With a lack of efforts to encourage the circularity of production from the product design stage, the Member States of the European Union are virtually at a standstill in their transition to a circular economy, despite more than €10 billion of EU funds mobilised for this purpose between 2015 and 2020 under the first circular economy action plan, points out the European Court of Auditors in a special report (17/2023) published on Monday 3 July.
In these conditions, the Court of Auditors warns that it is virtually impossible for the EU to meet its target of recycling twice as much material by 2030 and putting it back into the economy instead of wasting these resources, as set out in the second circular economy action plan, adopted in 2020 (see EUROPE 12444/1).
The Court of Auditors wanted to know whether the European Commission’s action has had a real impact on circular economy activities in the Member States. Its audit covering the period 2014-2022 focused on the Commission’s actions related to product design and production included in its first action plan from 2015, which targeted sustainable economic growth, job creation and European competitiveness (see EUROPE 11444/5). The results are not very encouraging for the future.
The European auditors noted that between 2015 and 2021, the average circularity rate for all 27 Member States increased by only 0.4%. Seven countries - Lithuania, Sweden, Romania, Denmark, Luxembourg, Finland and Poland - have even regressed.
On a positive note, however, the report notes that by June 2022, almost all EU countries had a circular economy strategy or were on the point of having one.
EU money used for waste management instead of prevention. More than €10 billion of the 2014-2020 budget has been mobilised to encourage investment in green innovation. However, the Member States have allocated the vast majority of these funds to waste management rather than waste prevention through circular design, which would probably have had a greater impact, point out the auditors.
The two EU action plans also include a range of measures to promote innovation and investment, but there is little evidence that they have contributed to the circular economy. These measures have had, at best, little impact, for example helping companies to supply safer products or to access innovative technologies designed to make their production processes more sustainable.
An incomplete framework for monitoring progress. The report also points out that the Commission’s monitoring framework, which was being revised at the time of the audit, left something to be desired in that it did not take account of all the essential aspects. According to the auditors, specific indicators for the circular design of products were missing.
“If the EU is to become economical in its use of resources and achieve the environmental objectives of its Green Deal, it is fundamental that it maintain the value of materials and reduce its waste to a minimum”, said Annemie Turtelboom, the member of the European Court of Auditors responsible for the report. She added: “So far, however, the EU’s action has not borne fruit, and the circular transition is unfortunately virtually at a standstill in European countries”.
Recommendations. The Court of Auditors therefore makes two recommendations to the European Commission.
It recommends that the Commission improve its monitoring of Member States’ transition to a circular economy in order to support informed decision-making on new policies, initiatives and actions.
In addition, it recommends analysing the reasons for the low take-up of EU funding for circular design as well as examining the possibilities for strengthening incentives for circular design.
View the European Court of Auditors’ report: https://aeur.eu/f/7vs (Original version in French by Aminata Niang)