UK EPR Delay: Time to Prepare?
With the UK Government recently confirming a delay to highly anticipated EPR reforms, what does this mean for brands and retailers, is it a welcome respite from higher taxes or extra time to better prepare?
News of the delay to UK EPR leaked to media early March, later confirmed by DEFRA (Department for Environment, Food and Rural Affairs) in the publication of its consultation response on 26th March. Not only has the scheme implementation been delayed from 2023 to 2024, but it has also been diluted from the initial plans, now taking a phased approach, rather than all at once.
The second official consultation on EPR reform closed on 4th June 2021 after receiving 1,241 responses. On 26th March 2022, the findings were eventually published, alongside resignment to the fact that delay was inevitable and full implementation was not feasible in 2023.
Government ministers have been quick to defend the deferral of Scotland’s DRS, citing a ‘perfect storm’ of Brexit, Coronavirus and tax rules.
At a glance, key takeout’s and changes from the original proposed EPR framework are:
- EPR will now be implemented in a phased manner from 2024, rather than this time next year
- A scheme administrator (SA) will be appointed to manage governance and reporting, due to be fully operational by 2024
- Eco-modulated fees based on packaging recyclability will be introduced from 2025, rather than 2024
- The current PRN/PERN system is no longer being scrapped and will continue until 2026/2027 for businesses to demonstrate recycling obligations have been met, pending implementation of a task force and full review
- Mandatory labelling of packaging using OPRL/WRAP guidance will be in place 31st March 2026 (with films and flexibles being exempt until 2027)
- Initial focus will be on household packaging waste and packaging in street bins managed by local authorities, with EPR for commercial waste being deferred until at least 2026
- Payments for household packaging will support recycling collection infrastructure, with additional packaging materials due to be collected such as plastic films and flexible packaging
- Biodegradable and compostable packaging will require to be designated with the ‘do not recycle’ label until sufficient proof can be gathered for safe collection and separate disposal
- Under the new scheme, all households will be able to recycle the same packaging at home (this also supports separate government proposals and consultations for consistent collections in England, as well as the delivery of similar measures in the devolved administrations)
- The threshold for producer recycling obligations and disposal cost payments at £2m turnover and 50 tonnes of packaging handled each year has been maintained. However, an interim lower threshold of £1m turnover and 25 tonnes of packaging has been introduced where businesses will have reporting obligations but no disposal cost payments
While disappointing, this delay is not at all surprising, especially with the significant delays to long-awaited info on scheme setup and published responses to the 2021 consultation. With many other regulations also coming into force this year, (such as the UK Plastics Tax introduced in April 2022) as well as inevitable delays caused by Covid-19, it was more a case of when, rather than if, EPR would be delayed.
However, taking a phased approach might actually be a logical solution and could enable the packaging/retail industry to fully prepare and mitigate against added cost/taxes (if they act now!). The phasing of EPR can also ensure the UK Government gets the right balance between scheme setup and logistics, ensuring business readiness for each phase through comprehensive communication, and managing/anticipating consumer and cost impact management.
In the run up to launch in 2024, there is now a much greater window of opportunity to clarify, educate and consult with all stakeholders, something the Government has already taken the opportunity to do. Given that PRNs/PERNs are here to stay for at least another 4 years, a consultation has already been launched to ensure the correct refinements and improvements are made to the current system.
And, while brands and retailers may be breathing a sigh of relief at having one more year before EPR, we must absolutely afford to be complacent. This is just one example of how quickly legislation / EPR changes are happening.
It is imperative that manufacturers, brands and retailers stay abreast of all regulations understand what it means to their business and ultimately, their bottom line.
A year may sound like a reasonable buffer right now, but more detailed reporting is still required only 9 months from now, from January 2023. This reporting through the new Scheme Administrator will include component-level packaging data by weight across all packaging tiers, and even goes some way to introduce recyclability reporting ahead of eco-modulation in 2025.
Enablers and disruptors to recyclability will need to be declared as part of packaging submissions, which is a level of detail that many businesses simply don’t collect right now. At the end of the day, eco-modulation is still coming sooner than we might be ready for, and it is likely to be as robust, (if not more so) as many successful schemes in Europe.
At Sun Strategy, we would strongly advise using this time to look more closely at to these existing EPR frameworks for learning and preparation, although the fees and criteria of the UK scheme are still to be announced, they are likely to follow the same mechanism to encourage design for recyclability.
Overall, the slight delay to UK EPR absolutely must be used as an opportunity, it would be foolish for businesses to take their foot off the gas now. By gathering a comprehensive data baseline and having a real-time view of your packaging portfolio, changes can be made now to mitigate EPR and eco-modulated fees before they are even enforced.
Ultimately, now we have a unique opportunity for brands and retailers to get ahead and ‘EPR-proof’ their packaging portfolios, whilst also promoting more sustainable, responsible and circular packaging choices for their consumers.
If you would like to keep up to date with rapidly changing global legislation, please check out our Horizon Scanning quarterly update.
To help our clients manage their packaging data, e-halo combines consultancy services with a technology solution designed to manage future technical and sustainability packaging requirements for brands and retailers. To find out more, please watch the video below or get in touch at email@example.com.
About the author
Gillian Orr – Lead Sustainability Consultant
Gill is a lead consultant, dedicated to providing clients with sustainable packaging strategy, process mapping / improvement and decoding the complex arena of global packaging regulation. She has experience across FMCG, food service and branded clients globally, implementing teams, processes and strategies to drive efficiency while ensuring transparency and integrity of packaging data through technology. Her solution-led, detail-oriented and collaborative approach ensures our clients receive the best possible advice to meet their sustainability targets and reduce waste - in all senses of the word.
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