Producer Responsibility Obligations (Packaging and Packaging Waste) (Amendment) Regulations 2025

Considered in Grand Committee

Moved by

That the Grand Committee do consider the Producer Responsibility Obligations (Packaging and Packaging Waste) (Amendment) Regulations 2025.

My Lords, these draft regulations were laid before this House on 3 November. They amend extended producer responsibility for packaging, or PEPR, across England, Wales, Northern Ireland and Scotland. They represent a major step towards a circular, resource-resilient economy—one where producers take greater responsibility for packaging, and waste is designed out from the start.

Extending producer responsibility for packaging is the cornerstone of the Government’s once-in-a-generation recycling reforms. These reforms will increase the quality of the recycling that local authorities collect, support sustainable growth in the UK waste management and reprocessing sector, and reduce our reliance on material imported from overseas. As a result of the reforms, the waste management sector has committed to creating 25,000 new jobs and investing more than £10 billion in the economy. UK circular industries—those keeping products and materials in circulation for as long as possible—now deliver £67 billion yearly to the economy, and growth in this sector is more than double the rate of the overall UK economy.

The original PEPR regulations, introduced in 2024, created a framework for managing household packaging waste. They shifted the financial burden of disposal from taxpayers and local authorities to businesses supplying packaging. Producers must now cover the costs of managing their packaging waste and ensure that a proportion is recycled, with evidence provided to the regulator.

I now turn to the new obligations. These amendments aim to improve fairness, clarity and operational efficiency, responding to feedback from producers, local authorities and stakeholders, while aligning with international best practice. I will highlight three key reforms. The first is the appointment of a producer responsibility organisation, or PRO. We are enabling the appointment of a producer responsibility organisation from 2026—a very significant development. The PRO will be an independent not-for-profit body, established with the support of producers, to take on core responsibilities for the operation of the PEPR scheme. This responds to industry requests and mirrors successful models in countries with mature extended producer responsibility systems. The PRO will operate under conditions agreed by the four Governments and work closely with PackUK, the scheme administrator. Sovereign functions, such as data ownership and fee-setting, will remain with PackUK.

Secondly, I speak to the expansion of offsetting provisions. Large producers operating closed-loop recycling systems for food-grade plastics—where they collect and reprocess their own food-grade plastic waste—can now deduct these tonnages from disposal cost obligations. Eligible producers may resubmit 2024 data and receive revised invoices for 2025. We are doing this because we want to increase the recycled content in food-grade plastics. Despite sorting techniques, it is currently difficult for local authorities to keep plastic that is intended for food contact separate from other types of plastic. The result is that food-grade plastics often get downcycled, so we lose this valuable material. Closed-loop systems preserve valuable material and reduce reliance on virgin plastics, supporting the UK’s move towards a circular economy.

These amendments do not alter the core policy of PEPR. Instead, they enhance delivery, ensuring fairness, transparency and effectiveness. They were developed through extensive consultation and co-design sessions with producers, local authorities and others across the packaging value chain.

In conclusion, the changes in this amending SI strengthen our commitment to a circular economy. They support innovation, reward sustainability and ensure that the packaging system works for the environment, industry and the public. I commend them to the Grand Committee and I beg to move.

My Lords, I thank the Minister for his introduction to these regulations and also declare that I am a vice-president of the LGA and a past leader of a local authority. I welcome and note this statutory instrument creating an obligation on businesses that supply household packaging and managing the packaging once it has been discarded, to enhance to environmental protection, and for producers to demonstrate how they can work with the general public so that more products can be recycled and, importantly, to make packaging environmentally sustainable and, we hope, more easily recyclable—with, inevitably, lower fees charged.

Importantly, the instrument also mandates producers to make more sustainable decisions at the product design stage. That means more costs for businesses to take in, so, on the counter side, what support will His Majesty’s Government undertake to incentivise employers, helping them to increase their recycling target rates to deliver more carbon savings? Will this amendment refer to small, medium and large businesses on a sliding scale, or for any exemptions? I make a request in particular for extra support for our small businesses, as they are a lifeline in our supply chains to our economy.

Another point to make is: what assessment is being designed of how the household definition could be refined to capture fewer items of packaging disposed of by businesses? How are producers to offset fees for packaging that they produce when they collect and recycle packaging themselves? In particular, the amendments allow producers to offset fees for closed-loop packaging, easier on top of the existing exemptions. How will this be truly monitored? What acceptable range of evidence must producers provide for closed-loop packaging waste, which has been recycled before fees for packaging can be offset? I look forward to the Minister’s reply.

My Lords, it is a pleasure to follow the noble Baroness, Lady Redfern, and to thank the Minister for his introduction. I broadly welcome this statutory instrument, which is at least a baby step towards polluter pays—that those who profit from the production of packaging that causes such damage in our communities should at least deal with the costs of dealing with the waste, which is of course only one small part of the total environmental and public health costs of the packaging overall.

I will start with a couple of specific questions, following on from the noble Baroness, Lady Redfern, and then ask a broader, bigger question. As the noble Baroness said, a lot of the concern around this SI has been about the trade-off between closed-loop recycling systems, turning things back into food-grade recyclate, and how that will be monitored and audited. I note that a joint submission from the Wildlife and Countryside Link, the Environmental Investigation Agency and Everyday Plastic expressed concern about this and said that there was an absence of stringent and auditable evidence requirements, which could be a serious loophole.

We have to look at this in the context of how much sheer corruption and fraud we have in the waste sector. I can see one noble Lord frowning at me in puzzlement, but of course there is the 10,000-tonne waste mountain beside the River Cherwell in Kidlington in Oxfordshire and the 25,000-tonne one in Bickershaw in Wigan, which are believed to be illegally dumped waste. There are widely thought to be huge problems of lack of control and oversight.

In that context, I note the concerns expressed by our Secondary Legislation Scrutiny Committee about the resources available to the Environment Agency in England. It also refers to the other agencies, but I will refer just to England as that is within our purview. I note that the committee suggests that we press the Minister on whether Defra is confident that the regulators will have sufficient information—and, I would add, whether they will have the resources to process and deal with that information. We all know how incredibly stretched the Environment Agency is. Is it actually being given more resources to deal with this SI? That is my very specific question.

My Lords, I thank the Minister for setting out these regulations and the noble Baronesses, Lady Redfern and Lady Bennett, for their important and interesting contributions. These regulations mark the next step towards the vital circular economy that many of us have advocated for over many years, rightly shifting the cost burden for packaging waste away from council tax payers and local authorities and towards those who place that packaging on the market in the first place. That direction of travel is welcome, but there are serious concerns about how the transition will work in practice, especially given the speed of the introduction, and especially for small producers and the already stretched hospitality sector.

The aims of extended producer responsibility—to reduce waste, increase recyclability and make the “polluter pays” principle real—are ones that the Liberal Democrats strongly support. The moves to refine the 2024 framework and establish a clearer role for a producer responsibility organisation can, in principle, help to deliver a more coherent and efficient system. However, from the outset, there have been calls from across the industry for a more phased, proportionate transition that recognises the very different capacities of large brands and small producers to absorb new costs and navigate complex reporting requirements. For smaller producers, this is not a marginal administrative adjustment; it is a potentially significant new cost arriving on top of energy bills, wage pressures and squeezed demand. Many smaller producers do not have in-house compliance teams, but my understanding—unless the Minister can correct me—is that they will be expected to collect detailed packaging data, interpret nuanced recyclability rules and manage new fee structures that still remain, in part, uncertain.

The concern is that, if this instrument’s timetable is implemented in its current form, some smaller producers and niche food and drink producers may find themselves priced out, not because they are unwilling to play their part but because they lack the capacity to manage the complexity and volatility of the new regime. For instance, this scheme has been described, in the voice of hospitality, as

My Lords, I too thank the Minister for introducing these amended regulations. I begin by acknowledging that they make a number of sensible technical adjustments to the extended producer responsibility scheme. They show some movements in response to concerns raised by industry, and they are broadly welcomed on that basis. However, the underlying concerns repeatedly voiced by stakeholders have not yet been fully addressed. This is particularly acute in two areas: the treatment of glass within the cost recovery model; and, as also highlighted by the noble Baroness, Lady Grender, the emerging problem of double-charging in food, drink and hospitality businesses.

The Government have said that they are aware of the problems with glass, particularly the use of weight-based metrics, have acknowledged the double-charging issue for pubs. But recognition is not the same as action and, despite that recognition, we are still without solutions.

When this SI was debated in the Commons on 9 December, my honourable friend Dr Neil Hudson highlighted the discussions at the recent food and farming emergency summit convened by the leader of the Opposition and the shadow Environment Secretary. The summit brought together farmers, fishermen, food producers and hospitality businesses. One of the clearest themes to emerge was the impact of the current EPR design, with many businesses reporting that they are effectively being charged twice.

Following the summit, my right honourable friend Victoria Atkins wrote to the Government with a list of practical, immediate measures proposed by the sector to help them to survive the next 12 months. Among them was a request for a rapid review of the EPR scheme’s impacts on food, drink and hospitality, including the specific problem of pubs that are facing the double-charging issue. In the debate on 9 December, the Defra Minister responded:

“We recognise the strength of feeling on the need for a system that can be effectively monitored and enforced … we are looking at what we can do to refine the system further to deal with the issues of double charging … We recognise the issues with glass … and the issues with measuring by weight”.—[Official Report, Commons, Fourth Delegated Legislation Committee, 9/12/25; cols. 7-8.]

We appreciate the acknowledgement, but it is worth highlighting again that we have no concrete proposals or timetable.

We have also heard a joint statement issued by six major trade bodies: the British Beer & Pub Association, British Glass, the Scotch Whisky Association, WineGB, the Wine and Spirit Trade Association and UKHospitality. Their comments are as follows: