Key focuses for the Environment Agency for the year ahead after the Chief Regulator’s Report

For the first time, the Environment Agency ("EA") has published their Chief Regulator’s report. The report replaces the ‘Regulating for People, the Environment, and Growth’ and follows the creation of the role of Chief Regulator and the appointment of Dr. Jo Nettleton.

Introduction

The Chief Regulator’s role will be to lead the EA’s work to support ‘‘compliant businesses to thrive, grow, and transform’’ but also work with the EA’s enforcement teams to ensure ‘‘regulation translates into compliance and that serious non-compliance’’ is punished.

The report - which is the most comprehensive document that the EA release annually - gives valuable insight into their performance in previous years and upcoming focuses for enforcement. The EA will hope it provides substance to the Chief Regulator’s aims of leading the profession, setting the standards, and designing the future.

The report calls for the environmental regulation framework to be reformed to ensure the EA’s regulations “have more teeth’’. As well as further efforts to be made to make regulations simpler to follow and more agile, looking towards a future with increasing problems posed by climate change.

However, in the interim, it seems the EA intend to ramp up efforts to force compliance with increased enforcements, audits, and inspections against the waste, agricultural, and water sectors. As well as proposing increased cost penalties for those who fall below the required standards. The key parts of the report are discussed in more detail below.

What are the EA’s focuses?

Below takes a look at some key takeaways and focuses from the EA’s report:

Regulating industry under the Environmental Permitting Regulations (EPR):

In 2023, 89% of all non-compliant EPR sites were found to be in the waste sector.

The EA will be focusing on poor compliance and poor performance through continued investment in additional staff/resources to monitor and promote compliance, especially in the water, waste and agricultural industries.

In addition, the EA intend to increase the pace of delivering simpler permits to give applications greater certainty/transparency. They say that in the last two years, permitting improvement has improved by 20% which has led to customer complaints and backlogs halving. This would be a welcomed development for the industry, as the speed of permits being issued has clearly been an ongoing issue for a number of years causing the industry wide issues.

However, the EA believe that 25% of permit applications do not have sufficient information when submitted which causes requests for further information and novel/complex applications challenge the legislation the EA have to work within. They also cite that there are challenges securing the technical skills to deal with the most complex applications.

Waste crime:

In 2023, 33,978 tonnes of waste were prevented from being illegally exported which saved the economy £3.5 million.

In March 2024, the EA state there were 344 illegal waste sites. The EA consider combatting waste crime as a priority and it is clearly on their radar as a key issue they are focusing on. Whilst a regular feature of the EA’s concerns, with such a focus, it will be of great interest for the industry the approach the EA adopt in tackling this.

It is important to note, that over half of the EA’s prosecutions and 80% of enforcement notices were against the waste sector. There were 569 serious pollution incidents in 2023, and 54% of those were caused by sites/activities that were not regulated under environmental permits. The majority came as a result of noise or odour issues from waste treatment facilities and landfills. Again, no doubt another aspect the EA will continue to focus on within the waste sector.

Water industry performance:

The EA’s report identifies that two of the nine water and sewerage companies require improvement, and seven of those nine caused 47 serious incidents in total. This is caveated with the fact that 2022 was the wettest year on record, leading to storm overflows being used more regularly.

The Water Industry Regulation Transformation Programme was launched in 2023 – the plan was to increase inspections in the sector from 4,000 by the end of March 2025 to 11,500 in 2026/27, accompanied by £15.8 million being spent between 2024 and 2027 on improving water company enforcement.

The Water (Special Measures) Bill has prompted government funding to the tune of £55 million per year for increased water industry inspections/enforcement action, which includes recruiting up to 500 more staff.

Enforcement:

In 2023, the EA report that 91 prosecutions led to £8.7million in fines and 85 civil penalties led to £1.9 million for breaches of climate change schemes administered by the EA. They cite that the EA has secured £16 million over the past five years, which has been put towards environmental projects or improvements as a result of enforcements.

The EA have and will continue to work alongside other regulators, including the HSE, Office for Nuclear Regulation and government departments including the Economic Crime Unit, which was launched in 2024 in part, to carry out financial investigations in the waste sector.

Clearly enforcement is still high on the agenda for the EA which industry should continue take note of, given the increasingly large fines we are seeing issued for environmental breaches.

Agricultural performance:

An increase in agricultural resources meant that farm inspections increased from 3,173 to 3,940, with 53 farming activities causing serious pollution incidents, an increase from 45 in 2022. This led to 346 enforcement responses being issued, primarily in the form of letters and site warnings.

The EA report that 42% of the farms inspected were not complying with environmental regulations, and there is a need to improve yard infrastructure, slurry and silage stores, and have better soil testing.

The number of agriculture inspection officers has risen from 27 in 2020 to nearly 90 in the previous year, and targeted farm inspections have increased 10-fold since 2001. It is anticipated the EA’s focus will only continue on the agricultural sector which should take note of the ongoing focus on their industry by the EA.

A look to the future?

Within their report, the EA have implied they believe much of the regulatory framework is outdated and does not account for modern complexities that both they, as an enforcement body, and those expected to comply with the legislation deal with in practice. Their view is that legislation needs to be simplified to be more coherent, flexible, and have the required agility to appropriately deal with ever-changing problems. This would inevitably be welcomed by those affected by the regulatory framework, which is difficult to navigate and an extremely complete set of legislation and regulations.

The EA has stated that waste crime will be a focus in the coming year which is no surprise. In addition, further resources and manpower mean the water and agricultural industries will be subject to further spotlight. It is also likely that more inspections will take place on agricultural sites, and with further resources, it is anticipated there will likely be an increase in the over 50% of the EA’s prosecutions taking place against the waste sector.

The EA consider that to provide a better experience for those they regulate, they require additional funding at policy and implementation levels. However, in the current economic climate, is not clear how far the government’s appetite to provide further funding will extend. As per their Annual Report and accounts, in 2023/2024 the EA already had a gross expenditure of £2,235 million and they are set to receive £55 million to be received annually for regulation of the water industry.

In light of this, businesses should brace themselves for further active regulation from the EA, and the key sectors which have been focused on can expect to find themselves in the spotlight of the EA’s regulation. It is as imperative as always for businesses to ensure their ongoing compliance, particularly for those industries who the EA have identified as a core.

View the full report here