WRAP's vision for the UK circular economy

Economic benefits

The adoption of a circular economy offers considerable economic benefits; Defra calculates that UK businesses could benefit by up to £23 billion per year through low cost or no cost improvements in the efficient use of resources, while McKinsey estimates that the global value of resource efficiency could eventually reach $3.7trillion per year.

The diagrams below shows how the UK economy could be transformed were it to really embrace the concept of circular economy model and build it into the heart of its thinking:

Material flows in the UK 2010


Materials flows in the UK 2020

We would like to note that the materials flows on the 2010 Sankey diagram is not completely consistent around the bottom of the loop.

This is because the waste arisings and waste management numbers are taken from completely different datasets, which do not overlap in terms of source or geographic range.

Our vision for UK’s economy by 2020 assumes (compared to a 2010 baseline):

  • 30Mt fewer material inputs into the economy
  • 20% less waste produced (50Mt less waste)
  • 20Mt more materials recycled back into the economy

Based on 2011/12 actuals, the Office for Budget Responsibility’s forecast for 2013-17, and assumptions of 2% per annum GDP growth for 2018-20, current economic data suggests that GDP will grow between 15 -20% in the 2010-20 decade.

The Office for National Statistics predicts that UK population will grow by 8% in the decade.

The headline 30Mt less materials going into the economy is close to WRAP’s 2010 research Securing the Future: The Role of Resource Efficiency.  This identified potential savings of 38Mt for selected materials by 2020 based on quick win resource efficiency actions. This included several materials considered as being of strategic importance, such as rare earths. 

Four key ways of realising these savings are:

  • lean production (i.e. making goods with a lower material requirement);
  • reducing waste in manufacture and commerce;
  • reducing the amount of working products thrown away, and; 
  • goods to services (i.e. increasing the proportion of some products which are leased).

The increase in waste recycled (20Mt) is less than for the 2000 to 2010 decade (70Mt). We suggest that the easy wins in recycling have been achieved, especially with the landfill tax escalation during the decade and greater business awareness of the economic benefits of diverting waste from landfill.

20% less waste produced is about 50Mt less waste. This will require ambitious waste prevention plans from all nations to set the framework for business and public sector to take action.