Food and drink bosses will today threaten to withdraw support from its extended producer responsibility (EPR) scheme unless ministers promise to take concerted action to mitigate its impact.
The Food & Drink Federation (FDF) will tell circular economy minister Mary Creagh that patience has run out among manufacturers, as well as retailers, as the £1.4bn bill due to hit companies in October gets ever closer.
Until now the FDF has supported EPR, despite other bodies such as the BRC and the WSTA calling for it to be delayed, amid fears over the impact on inflation.
However, it said the time had come to take a tougher line and whilst it still supported the principle of producers paying for recycling the packaging they produced, they could no longer support the scheme unless the government swiftly announced measures including fast tracking approval for chemical recycling.
It also demanded ministers “ringfence” funding so the money doesn’t become a tax to pay for fixing potholes and propping up cash-strapped social care.
The FDF has chosen a key moment to make the move, at the Packaging Innovations conference at the NEC in Birmingham today, which is celebrating the launch of PackUK, the body set up to administer the controversial scheme, of which it is a key member.
Jim Bligh, director of packaging at the FDF, will tell Creagh, who is chairing the launch event, the “time for talk is over – now is the time for action”.
Bligh is expected to say: “We support EPR because it is a proven way to build a circular economy for packaging recycling, which we want and need.
“But manufacturers’ support [from now on] is conditional on governments and Pack UK making our large investment worth it.
“With an annual bill of £1.4bn coming at a time when commodity prices remain high, wage costs are going up significantly, and taxes are rising through increased NICS, we fully expect EPR fees to feed into increased food and drink prices this year, too, at a time of rising inflation.
“So it is imperative that industry’s investment in recycling is matched by real action from central and local governments all across the UK.”
The FDF says its conditions won’t be met unless ministers promise to “turbocharge” efforts to attract investment into a modern recycling infrastructure, unlocking the potential jobs and investment that has been promised.
Key to the call is the government accelerating mass balance accounting and chemical recycling with a demand that HMRC speeds up its process of accepting mass balance accounting to six months, rather than four years.
But Bligh will also accuse ministers of failing to take concerns from the industry seriously, saying it would be a disaster if “EPR fees fund potholes and social care.”
“Revenue from fees must be ringfenced, so money spent on recycling by producers is spent on improving the recycling rates we are now legally liable for,” he will say.
The FDF’s tougher line comes with growing anger from other sectors.
Earlier this week retailers including Tesco, M&S and B&Q accused ministers of creating a “perfect storm” with the costs of EPR and DRS on top of measures in the Budget.
M&S chief executive Stuart Machin accused the government of “raiding retail like a piggy bank”.
A senior retail source told The Grocer: “Retailers are not seeing this as a levy, it is a tax and customers at the end of the day need to know that, because they are going to pay more every time they go into stores, but it’s not going to make a jot of difference to the quality of recycling unless the government shows it can take the industry’s concerns seriously.”
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