The revelation the UK’s extended producer responsibility (EPR) scheme will function more as a tax than a tool for improving recycling is deeply concerning, to say the least. When EPR was first drawn up, it was supposedly designed to drive higher recycling rates, incentivise companies to produce sustainable packaging, and ensure that those actually investing in better waste management were fairly rewarded.
Instead, we are faced with an ill-conceived policy. Even the Treasury’s own spending watchdog admits it will burden businesses without delivering the environmental improvements it was designed to achieve – something many in the industry feared from the outset.
Small businesses have voiced their concerns over the financial strain this reversal will place on them, with no clear benefit to recycling rates. It is alarming that the estimated cost of EPR will rise by £200m beyond the government’s previous projections, reaching an average of £1.6bn per year between 2025-30.
Not only is this an unsustainable financial burden, with no corresponding investment in improving recycling infrastructure or waste management efficiency, but a huge missed opportunity. It reflects, once again, government lacking imagination, ambition, and a real understanding of what it takes to implement meaningful change. The UK’s recycling infrastructure has suffered from chronic underinvestment for years, and rather than using EPR fees to correct this, the government now appears to be repurposing them elsewhere – where, I ask?
It was only last week our secretary of state for environment, food and rural affairs, Steve Reed, pledged to unlock innovation with technologies to open new revenue streams, implement the right infrastructure, and “show the public that the circular economy is not some abstract concept”. That was evidently nothing more than hollow, hypocritical rhetoric.
If EPR is to be fit for purpose and succeed, it must be underpinned by data-driven accountability. Without robust, transparent data collection at recycling centres, funds cannot be fairly distributed to those councils, operators, and businesses that are genuinely driving progress.
The industry was led to believe EPR would support a circular economy. Now it’s simply becoming a stealth tax. If the government cannot ensure these fees are reinvested into improving recycling, the policy needs a fundamental rethink. Otherwise, more money will be wasted and the businesses that form the backbone of our economy, and keep the country running, will be unfairly burdened.
Businesses across the sector are right to be frustrated. A u-turn of this scale undermines confidence in the government’s commitment to environmental progress and risks stalling innovation at a critical moment. The packaging sector, and the public, deserve better.
Alice Rackley is the CEO of Polytag
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