Whilst schemes such as the more controversial congestion charge have encouraged citizens-cum-consumers to take more personal responsibility for their externality-generating behaviour by increasing the private costs to the polluter, I'm not convinced that the model can successfully be utilised for all types of environmental issues.

Take the age-old problem of tipping household waste into land-fill sites. Recent EU legislation has increased the costs to local councils of dumping waste and rightly so. In response (and this varies from local authority to local authority), many councils have imposed new bin collection regimes which serve to limit the amount of general waste that is collected, thus forcing households to change their behaviour and recycle more. As a result of this we've seen huge increases in the level of recycling.

DEFRA, not wishing to rest on its laurels, now wants to drive recycling further and ingrain it in the national psyche. Whilst this is admirable, their potential "pay-as-you-throw" solution is not at present the best answer for this.

Under "pay-as-you-throw", households would face varying rates of council tax depending on the amount of general waste that is collected from them by the council. Those who recycle a lot, and throw little into land-fill sites would get a discount on their council tax. Those who don't will pay the normal stated council tax amount.

Yet I see two problems with this:

1. The "free-rider" problem - where individuals have an incentive to dispose of their waste in other people's bins, thereby attempting to recoup the financial benefits of the scheme without adjusting their behaviour (hence at the extreme the impact on the environment would be marginal)
   
2. Community relations degeneration - given the free-rider problem can occur, refuse collection could cause the social fabric of local community to breakdown. At the extreme, neighbours will be pitted against each other as they attempt to fill each other's bins with general waste. I don't think a Labour government should advocate such selfish community interaction, or go down a path that could theoretically lead to such a state-of-the-world.

I do not think these issues are fatal to the general concept. But until these issues are satisfactorily resolved, I do not believe "pay-as-you-throw" should be introduced.

In short, as it stands, it is a rubbish idea.