The Packaging Scheme Forum (PSF) has sent a letter to DEFRA in which it warns of a looming PRN supply crisis for plastic and aluminium.
The PSF is the industry body that represents packaging compliance schemes in the UK, who in turn represent 93% of all registered producers. The letter, addressed to Thérèse Coffey, Defra’s Parliamentary Under-Secretary, explains the increasing likelihood that the UK will fail to meet its 2019 recycling targets.
It explains how China’s ban on plastic recyclate at the start of 2018 forced the UK to seek alternative markets for plastic recyclate exports. While a short-term, partial solution has been provided by other countries in Asia, serious doubts over their viability have been cast as a market for the UK in the long-term due to queries over capacity and environmental accreditation.
Fewer plastic recyclers and exporters in operation
Whilst many UK reprocessors are doing their best to process additional tonnage, it will take some time for any additional investments in increased capacity to come on stream, further compounding the problem.
The PSF goes on to highlight that there are fewer plastic recyclers and exporters in operation this year than in 2018, emphasising this will impact the number of plastic PRNs available to UK producers obliged to purchase them under UK law. The 2019 Q1 packaging recycling figures released in May highlighted the under-performance of plastic and aluminium at the start of this year.
Currently, if producers or schemes fail to meet their legal plastic recycling obligations they are investigated by the Environment Agency, a lengthy and costly process. A worrying concern is that this process is untested for large-scale non-compliance across industry, should that situation occur.
Implementing a fall-back position
The PSF wholeheartedly recognise the efforts that Government has made to engage with the recycling and waste sector, but it is urging DEFRA to consider urgently implementing a fall-back position such as a ‘compliance fee’ into the current regulations for schemes and producers who face the prospect of being prosecuted as non-compliant at the end of the year.
A measure such as a compliance fee will not immediately solve UK recycling capacity issues, however it would ensure funds are ring-fenced and allocated to initiatives that actively improve UK recycling infrastructure and therefore ultimately increase the number of UK-generated PRNs.
A similar system has operated in the WEEE system for some time with positive results, raising millions of pounds to boost WEEE collections.
The current regulations cannot be neglected
Robbie Staniforth, chair of the PSF commented "The PSF welcome the Government’s recent efforts to engage on the future of EPR and recognise that much is being done to create a world-leading recycling system in the UK.
"However, the current regulations cannot be neglected in the meantime and while introducing a change mid-year goes against normal practice, the PSF are urging Government to recognise the extraordinary circumstances surrounding the PRN market for plastic and aluminium at the moment.
"Without significant tweaks being made to stabilise the current PRN system, we run the risk of large-scale producer non-compliance at the end of 2019. This would be a costly situation for DEFRA to deal with – both at a reputational and financial level.”
He also added: “The PSF have a further concern that in the absence of a compliance fee alternative producers that are struggling to obtain sufficient tonnage or justify the exponentially increasing costs may well decide that it would be better to miss their targets and fall back on the existing Enforcement Undertaking route.
"This involves non-compliant businesses agreeing to pay an agreed amount to environmental projects in lieu of complying with the regulations, but it would not have the benefits of a proper compliance fee process built in to the regulations.”
Willingness of industry to work with Government
The letter, which is signed by Robbie Staniforth on behalf of the 48 members of the PSF, outlines the willingness of the industry to work with Government on this issue, and suggests that time be made for a delegation of PSF and DEFRA members to meet.
It comes ahead of DEFRA’s summary of responses to the four consultations on resources and waste that closed on 12 May.
If you would like to speak to a member of our team about this news story, or the impacts of current PRN prices on your compliance, please contact us.
About the Packaging Scheme Forum
The Packaging Scheme Forum (PSF) provides a broad collective voice for packaging compliance schemes.
The PSF currently represent 93% of registered producers and 97% of producers registered with compliance schemes across a range of industry groups such as automotive, chemical manufacturing, engineering, food and drink manufacturing, apparel, sports and leisure, medical and retail sectors. Our industry and members are facing significant changes and the aim of the PSF is to provide feedback, guidance and advice to influence the decision-making process. The PSF has considerable expertise and experience of the Producer Responsibility Obligations (Packaging Waste) Regulations and collectively we are ideally placed to liaise with Defra and the enforcement agencies.
By working together, we can ensure the best result for the UK, our industry and our producers.
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