Pack waste rule change may hike cost

By Paul Gander

- Last updated on GMT

Extended Producer Responsibility for plastic packaging could significantly increase costs for manufacturers
Extended Producer Responsibility for plastic packaging could significantly increase costs for manufacturers

Related tags: Packaging

Moving to a single compliance point for Extended Producer Responsibility (EPR) regarding local authority-collected packaging waste could hugely increase costs for food and drink brand-owners, according to sustainability experts.

The Government has said EPR will recover the “full net cost​” of collection and initial sorting of domestic packaging waste from business. Up to now, the much lower fee burden has been distributed across the entire packaging supply chain.

However, as waste compliance consultancy Ecosurety reminded Food Manufacture, the UK is due for new EPR regulations from 2023.

Increased costs

“It is highly likely that costs for businesses selling packaged goods will increase significantly, by at least tenfold, compared to 2017 figures,”​ said head of policy Robbie Staniforth.

“If Government chooses to move to a single point of compliance, where one business picks up all the costs, the increases for the sector chosen could be even greater.”

Government consultations last year on EPR gave two options for single-point compliance, he said: ‘brandowner’ or ‘seller’. Over half of respondents preferred ‘brandowner’, with only 12% selecting ‘seller’. However, sharing costs across the supply chain remains an option.

Plastic tax

From 2022, the Plastics Packaging Tax, confirmed in the March Budget, will add costs of £200 per tonne of plastics packaging containing less than 30% post-consumer recycled (PCR).

With that in mind, there are concerns that manufacturers currently using a higher percentage will drop it back to 30%, and use the in-demand surplus PCR elsewhere, Staniforth pointed out.

In a recent report, sustainability consultancy Sancroft estimated that, in order to cover local authority costs of £1.5bn, the advent of EPR in 2023 would increase packaging costs for businesses to 21 times 2017 levels.

The food and drink industry could not absorb this increase without it being reflected in their prices – of both the packaging itself and the final product sold on shelves,”​ said Sancroft senior consultant Dom de Ville.

Related topics: Packaging & Labelling

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