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

Baroness Grender Excerpts

Monday 15th December 2025 Grand Committee

[Baroness Grender (LD)]

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

“a well-intentioned environmental policy that’s become a margin killer for hospitality businesses”.

Indeed, the hospitality sector illustrates the risk starkly. Pubs, cafés, hotels and restaurants report feelings as if they are paying twice: once through higher prices, as suppliers pass on their producer obligations, then again through existing commercial waste contracts for exactly the same packaging. This flows from the way in which household packaging is defined, which can sweep in materials that never go near a household bin and are handled entirely as commercial waste.

As I think will be clear from all noble Lords’ speeches, we all desperately want these aims to succeed, but we hope that the Government recognise the concerns about implementation. May I ask the Minister some specific and, I hope, helpful questions? First, what changes, whether through the threshold, fee modulation or phased implementation, will the Government consider to ensure that small producers are not driven out, driven to worse packaging decisions, lowest common denominator options, or forced to consolidate solely because of the cost and complexity of compliance under these regulations?

Secondly, what steps will be taken, and on what timescale, to address the issue of paying twice issue—especially for the hospitality sector—so that operators are not charged both through their supply chains and through existing commercial waste arrangements for the same packaging?

Thirdly, will the Minister commit to publishing a clear, segment-by-segment impact assessment covering small producers and hospitality businesses specifically; and to reviewing the scheme after its first full year of operation, with a view to adjusting it where disproportionate burdens become evident?

Finally, on the evidence given to the Secondary Legislation Scrutiny Committee by the Wildlife and Countryside Link, the Environmental Investigation Agency and Everyday Plastic, as described by the noble Baroness, Lady Bennett, what consideration have the Government given to piloting—in the first instance, with some of the larger producers—to ensure confidence that the information streams and the system are robust, that the reporting is robust and that the loopholes are closed, before rolling this scheme out to the smaller producers I described earlier? I look forward to hearing the Minister’s responses to these questions.

[Lord Roborough (Con)]

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.