Industry pushes for delay on EPR scheme

By James Bayley

Published: 24 October, 2024

With only a few months remaining before the Extended Producer Responsibility (EPR) scheme begins, UK businesses are calling on the government to delay its rollout, citing confusion, unpreparedness and unclear costs. In a joint letter to Defra, over 80 companies have urged postponing the scheme until there is more clarity on its operation and expenses.

EPR, scheduled to launch in January 2025, aims to make producers responsible for covering the costs of packaging waste management. While companies support the concept, they argue that without knowing the fees until mid-2025, they cannot accurately assess the financial impact on their operations and customers. Many businesses, especially small and medium-sized enterprises (SMEs) and importers, face challenges in setting pricing strategies and are less able to absorb unexpected costs.

The letter to ministers outlined several primary concerns. Businesses are asking the government to halt the scheme until fees are confirmed, a scheme administrator is appointed, and complete guidance from Defra is issued. The letter also calls for more time for businesses to adjust their pricing models accordingly.

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There are additional concerns that under the current proposals, producers could end up paying twice for waste packaging. Despite existing agreements for backhaul and direct contracts with waste collectors, along with the current PRN system, the EPR would introduce extra fees. While a ‘non-household’ exemption exists, it is seen as ineffective, leading to fears that most packaging used in hospitality could be unfairly charged. Although Defra is aware of these issues, it has yet to prioritise addressing them.

The Wine and Spirit Trade Association (WSTA) has raised concerns about broader issues, including unresolved questions over fee calculations, mandatory labelling and how the scheme will interact with the Deposit Return Scheme (DRS) in Wales. There is also uncertainty over whether glass will be included in the EPR or DRS, causing further confusion for the drinks industry.

Miles Beale, chief executive of the WSTA, said: “Defra sensibly delayed EPR by one year, but it is clear that the scheme is still not ready to roll out, and a further delay is needed to ensure the costs are realistic and transparent. Wine and spirit businesses are striving to use less packaging and make it more recyclable, but the current scheme is unfair and not fit for purpose. A delay would allow the industry and Defra to collaborate on a fairer, clearer, and more sustainable solution.”

For SMEs like Condor Wines, MD Lee Evans emphasised the need for cost transparency. “Our customers need 2025 pricing by mid-December, but we still don’t have accurate figures on EPR costs,” he said. Without clear information, businesses risk making inaccurate forecasts that could be damaging. Evans supports the WSTA’s efforts to delay the scheme, providing businesses with time to plan accordingly.

Simon Doyle, general manager of Concha y Toro, called for clearer guidelines. Describing the EPR as a major reform, he pointed out that producers are expected to manage a tax collection process without clear instructions. Doyle urged Defra to work closely with the industry to ensure a ‘sustainable and manageable’ implementation, rather than rushing a scheme that lacks clarity.

Concerns about the impact on glass packaging were also raised. Julian Momen, CEO of Enotria&Coe, warned that the proposed fees could disproportionately affect the sector, discouraging investment in the UK. He proposed a simpler, unit-based approach and called for alignment with the Deposit Return Scheme. Momen also stressed the unfair burden of potential double charges on businesses in the wholesale and hospitality sectors, advocating for a clearer exemption process to prevent this issue.

Kieran Healey-Ryder, head of corporate relations at Whyte and Mackay, cautioned against pushing through a scheme that is not fully prepared. Reflecting on the recent experience with the DRS, he warned that rushing the EPR could lead to similar problems. “A delay will give the scheme a better chance of success,” he said, urging the government to heed industry concerns.

As the planned start date approaches, the wine and spirits sector is appealing to ministers to take a practical approach. By postponing EPR until key issues are addressed, they argue, the scheme can be implemented more effectively and without adding unnecessary strain on businesses already facing economic pressures.

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