Trouble's BREWing; Environment 'Recycled' landfill tax cash axed.

Byline: By JEZ DAVISON

TEES businesses looking for "green" grants have been dealt a blow by the Government's decision to collapse a key funding programme.

The Department for Environment, Food and Rural Affairs (Defra) set up the Business Resource Efficiency and Waste (BREW) programme to recycle cash raised from landfill tax levied on business. It was intended to be used as an incentive for firms to introduce energy-saving and other measures that helped the environment.

Last year, regional development agency One NorthEast distributed pounds 1.1m from BREW through its MIDAS programme, which helps companies to reduce costs through energy, water and waste reduction. But the first it knew of the funding stream being axed was when its application for pounds 880,000 from BREWfor 2008 was rejected.

It said it was worried that the decision would undermine the sustainability of local businesses.

A One NorthEast spokesman said: "Clearly, we are very disappointed about Defra's decision. We're carrying out a detailed assessment of what this will mean for the agency's work and our priority will be to minimise the impact.

"The Comprehensive Spending Review set out the much tighter financial framework in which we will be working in future, and this once again reinforces the need to make sure our resources are channelled to achieve the best possible outcomes for the region."

The collapse of the programme means MIDAS will have to support businesses through existing non-BREW funds.

A Defra spokesperson said she had "no idea" whether the BREW funds would be made available through a different mechanism. The Government came under fire following last week's budget for failing to ring-fence similar green taxes for environmentally sustainable projects and using them instead to bolster the Treasury's growing shortfall.

"Other programmes and organisations that exist underneath BREW, such as Envirowise, will continue to exist," said Defra. "It is too early to say how the funds will be allocated after April 1."

Fiona Hall, Lib Dem MEP for the North-east, accused the Government of "siphoning off" funds for public spending. She said: "The truth is that Defra has a hole in its budget and is raiding the BREWfund in order to fill that hole. Diverting funding away from resource efficiency is extremely short-sighted. This cut comes at a time when businesses are struggling to cope with ever-rising energy prices."

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MUCK AND BRASS: Cash raised through landfill taxes will no longer be recycled through Business Resource Efficiency and Waste funds, which had been used by firms to introduce 'green' measures Picture by PETER REIMANN