Packaging Manufacturers: Extended Producer Responsibility
House of Commons · Commons Chamber · 1 Jul 2026 · 44 speeches · Official Report
Motion made, and Question proposed, That this House do now adjourn. -(Gregor Poynton.)
I am very grateful that you have granted tonight’s debate, Madam Deputy Speaker, and that we have so much time to discuss this important issue. Packaging extended producer responsibility, which I will call EPR, is a policy that genuinely has a laudable goal: the move towards a circular economy, in which recycling is the norm, waste is minimised and we shift away from environmentally harmful materials such as plastic-something that the House can get behind. If done right, EPR could deliver just that, but the reality of the scheme now being implemented by the Minister is altogether different. We are seeing jobs being lost, British businesses losing contracts and investment, an increase in carbon-intensive glass being imported and, ultimately, producers switching from infinitely recyclable materials to plastic.
I appreciate the hon. Lady giving way so early in her speech, because I have to run to a Delegated Legislation Committee. I agree with all the points she is making, but would she talk later about the impact on the pub trade? This policy will hit the pub trade by about £50 million-it is going to do some real damage to a very important industry.
I will indeed be talking about the pub industry. I thank all the Members who have been campaigning so hard on this particular point for the last two years. The hon. Member will need to read the speech afterwards-it will be brilliant. We will try to protect our hospitality industry. While this debate is not focused on a single material, I must declare a particular interest in glass. Next month, I will be really proud to attend an event marking the 275th anniversary of the founding of Beatson Clark. Since the earliest days of the industrial revolution, it has been manufacturing glass in my Rotherham constituency, providing generations of skilled, well-paid jobs to my constituents. Throughout world wars, economic decline, depression and indeed renewal, it has endured, helping to drive our regional economy. I say to the Minister that I want Beatson Clark to thrive for another 275 years, but the reality is that the EPR is placing that future at risk.
A plethora of interventions, but I have to go to the sister at the back first.
In my constituency, I also have a phenomenal glass manufacturer, called Encirc. It has three sites across the UK, employing over 2,000 people. It is unfairly penalised by this tax, because it is about weight. As the hon. Lady has pointed out, this is encouraging manufacturers of things like tonic to switch to aluminium and plastic, which are infinitely less recyclable than glass. It is also competing against imports from countries like Turkey, so not only are we facing the increased carbon emissions from shipping over the glass, but the glass is less pure and is therefore not as recyclable. I would ask the Minister urgently to look at this tax-I have already asked for that-and very quickly to bring in a 75% reduction while she considers its overall implications.
I hope to amplify the hon. Lady’s points later in my speech. Glass is not just another packaging material; it is infinitely recyclable.
I wanted to give the hon. Lady a chance to get back into the swing of things before intervening, but as she is talking about a valuable business in her constituency, let me say that the pub and brewery sector in Woking represents £100 million and 1,800 jobs to our local economy; those numbers used to be higher but, sadly our small brewery, Thurstons, had to close. The EPR was one of several factors that hit that brewery. Does she agree that we need a change from the Government on the EPR, as well as wider support for the sector?
I completely agree. Trying to level the playing field on this EPR measure is the one thing that I hope the Minister will give us comfort on today. Our hospitality industry is really suffering. More generally, I worry where the remaining places of community are in our towns, cities and villages. If we are not protecting the ones we have-the few we have-it is going to be a very dark future. Let me now get back to glass.
The hon. Member is being very generous in giving way, and she is making an excellent speech. I think we would say that the cost of food right now is the No. 1 issue for all our constituents and that household budgets are very tight. Does she agree that this is a bad time to be implementing this tax, whatever its merits may or may not be? The Bank of England estimates that it will add 0.5% to food price inflation, and that food prices could rise by 7% over the next 12 months. Households on very tight incomes are going to be squeezed as a result. Would it not be better either to cancel this measure, or at the very least not to implement it at a tough time like this?
As I said, I think the principles of the scheme are laudable. What frustrates me is that it is disincentivising using renewable materials, which in the long term are much cheaper. Instead, it is driving businesses to plastics, which have a very real cost on our environment as well as on our pockets. The Minister needs to do anything she can to mitigate that risk, but I hope this debate will grant her the opportunity to do so in a fair and equitable way. Glass supports a circular economy. It underpins supply chains across food, drink and pharmaceuticals. We all support the principle underpinning the EPR-that those placing packaging on the market should pay towards its collection-but, as Members have said, the weight-based fee structure that the Government have chosen to utilise disproportionately penalises glass, making glass significantly more expensive per unit than lighter, less sustainable alternatives like plastic.
I congratulate my hon. Friend on securing the debate. I declare an interest as the chair of the all-party parliamentary group for packaging in the circular economy. Like her, I have engaged extensively with manufacturers across the supply chain. They support the EPR in principle but raise concerns about its implementation. Businesses need predictability, transparency and confidence. The current plan for annual adjustments to the recyclability assessment and methodology provides concerns about the long-term capital certainty that our factories need in order to reinvest. Does she agree that it would be helpful if the Government would commit to periodic, rather than annual, methodological changes and a comprehensive post-implementation review covering manufacturing, employment investment and material inflation?
I absolutely agree with my hon. Friend’s points. The methodology throughout-I will come on to it later-has been flawed, if not straight wrong in some cases. I would much rather that the research he is talking about-on the methodology-was done years in advance, rather than on the hoof as seems to be happening now. The Government seem to be suggesting that they will retrospectively look at what is happening and make adjustments, but unfortunately for a business and its bottom line, it is not possible to retrospectively charge people for something the Government choose to modify. Let me state one inescapable fact. Glass is heavier than plastic-it simply is. By choosing to base fees on weight rather than on units, which they could have done, the Government are pushing businesses towards switching to a cheaper, less recyclable and much more environmentally harmful packaging. The industry has been told by the Department for Environment, Food and Rural Affairs that the modulation of fees will save glass, but let us be honest: this is too little, too late. Why not get the scheme right at the beginning, rather than trying to modify it later?
One of the largest employers in my constituency is Bostik, which is famous for Blu Tack. It also produces quite a lot of adhesives used in the DIY and home repairs sector. Bostik agrees with the scheme-it does not oppose the scheme in and of itself-but it does see one issue: although 95% of the company’s products go to site and are used by professionals, it will be charged the EPR on 100% of its products because it cannot trace every single item. It therefore supports the Builders Merchant Federation’s argument that commercial and industrial packaging should remain outside full cost recovery, because trade packaging waste is already covered through merchant distribution. Does my hon. Friend agree that the Government could consider that in the implementation stage, right at the beginning of the process?
My hon. Friend makes a point that I was not aware of. I have been in contact with loads of different industries, but not that particular one. It seems as though it is the same sort of double payment that hospitality is facing. That absolutely needs to be addressed. Businesses have also been told that they need to move towards reuse systems. I am sure that both the points we are raising will be mentioned by the Minister in her response. It is true that glass is the perfect material to reuse, but it is not within the power of the glass manufacturing sector to force producers to move to use reusable bottles. Let us be honest: widescale reuse systems in the UK will take significant buy-in from the whole supply chain and will take at least a decade to become a reality, by which point-let me also be honest again-we will not have a glass manufacturing sector in the UK to supply the reusable glass packaging. The signal that the Government are giving to businesses is clear: switch away from glass right now. The result? We are seeing an evident and accelerated shift away from UK-made glass towards both cheaper imports, which now account for-I am really surprised by this-14% of the market, and increasingly towards plastic.
I thank my hon. Friend for her tireless campaigning on this issue. We are joined in the Public Gallery by GMB glassmakers-I declare an interest as a GMB member-who are at risk of losing their jobs if the measure goes ahead in its current form. Will my hon. Friend recognise the human impacts that could come if we do not see a change in policy, and pay tribute to those workers in the sector and GMB for their campaigning?
I absolutely support what my hon. Friend says. GMB and Beatson Clark have been fantastic on this issue, as have other unions. We should never forget the human impact of the debates that we have in this Chamber. When we talk about numbers, percentages and import tariffs, we forget that it is the people making the products who are suffering the most and facing the uncertainty. A survey conducted by British Glass found that nearly half of businesses say that they have already switched away from glass, or plan to do so, due to EPR fees. Once those decisions are made, and once investment is committed to new packaging formats, they are unlikely to be reversed. Glass manufacturing is not easily replaced. Furnaces represent long-term capital investment-often hundreds of millions of pounds. Decisions about whether to rebuild or reinvest are already being delayed or cancelled, meaning hundreds of millions of pounds of investment in the UK is already being lost. When production shifts overseas and capacity is lost, it is almost impossible to rebuild. I am not talking about short-term disruption. I am talking about permanent industrial decline. If left unchecked, the policy will not just reshape the packaging market; it will hollow out an entire industry. With that decline, as my hon. Friend the Member for Burton and Uttoxeter (Jacob Collier) said, comes something even more serious: job losses.
In my constituency we have three breweries-Verdant, Keltek, and St Ives Brewery based in Hayle. Does my hon. Friend agree that those breweries are about not just producing excellent product-which they all do-but the communities that grow up around them? Does she agree that there is a risk of social damage if we are unable to support those small breweries, and that this proposal risks that happening?
That is absolutely my concern. People do not talk about the impact on the supply chain. We already know that at least 350 jobs-more than 5% of the direct workforce-have been lost so far, but we do not know about the impact on the supply chains and associated businesses. These are not abstract numbers; these are well-paid, highly skilled manufacturing jobs, concentrated in industrial communities like mine, where, to be honest, such opportunities are at a real premium. Since I first raised these issues nearly two years ago, I have been contacted by a range of businesses and industry groups, including: UK Hospitality, the British Beer and Pub Association, the UK Spirits Alliance, the Society of Independent Brewers and Associates, O-I Glass, the Scotch Whisky Association, the Wine and Spirit Trade Association, GMB, Unite, AB InBev, the all-party parliamentary beer group, the APPG on packaging in the circular economy, the Packaging Federation, Teva Pharmaceuticals, British Glass, and the Campaign for Real Ale. Their concerns are strikingly similar. The EPR is not just affecting glass. Across the packaging sector, businesses are struggling in the face of this poorly designed, poorly implemented policy. Graphic Packaging International employs 57 people in my constituency, and upwards of 1,700 across the UK. It produces a range of fibre-based packaging for household goods, supplying major UK retailers with sustainable and innovative products, which are largely made from renewable or...
I thank the hon. Lady for being so generous with her time. I remember her making the same points in her Westminster Hall debate on the EPR back in May 2025. I made similar points in my Westminster Hall debate on beer tax-draught duty-in which we also talked about the EPR. Does the hon. Lady agree that it is really disappointing that a year on, the Government, and DEFRA in particular, have not listened to our concerns?
I think it is infinitely more than disappointing, but I will follow the hon. Member’s parliamentary language: it is hugely frustrating. Colleagues here are raising the real, human costs of that. Something needs to change, and I do not want that change to be us losing our hospitality and renewable packaging industries. Hospitality businesses have faced similarly unfathomable logic from DEFRA. EPR fees are meant to offset the cost to local authorities of handling and recycling waste. Hospitality businesses’ waste is not collected through public collections, but through commercial waste removal contracts. Yet perversely, the annual burden to British pubs for EPR fees has been estimated by the British Beer and Pub Association to be £50 million. Hospitality businesses are, in effect, being told to pay for the same thing twice. DEFRA has long been aware of this anomaly-I thank the hon. Member for Woking (Mr Forster) for his debate on it-but nothing has been done to address it. Packaging EPR fees will disproportionately affect generic medicines, where high-volume, low-margin products risk becoming commercially unviable, increasing the likelihood of supply disruption, medicine withdrawal from the UK and higher costs to the NHS. Medicines manufacturers have minimal flexibility to redesign packaging, because primary packaging is tightly regulated by the Medicines and Healthcare products Regulatory Agency. The Government’s one-size-fits-all approach is revealed again when we consider...
I wanted to pick up on the hon. Lady’s point about the complexity of the scheme, on top of the additional costs for small businesses. I have a fantastic vineyard in my constituency called Camel Valley, which has talked about spreadsheets being almost matrix-like-branded, non-branded and so on. It is so complicated for businesses to understand. Does the hon. Lady agree that as well as the punitive costs on our fantastic local breweries, vineyards and other businesses that she has described, it is the complexity of the scheme that is really holding back so many amazing businesses?
I completely agree with the hon. Member’s points, because I agree with the polluter pays principle-I believe that is at the heart of this issue-but the people who are paying are our workers, our hospitality businesses and the poorest people in the world who would have been getting £1 million. They are the people paying, not the polluters, because this policy is perversely driving businesses to using plastic, which surely is the exact opposite of what it should be trying to do. With all of that in mind, it is hard to escape the conclusion that this is a poorly designed and implemented policy which is having a severe negative impact on British businesses. Despite these concerns, DEFRA has argued that the EPR will in fact create jobs, but that claim simply does not stand up to scrutiny. The figures are not based on official calculations and, critically, the jobs referenced are not comparable to those being lost. They are more likely to be lower-skilled, lower-paid roles in waste management, often at entirely different locations. These mythical jobs will not deliver the same economic value, will not support exports, and will not provide the same level of regional resilience. I must be very clear: we cannot replace high-skilled manufacturing jobs with lower-value roles and then claim an economic net gain. That is not growth; that is managed decline. The EPR is also adding significant inflationary pressures that will be reflected in consumer prices. Producers expect to pass on the...
I will be brief, because I know something else is happening this evening that others want to engage in. I am not entirely sure what that is, but apparently it is quite popular. I congratulate my hon. Friend the Member for Rotherham (Sarah Champion) on securing this debate. I know about the glass industry and she has rehearsed some of the arguments in particular for producers of beer. I have had similar correspondence from various agencies about the perversity of a weight-based system that precludes the use of a product that is infinitely usable and moves manufacturers towards plastic and thinner aluminium products because it is cheaper. I am sure the Minister will comment on that. I want to talk about two things. I must first declare an interest as the vice-chair of the all-party parliamentary group on packaging in the circular economy, which is chaired excellently by my hon. Friend the Member for Redditch (Chris Bloore). I think it is quite clear that this is a good policy and a good system but that it has had some unintended consequences. We are trying to iron them out for the benefit of all. In my constituency I have one of Premier Foods’ Mr Kipling factories. It has done a considerable amount of work on reformulating its plastic from red trays so that it can be recycled. It has also looked at how it can use cardboard better. It has looked at the use of its plastic film, which is really important for the freshness of its products, but that is obviously a product that it...
It is a pleasure to speak on this issue today. I thank my hon. Friend the Member for Rotherham (Sarah Champion) for securing this debate, and I thank all hon. Members who have spoken. We have heard from powerful advocates for the glass industry, the fibre-based composites industry, the ceramics industry, the wine industry in Cornwall and, of course, the beer and pub industry, which we are all hoping to go and enjoy shortly. Let me begin by also declaring my interest as a member of the GMB trade union. I recognise the challenging context in which the glass industry operates; that is a result of a range of global pressures, including the international increases in energy costs, volatile commodity prices, growing international competition, and substantial investment in decarbonising energy-intensive manufacturing processes. I also recognise and acknowledge the industry’s concerns about packaging extended producer responsibility, or PEPR, which is an internationally recognised model used in more than 30 countries to transform recycling services. The model shifts the cost of managing packaging waste from taxpayers-that is us-to the producers who put it on the market. It is the “polluter pays” principle in action. Its introduction in this country is the biggest change to recycling policy in 25 years. The policy was formulated under the previous Conservative Government. The right hon. Member for Newark (Robert Jenrick) is no longer in his place, but it was his Government who first...
Can the Minister tell us whether that will be the 75% discount that the glass industry is asking for? Does she know what the falling rates will be, please?
Again, we have a complex system. I would very much like to give my hon. Friend the amounts per tonne, but that is not possible, much though I would like to give her comfort, until all packaging producers have reported their data in the autumn. We will then issue the invoices. I can say that the proportion that the glass sector will pay will fall year on year. We have been listening very carefully to the glass industry on that issue. PackUK, the scheme administrator, and officials at the Department for Environment, Food and Rural Affairs meet the glass sector and British Glass regularly, and PackUK ran a workshop just this week, which included British Glass, on how we can drive the use of more recyclable materials. Everything that PackUK does is subject to four-nation agreement. We had a meeting this morning with the devolved Governments, at which we talked through some of the issues. Wales, Scotland and Northern Ireland face very different challenges, and the challenges of collecting in inner-city London are not comparable to those of collecting waste in the Outer Hebrides. The model is therefore complex from the recycling and collections point of view as well. Returning to glass, PackUK and DEFRA officials will visit Ardagh Glass later this month. The visit was due to take place in June, but it was rescheduled at Ardagh’s request. PackUK also visited Encirc in Northern Ireland last month. I have spoken to the hon. Member for Runcorn and Helsby (Sarah Pochin) about the issue...
Will the Minister give way?
I want to make a little bit of progress, if I may, because it is four minutes to kick-off.
We have two and a half hours, Minister.
I want to make some progress, and my hon. Friend may find that I answer her questions. PackUK has today published improved guidance on how recyclability will be assessed and rewarded. The glass section was developed in close collaboration with the glass industry and we have already received positive feedback. I hear what my hon. Friend the Member for Stoke-on-Trent Central (Gareth Snell) said about wool. When I see wool used as a coolant, it tends to come in plastic packaging, for hygiene reasons. That packaging can certainly be open up, and the wool can then be composted, but there is usually a film around it, and under the recyclability assessment methodology, that would incur higher fees. All this is meant to incentivise design for recyclability. I was due to meet a wool insulation provider this week. Sadly, I was not able to, but she was on her way down, and I believe that she met officials. I will check that later. I am keen to do work on this issue, because it is particularly important for the British wool industry, with wool at such rock-bottom prices. We are planning to launch a call for evidence this year to gather industry views, which will inform how we continue to reward the right choices. On the post-implementation review, it will be conducted and published in the normal way, three years after the regulations came in. That is slated for December 2028.
It is reassuring that we are going to have the consultation. Would it not have been much better to have had it before the scheme was implemented? The Minister mentioned a meeting with my constituency business, Beatson Clark. That meeting only happened because I urged the previous Secretary of State and the Minister to make it happen, and I assume that the other examples of meetings that have taken place, or not, have been at the insistence of MPs. Why was that work not done before the scheme was rolled out?
I cannot speak for what happened under the previous Administration, but I can tell my hon. Friend that the scheme was announced in 2018, and a consultation happened in 2019. There was another consultation, but I cannot find the exact part of my pack on that. There was a full impact assessment of PEPR published in October 2020, setting out the expected overall costs to businesses. At that stage, it was not possible to assess the impact on specific sectors or regions, as fees and modulation had not been finalised. This has been a huge infrastructure project change, and a huge system change. The Environment Agency, acting as the regulator, holds the database of everyone who is a packaging producer. Elsewhere in the waste and packaging sector, we see large issues around avoidance, free riding and other issues, so we had to go through a massive piece of work with our regulator to ensure that everyone who is putting packaging on is meeting their obligations. There were public consultations in 2019 and 202,1 and a consultation on draft regulations in 2023. There was a consultation with British Glass on the decision to use volume in the apportionment of kerbside recycling collection costs in July 2024, prior to the release of the initial set of illustrative base fees. I think that there was perhaps a misunderstanding, given that this had all been thought about and discussed for five or six years, that it was never going to happen. To be fair to the smaller companies, perhaps they...
I genuinely thank the Minister for being generous with her time. On the idea of a post-implementation review, is there a way of looking at the time that businesses have to spend interacting with the scheme? The Titanic brewery in Stoke-on-Trent-very good beer, by the way-has told me that it took three weeks of one employee’s time to complete the assessment for the first year’s fees. I am sure that that is not by design, but in the review, will the Department look at how to make interaction with the scheme easier for small businesses that do not have much capacity?
My hon. Friend makes an excellent point, and this is something that I have been insistent with officials on. This is a complex scheme, and the more complexity we add into it, the more time it will take. There is a trade-off here, and a set of difficulties, because we can do carve-outs for x and y sector, but that creates more complexity in the recycling assessment methodology calculations for other parts of the packaging industry. We have to beware of making perfection the enemy of the good. I can also let my hon. Friend know that the chief executive officer of PackUK, Jeremy Blake, met the WoolCool CEO yesterday. I thought that had happened, but I am glad to have got the note telling me it is true. Beyond this, we are supporting the glass businesses with their electricity costs through the British industry supercharger. Glass businesses now receive 90% compensation for electricity network charges. This brings their total reduction in electricity bills to an average of between £65 and £87 per megawatt-hour. We are also supporting the retail, hospitality and leisure sectors with lower tax rates for their properties. On the issue around cheaper imports coming from overseas, the Trade Remedies Authority’s independent anti-dumping and anti-subsidy investigations into cheaper glass imports from China and Turkey are ongoing. That is dealt with by another Government Department. We are working closely with industry to address the challenge of dual use-packaging disposed of in either...
I am sorry to detain the House. I am not sure if a try has been scored yet, but I am sure somebody will find out-
A try!
The Minister mentioned the super-charger scheme and the impact for glass manufacturers. I know the super-charger scheme is not her Department, but it is only for frontier industries. Can she say whether or not glass bottle manufacturers that go into the hospitality sector benefit from that? My understanding was that they do not because they are not considered one of the glass fibres or the industrial glass needed for the frontier industries.
I am looking to my officials in the Box, and I think it is probably safest if I write to my hon. Friend on that issue. Let me tell the House about the year 1 shortfall in fees. There was a shortfall in the fees this year as we allowed packaging producers to submit their tonnages and then their tonnages reduced because, obviously, they looked at their figures and reduced them. We listened to industry on that. Despite the regulations saying that actually industry should make up any shortfall, my Department took pressure off businesses by funding on an exceptional basis to hold fees down. We are taking steps this year to ensure that we do not have a repeat of that. On early successes, we are hearing about PEPR bringing about change. Councils all over the UK are using this funding from the packaging industry to improve services to local people. In Tameside, the metropolitan council is investing £1.6 million in new vehicles and improved technology to deliver a more reliable service for taxpayers. Councils are investing to improve glass collection directly, which should benefit the industry in terms of the supply of high-quality cullet. For example, Aberdeenshire council is investing £5 million over 2 years to purchase a new three-compartment glass collection vehicle-I hope that is “vehicles”, but it says “vehicle” here-upgrading glass recycling points to reduce contamination, and improving the quality of glass recyclate, which we know really matters to the glass industry.
I thank the Minister for being generous with her time. I am sure she can probably understand why I, Asahi, which is based in Woking, the hon. Member for Rotherham (Sarah Champion) and others are not satisfied with her answers today. I have heard nothing of the double taxation, which is what EPR is. Will she agree to meet me, the hon. Member, other MPs and, more importantly, the businesses impacted to fully understand the impact and to work out a way forward?
Perhaps the hon. Member was distracted when I mentioned the issue of me holding a roundtable with all these industries on this very issue, but I am happy to meet colleagues from across the House on these issues. I explained in the point that he perhaps missed that it is tricky because it has to be regulatable-we have to ensure that the regulator can verify what would happen. Of course, it is a complex micro-econometric model. As soon as fees are reduced in one area, they go up in another area. That is the bottom line on all this.
I might have been distracted in the last eight minutes-I do not know why. I remember hearing that the Minister said she has held a roundtable. I do remember that it was last year, and I am keen for her to meet the stakeholders again before this wider consultation and what happens next-hence my request.
Obviously, I do not sit there and do the maths with people. These suggestions and potential solutions have to be modelled and worked through. We are working at pace to assess whether any targeted short-term measures could be introduced through the forthcoming PEPR amending statutory instrument to partially address the dual-use packaging issue. So we are working on a short-term solution, but we are also working on a longer-term solution, which is the Austrian model that I mentioned. Again, the hon. Gentleman may have been distracted by the whistle when I mentioned that. Councils across the country are rebranding and upgrading their glass recycling points to make it easier for households to use glass recycling facilities and to reduce the contamination that we know is so important to avoid in glassmaking. We have made a £5.3 million investment in that over a couple of years, and those changes are happening on the ground. As my hon. Friend the Member for Rotherham said, reuse is not a short-term fix. It was once the norm when a lot of us-perhaps not all hon. Members present in the Chamber-were growing up, and it can be again. In some ways the future looks like the past-let us hope that is not the case for the England game. PEPR creates a powerful financial incentive for glass producers to move to reuse. Running reuse schemes means producers avoid most PEPR fee obligations, and glass, as we have heard, is a durable, tried and tested technology. While it requires up-front...
House adjourned.