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  • Ruth Cadbury MP

On Thursday 2nd May 2019, Policy Connect held a cross-APPG meeting in which members of the All-Party Parliamentary Sustainable Resources and Manufacturing Groups came together to discuss the role of public procurement in helping foster a market for remanufactured goods. The event was a follow up from a 2014 report which, signed by both groups, made the social, economic and environmental case for remanufacturing. Under the chairmanship of Ruth Cadbury MP, 18 representatives from a variety of industries and sectors - from public health to steel - joined the roundtable and shared their views on the impact and potential of remanufactured goods in the context of the public sector.

The discussion was broad and covered a range of the benefits and challenges of remanufactured goods, from opportunities and barriers to uptake, to the importance of strong standards and certification and the role of public perception, the importance of government support, design and product lifespan and the importance of a holistic approach to product lifecycle.

Several clear opportunities were set out, from the potential for job creation and the high level skills required for remanufacturing to the competitive costs for the consumer and reduction in energy usage and emissions. However, attendees highlighted numerous barriers that currently hold remanufacturing back, including the high cost of doing business in terms of energy prices and business rates. It was felt that currently in the public sector, there is a poor level of understanding of sustainability generally, but specifically what remanufacturing means, and how it could add value and save taxpayers’ money when procuring goods. It was also noted that current guidelines sometimes consider carbon risks, but fail to recognise other harmful materials being used.

Another main topic of discussion was the importance of clear standards and certification for remanufactured goods. However, any such certification or standards must be built with cost effectiveness for business in mind, and simplicity of terms in order to create buy-in from the consumer, who will ultimately sustain any market in remanufactured goods. Attendees saw the current focus on recycling and sustainability as an opportunity to further the agenda, but stressed that the biggest move in this debate has been around recycling, and that this was normally thought of in relation to sustainability rather than reuse/remanufacturing.

 

Government engagement was seen as key to remanufacturing becoming a sustainable market. Attendees discussed the potential for incentives such as a business rate reduction, or tax credits in a similar way to R&D tax credits for companies remanufacturing goods. Sharing of knowledge based good practice was also discussed, and the importance of collaboration between business, government and academia stressed, a portal to share information was suggested as a potential route to increase information sharing whilst also potentially sparking collaboration. However, there was a concern that given the lack of action on the waste strategy to date, it appears unlikely that the government will have the bandwidth to consider additional actions.

The importance of modular production and design was also discussed, with attendees noting the success of the servitisation or solution based contract model which has been used in office printing for almost 30 years, and the recent moves to this model with home printing, cars and other high-cost products, moving from the idea of buying a good to buying an outcome. This practice was seen as far easier in a B2B context. If this practice were to become the norm in wider society, it would provide incentives to business to move away from the short life product and back towards a longer life span, and thus increase remanufacturing as this would reduce the use of components and thus reduce cost.

To sum up the discussion, participants around the table shared their one key ask for public procurement to foster remanufacturing and act as an enabler of the circular economy:

  • To move towards solution-based contracts that work on the end solution
  • To increase and improve standards & certifications
  • To provide a knowledge sharing portal for companies who are already working in this area and those who want to get into remanufacturing
  • To include a circular economy assessment as part of public sector procurement
  • To build stronger collaboration between academia, businesses and government.
  • To consider the capabilities of product for end-of-life and what can be done with it afterwards; whether it can be broken up, recycled, etc.
  • To add a sustainability criteria within public sectors tenders, which could drive sustainability
  • To increase transparency leading into more public reporting and collaboration
  • To increase the information and education available to public procurement officers
  • To include a procurement specification requiring remanufactured content/goods
  • To enable the public sector to sell equipment back for ethical recycling
  • To systematically integrate lifecycle analysis into public procurement

Three key takeaways:

  1. There is a need for clear guidelines for remanufactured goods in public procurement from government, together with the need to incorporate sustainability as a key requirement in public tenders.
  2. Government should look to move towards product servitisation and solution based contracts that take into account lifecycle/circular economy analysis, including end-of-life disposal.
  3. Public procurement officers need to be supported with better education & information, to change perceptions and increase awareness of remanufactured goods.

PROPOSED NEXT STEPS: APSRG and APMG to engage with public sector procurement at both national & local levels to better understand current levels of remanufactured goods in procurement.