Packaging Manufacturers: Extended Producer Responsibility

Debate between Ben Maguire and Sarah Champion

Wednesday 1st July 2026 Commons Chamber

[Sarah Champion]

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 social enterprises. The Minister will no doubt be familiar with Belu, which supplies water for parliamentary catering—indeed, Belu water bottles are in front of us on the Table right now. Belu donates 100% of its net profits to WaterAid, which supports clean water, sanitation and hygiene programmes around the world. However, while charities are rightly exempt from EPR fees, no such exemption exists for social enterprises, which are treated exactly the same as for-profit companies. The result for Belu is £1.1 million of EPR costs over the next two years—money that would otherwise be donated to WaterAid.

The EPR system adds complexity and uncertainty for businesses. Baseline fees were not finalised until very shortly before liability for EPR was due to begin. Fee modulation remains unclear, and the system allows for retrospective fee calculation, potentially creating exposure to unplanned costs late in the financial cycle.

[Ben Maguire (North Cornwall) (LD)]

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?

[Sarah Champion]

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 vast majority of EPR costs, often over 95%, to the end user. The upshot is that the EPR will not represent a boon to the public purse. On the contrary, this failed policy will cost the UK economy and that cost will be substantial.

I have raised these issues time and again, as have other Members. I have had meetings with Secretaries of State, Ministers and civil servants, and I have written, led debates and asked questions, all to no avail. This situation demands urgent action now, not a review in a year’s time. It requires not minor adjustments but immediate intervention to sort out this deeply flawed policy.

The glass industry has been clear in its ask: a targeted, time-limited reduction in the glass EPR fees of at least 75%. This is not about abandoning the policy or doing a U-turn; it is about fixing it. The Minister has the opportunity today to stabilise demand, prevent further switching away from glass, protect jobs and investment, and buy time to assess properly the real-world impacts of her policy. Crucially, it would allow the Government to realign the policy with their own original environmental and economic objectives. More broadly, the Government must make sure that the EPR protects UK jobs and investment, that incentives towards less sustainable products are removed, that fees reflect real-world costs, and that businesses have the clarity they need to plan and invest for the future.

Across the many sectors that have raised concerns about the EPR, support for its core principle has been universal. Businesses want to play their part in a circular economy, but the current system is not working; it is driving the wrong behaviours, undermining UK businesses, and putting jobs, investment and regional growth at risk. If we continue to get this wrong, the consequences will not be measured in tonnes or targets; they will be measured in job losses, lost industries and lost opportunities for the communities, like mine, that need them most.

I urge the Minister today at the Dispatch Box to put this scheme back on track.