products containing foam and then the disposal of products containing foam.

  83. Just in terms of timescale, you have given me the impression that you have been talking about the Electrical Waste Directive but you also had this one which was a parallel universe and something you thought was a problem. When did it crystallise in your minds from your knowledge of this particular new regulation? When did it first suggest itself?
  (Ms Smith) That was autumn 2000 because the regulations were published on 29 September 2000 in the OJEC Journal and they made it clear that would prevent either the export or the disposal of products containing CFC foam.

  84. So that was the first time that you formally, as Dixons, got sight of this to the extent that you said "oh, this could mean something to us"?
  (Ms Williams) I think in October 2000 when there were issues with exports and a ban on exports was introduced, we had a call from one of our sub-contractors who had been exporting to say that there were several containers of fridges and freezers that they could not export and they were backing up at Tilbury. At that point there was a meeting then with Customs and Excise, DETR and DTI to talk about that particular problem relating to exports. We went along to that meeting on 16 November 2000. That was when we read through the guidance and realised that there was an issue with exports and then disposal moving forward.

  85. So going back to the fact that this thing had been discussed in Europe for the previous two years, it had not registered on the Dixons' Richter scale at all really as an issue that might eventually affect you?
  (Ms Smith) We have a relationship with DEFRA and Customs and Excise on these things and we would expect—They published guidance, which was released to us in November, following the publication of the regulations at the end of September, so we would expect to be able to follow their guidance. In this case the guidance was unclear because the guidance note refers to disposal "if practicable" under Article 16. Retailers and disposal contractors asked what "if practicable" meant and then, in fact, when we looked at the actual document from the Official Journal of the European Commission it did not say "if practicable", it just said "controlled substances contained in domestic refrigerators and freezers shall be recovered and dealt with as provided for after 31 December 2001".

  86. Did you think that was entirely clear language and would have left you in no doubt as to what that meant?
  (Ms Smith) We thought that the regulation as published in the Official Journal was clear and we thought that it meant that you could neither export nor dispose of CFC foam containing products and that is why we wrote to Michael Meacher at the end of November 2000 in that case specifically to say did they understand what the effect of the ban on exports would have and could it be raised at the Council of Ministers that was going to discuss it at that point. We raised specifically the issue of foam there because the Official Journal seemed to us to be fairly clear.

  87. You are used to dealing with the complexities in the world of business, you have to deal with a lot of complex things, and you have said with absolute clarity you thought paragraph two in Article 16 was clear, you knew what it meant, you have told us what it meant. Did you wonder why Government was having difficulty in understanding it? Did any official ever say to you "we are not clear?" because one of the things I have struggled to understand is why the Government found it so difficult to understand something that you have told us you saw as crystal clear in terms of its meaning?
  (Ms Smith) It seemed clear to us but then, with all due respect, we do not spend every day of our working lives interpreting European regulations.

Paddy Tipping

  88. Thank God!
  (Ms Smith) Quite. So we did rely on the guidance of officials to give us their interpretation of what they felt it meant. They are also dealing with more than one company, they are dealing with lots of companies, lots of disposal contractors and lots of local authorities, so—


  89. In terms of the feedback you got from officials, did you get any flavour as to why the Government was struggling to understand this?
  (Ms Smith) No.

  90. What kind of a reply did you get from the Government when you posted formally your concerns? Did they write back to you, did they telephone you, what did they do?
  (Ms Smith) There were several different letters issued. The letter on 21 November from the DETR Global Atmosphere Division—

Mr Mitchell

  91. This is 2001?
  (Ms Smith) No, 2000. After the meeting which my colleague, Vivien, attended, there was a letter issued on 21 November, which I can pass the Committee a copy of—


  92. That would be very helpful.
  (Ms Smith) There were three letters. The first letter said "We recommend to any prospective exporter that they should satisfy themselves that any equipment to be exported contains no CFCs or other substances listed above. They should be aware that if they export a refrigerator, the form or refrigerant of which contains CFCs, they will be in breach of Article 11 of the 2000 Regulation. There may be legal action as a consequence." That letter was received on 21 November 2000 and refers to the foam and the refrigerant. Just for clarity, the refrigerant and the foam are separate things, both of which contain CFCs. The first letter we received referred to the foam and the refrigerant, so we took that to mean you could not dispose of either. We then wrote in response to that letter, and indeed this meeting, and we received a second letter on 1 December 2000, again from the Global Atmosphere Division, and that repeated the prohibition on the export of products containing CFCs but it referred only to CFC refrigerants and omitted any reference to foam and said that "Article 16 of the Regulation obliges all CFC refrigerants to be recovered safely for destruction." We were a mite confused because basically the reference to foam had been dropped in the space of about a fortnight. Then on 8 December we got a fax from Customs and Excise International Restrictions Team which said "....with effect from 8 January 2001 the export of pre-1996 refrigeration equipment must have a declaration that all CFC refrigerant gases have been removed", ie that is the liquid gas in the compressor not necessarily the foam. Again, the reference as to the foam had disappeared. Meetings continued over the next nine months or so and it was not until 9 August 2001 that a letter from the DTI confirmed that the European Commission had clarified that Article 16(2) of the regulation applies to insulating foam in domestic fridges, so then foam had reappeared again.

Mr Mitchell

  93. Can we just clarify that because you are talking there essentially about export, are you not, export of reconditioned fridges or whatever?
  (Ms Smith) Yes.

  94. There are two problems, one is the export and the other is the treatment of fridges in this country to remove the coolant and foam to deal with that. So all your awareness was focused on exports up to late in—
  (Ms Smith) No, it was not, because in fact the first letter on 21 November 2000, which was in the section I have just handed you, refers to Article 11, which is about export, the second letter in 2000 referred to Article 16, which is about disposal, and then basically thereafter the letters referred to Article 16.

  95. Did they bring up the issue of the foam and the insulation?
  (Ms Smith) The second letter dropped the reference to foam. There was some ambiguity because basically foam had been in there in the first place, which is what had thrown us into a panic, but thereafter the reference to foam was dropped.

  96. Right, so foam—?
  (Ms Smith) We still thought that foam was affected so from thereon we were in a position where we thought foam was affected and the Regulation was clear and the Department was seeking guidance to see if that was correct.

  97. So the Department is lumbering around trying to clarify things with the European Commission but Dixons were aware that the foam was an issue and would have to be disposed of. The foam meant that you could not export and the foam also meant that you could not dispose of it in this country. Dixons were aware of that in 2000?
  (Ms Smith) That was our interpretation. I wish we were aware. Bear in mind as well that we ourselves neither export nor dispose of—that is done by third party contractors. The point I would like to make in reference to the LGA's comment is that we did not walk away from providing the service voluntarily nor did we run away because it cost money. We had to withdraw the service because that service was withdrawn from us by the contractors who no longer had the legal means of disposal. It is a service that we very much wanted to continue and indeed still want to continue and wish to reinstate.

  98. I accept that but what you are saying essentially is that Dixons in the year 2000 were smarter than the average Environment Minister?
  (Ms Smith) I would not have said that.

  99. Hang on, you said that you did not find a reference to "as practicable as possible" in 16 (2). We were told in Brussels that this was the nub of the argument, was it practicable to dispose of the foam? You are saying, as you interpreted it in 2000, that it did not say "if practicable".
  (Ms Smith) It does say "if practicable". That is in point 3. Point 1 of Article 16 deals with controlled substances in refrigeration, air-conditioning and heat pumps, except domestic refrigerators and freezers, which I take to mean commercial units basically. Point 2 is domestic refrigerators. Point 3 seems to be all those other than in points 1 or 2. That is where the phrase "if practicable" creeps in. It is not in the previous two points. It may be that the argument hinged around did that "if practicable" cover all those points, although it is only in point 3. Geoff?
  (Mr Bellingham) We thought the balance of probability was the "if practicable" statement in item 3 referred to only those things covered in item 3. Point 1 meant all of commercial, point 2 meant all of domestic products, point 3 meant none of the above, but included everything else.

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