29 October 2008: The Polluter Pays Principle Should Not Be An Option

The Polluter Pays Principle (PPP) is described by the Organization for Economic Co-operation and Development (OECD) Council Guiding Principles as the "the principle to be used for allocating costs of pollution prevention and control measures to encourage rational use of scarce environmental resources and to avoid distortions in international trade and investment”. It is also known as the “Internationalization of the Environmental costs”. It implies that the cost incurred from any form of pollution should be the responsibility of the polluter in order to ensure that the environment is protected for present and future generations. The PPP is widely acknowledged as a general principle of International Environmental Law and is frequently mentioned in Multilateral Environmental Agreements (MEA).

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PPP has gone through several stages since the OECD recommended it as far back as 1972 regarding international economic aspects of environmental policies - even though it already existed in other countries/regions. In 1989 the OECD re-introduced it and included costs related to accidental pollution, affirming that "in matters of accidental pollution risks, the PPP implies that the operator of a hazardous installation should bear the cost of reasonable measures to prevent and control accidental pollution from that installation [...]". The extension also addressed prevention of accidental pollution, its control and clean-up costs and was then referred to as the extended Polluter Pays Principle.

The PPP was reiterated again in the 1992 Rio Declaration and called for all national authorities to promote internalization of environmental costs and use of economic tools in the public interest and the straightening of international trade and investments. It further stated that the “costs of these measures should be reflected in the costs of goods and services which cause pollution in production and/or consumption and should not be accompanied by subsidies that would create significant distortions in international trade and investment”.

It is clear that environmental damage should be rectified at source as a priority and the polluter should pay. When authorities fall short of compliance with this principle, then they encourage noncompliance to environmental protection laws. PPP was introduced in the European Community Treaty (ECT) in 1987 and now set out under Article 174.2 of the Treaty. It has proved to be its fundamental principle. However this has not been fully adhered to in developing countries. National authorities relate less to PPP mentioned in the existing environmental laws and it is rarely or hardly ever implemented. At the international level the Kyoto Protocol serves as a perfect example of application of the PPP and states that “polluting parties must bear the obligation to reduce greenhouse gas emissions and must also bear arising costs of pollution”.

The ECT has a Packaging Directive to back up PPP that refers to the obligations of a polluter paying for environmental damage and shared responsibility principles, especially during packaging of finished goods and services. Producers are required to fully bear the costs of collection and recycling of products and materials, though in most cases, the law allows for delegation especially in collection of waste mainly based on “integrated waste management” models covering national territories. Activities that cannot be delegated for example motor pollution should be given strict attention. In London for example, a new scheme will require drivers of heavy polluting cars to pay £25 to drive into central London, with an overall aim of combating the worsening effects of climate change. Less polluting cars won’t have to pay.

The importance of PPP in every country should be emphasized: PPP promotes efficiency in implementation of environmental policies and the international environmental laws. With regard to the legal aspects of PPP, it complies with the rule of law in ensuring effective environmental enforcement. Adherence to international environmental policies is an important factor in ensuring a globally secured environment, and adherence to PPP is one big step in creating harmonized collaboration in this regard.

PPP best defines how to allocate environmental costs within a country and by shifting the cost burdens to those who create them at the source will reduce taxes, healthcare costs, and increase productivity. It is important to note that PPP only determines who will pay for pollution control but cannot ensure cost effectiveness in a society. The onus is on national authorities to bear the responsibility of conducting pollution control activities and treatment of pollution (the actual polluters or public agencies able to treat pollution).

Implementation of the PPP has indeed faced a measure of resistance with some parties arguing that PPP is inconsiderate and the government, not developers, should bear the costs of pollution due to high tax rates charged on development and expensive license fees. This contradicts the essence of the PPP, which is to have those who cause environmental damage bear the costs of avoiding or compensating efforts to stem pollution. Strict implementation of the PPP prevents public financing of environmental policy and as far as the polluters can be identified, the responsibility must be on them.

Improper market pricing and free access of many environmental resources and services have led to severe over-exploitation which has in turn lead to environmental degradation and continues to risk eventual destruction of environmental resources. Non-adoption of the PPP is caused by a lack of political will as well as political bias towards wealthier members of the society. Most politicians and policy makers lack integrity hence existing environmental policies often fail to protect the environment from damage and also fail to benefit the general public.

Full adoption of the PPP will give pollution control efforts a moral dimension and will be socially accepted. It is worth noting that sustainable development will only be achieved when pollution control and environmental conservation is carried out efficiently and cost effectively by all national and international environmental authorities. The principle of shared responsibility should also be prudently applied in a proportionate and non-discriminatory manner as we adopt PPP.

Wilson Kipkore, Programme Head, Environmental Security and Beatrice Chemutai, Intern, Environmental Security Programme, ISS Nairobi