Plans to allow councils to implement “pay as you throw” rubbish schemes to encourage recycling have finally been given the go-ahead, less than a week after an announcement to proceed with the proposals was cancelled at the last minute by Downing Street.

Changes to the draft Climate Change Bill, published yesterday, allow town halls to pilot schemes where householders would pay a penalty for binning too much rubbish and be rewarded for throwing out less.

The scheme, proposed by David Miliband, the former Environment Secretary, was said to be opposed by Downing Street as too politically damaging before the local elections.

The eleventh-hour decision last Wednesday to stop the plan being announced prompted speculation that it had been dropped entirely. But yesterday a spokeswoman for the Department for Environment, Food and Rural Affairs said that the proposals were back on, although they would be introduced first in pilot form.

The latest move emerged on the eve of a critical report from the Public Accounts Committee, which accuses the Government of acting too slowly to reduce landfill waste.

The apparent “flip-flop” on rubbish charges prompted renewed accusations of dithering at the heart of Government. The Conservatives claimed that the Prime Minister was “bottling it again” on scrapping a bin tax. “The Labour Government has been caught red-handed reverting back to its old ways of burying bad news,” Eric Pickles, the Shadow Communities Secretary, said. “Bin taxes will harm the local environment by leading to a surge in fly-tipping and toxic backyard burning, yet the Government is cynically trying to give this hated tax some political cover by hiding it in its Climate Change Bill.”

The Defra spokeswoman said that details of the schemes have yet to be worked out. She refused to comment on No 10’s position, although it is understood that Mr Brown insisted that the schemes were piloted.

The PAC report calls on the Government to take urgent action to ensure that taxpayers do not have to pay up to £180 million a year in EU landfill taxes. It accuses ministers of reacting too slowly to a 1999 EU directive on reducing landfill waste. It says that there is now a “significant risk” that new rubbish incinerators and compositing plants will not be built in time to meet the targets.

Householders should be encouraged to recycle more waste but this alone will not be enough to meet EU maximum allowances, say the MPs. Under the 1999 EU directive, Britain must cut the amount of biodegradable waste going to landfill from 18.1 million tonnes dumped in 2003-04 to 7 million tonnes in 2010, 9.2 million in 2013 and 6.3 million in 2020.

Edward Leigh, the chairman of the Public Accounts Committee, said: “If the UK misses these targets, taxpayers will have to stump up the money to pay a huge fine to the European Commission. Waste treatment centres around the country will be a critical factor in reducing the UK’s reliance on landfill. The department must start seriously engaging with the obstacles in the way of bringing them on stream. The alternative is a never-ending search for more holes in which to bury our rubbish mountain.”

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