Packaging Manufacturers: Extended Producer Responsibility

Will Forster Excerpts

Wednesday 1st July 2026 Commons Chamber

[Sarah Champion]

I hope to amplify the hon. Lady’s points later in my speech. Glass is not just another packaging material; it is infinitely recyclable.

[Mr Will Forster (Woking) (LD)]

I wanted to give the hon. Lady a chance to get back into the swing of things before intervening, but as she is talking about a valuable business in her constituency, let me say that the pub and brewery sector in Woking represents £100 million and 1,800 jobs to our local economy; those numbers used to be higher but, sadly our small brewery, Thurstons, had to close. The EPR was one of several factors that hit that brewery. Does she agree that we need a change from the Government on the EPR, as well as wider support for the sector?

[Sarah Champion]

I completely agree. Trying to level the playing field on this EPR measure is the one thing that I hope the Minister will give us comfort on today. Our hospitality industry is really suffering. More generally, I worry where the remaining places of community are in our towns, cities and villages. If we are not protecting the ones we have—the few we have—it is going to be a very dark future. Let me now get back to glass.

--- Later in debate ---

[Sarah Champion]

That is absolutely my concern. People do not talk about the impact on the supply chain. We already know that at least 350 jobs—more than 5% of the direct workforce—have been lost so far, but we do not know about the impact on the supply chains and associated businesses. These are not abstract numbers; these are well-paid, highly skilled manufacturing jobs, concentrated in industrial communities like mine, where, to be honest, such opportunities are at a real premium.

Since I first raised these issues nearly two years ago, I have been contacted by a range of businesses and industry groups, including: UK Hospitality, the British Beer and Pub Association, the UK Spirits Alliance, the Society of Independent Brewers and Associates, O-I Glass, the Scotch Whisky Association, the Wine and Spirit Trade Association, GMB, Unite, AB InBev, the all-party parliamentary beer group, the APPG on packaging in the circular economy, the Packaging Federation, Teva Pharmaceuticals, British Glass, and the Campaign for Real Ale. Their concerns are strikingly similar.

The EPR is not just affecting glass. Across the packaging sector, businesses are struggling in the face of this poorly designed, poorly implemented policy. Graphic Packaging International employs 57 people in my constituency, and upwards of 1,700 across the UK. It produces a range of fibre-based packaging for household goods, supplying major UK retailers with sustainable and innovative products, which are largely made from renewable or recyclable raw materials. However, like glass, they face unfairly high fees on the basis of being a heavier than their plastic equivalents.

That distortion is even greater for fibre-based composite packaging. Industry groups have identified what appear to be substantial errors in the methodology used for DEFRA’s EPR fee calculations for fibre-based packaging. By way of example, in the EPR fee cost breakdown, the cost of FBC collection is more than twice that of paper and board, yet it is collected for recycling with paper and board. How can the costs to local authorities be so radically different?

Similar anomalies are observed with other EPR cost categories, including sorting, residual collection and handling and disposal overheads. Costs for managing FBC should be similar to those for paper and board, yet are wildly disproportionate. Industry groups believe that that results from DEFRA seeming to have used data for another, wholly distinct type of FBC—beverage cartons—in its FBC fee calculation. Such elementary errors risk undermining the EPR’s core objectives. The Alliance for Fibre-Based Packaging has already reported evidence that long-standing shifts away from plastic towards more sustainable alternatives are slowing and, in some cases, reversing altogether.

[Mr Forster]

I thank the hon. Lady for being so generous with her time. I remember her making the same points in her Westminster Hall debate on the EPR back in May 2025. I made similar points in my Westminster Hall debate on beer tax—draught duty—in which we also talked about the EPR. Does the hon. Lady agree that it is really disappointing that a year on, the Government, and DEFRA in particular, have not listened to our concerns?

[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.

--- Later in debate ---

[Mary Creagh]

I am looking to my officials in the Box, and I think it is probably safest if I write to my hon. Friend on that issue.

Let me tell the House about the year 1 shortfall in fees. There was a shortfall in the fees this year as we allowed packaging producers to submit their tonnages and then their tonnages reduced because, obviously, they looked at their figures and reduced them. We listened to industry on that. Despite the regulations saying that actually industry should make up any shortfall, my Department took pressure off businesses by funding on an exceptional basis to hold fees down. We are taking steps this year to ensure that we do not have a repeat of that.

On early successes, we are hearing about PEPR bringing about change. Councils all over the UK are using this funding from the packaging industry to improve services to local people. In Tameside, the metropolitan council is investing £1.6 million in new vehicles and improved technology to deliver a more reliable service for taxpayers. Councils are investing to improve glass collection directly, which should benefit the industry in terms of the supply of high-quality cullet. For example, Aberdeenshire council is investing £5 million over 2 years to purchase a new three-compartment glass collection vehicle—I hope that is “vehicles”, but it says “vehicle” here—upgrading glass recycling points to reduce contamination, and improving the quality of glass recyclate, which we know really matters to the glass industry.

[Mr Forster]

I thank the Minister for being generous with her time. I am sure she can probably understand why I, Asahi, which is based in Woking, the hon. Member for Rotherham (Sarah Champion) and others are not satisfied with her answers today. I have heard nothing of the double taxation, which is what EPR is. Will she agree to meet me, the hon. Member, other MPs and, more importantly, the businesses impacted to fully understand the impact and to work out a way forward?

[Sarah Champion]

Perhaps the hon. Member was distracted when I mentioned the issue of me holding a roundtable with all these industries on this very issue, but I am happy to meet colleagues from across the House on these issues. I explained in the point that he perhaps missed that it is tricky because it has to be regulatable—we have to ensure that the regulator can verify what would happen. Of course, it is a complex micro-econometric model. As soon as fees are reduced in one area, they go up in another area. That is the bottom line on all this.

[Mr Forster]

I might have been distracted in the last eight minutes—I do not know why. I remember hearing that the Minister said she has held a roundtable. I do remember that it was last year, and I am keen for her to meet the stakeholders again before this wider consultation and what happens next—hence my request.

[Mary Creagh]

Obviously, I do not sit there and do the maths with people. These suggestions and potential solutions have to be modelled and worked through. We are working at pace to assess whether any targeted short-term measures could be introduced through the forthcoming PEPR amending statutory instrument to partially address the dual-use packaging issue. So we are working on a short-term solution, but we are also working on a longer-term solution, which is the Austrian model that I mentioned. Again, the hon. Gentleman may have been distracted by the whistle when I mentioned that.

Councils across the country are rebranding and upgrading their glass recycling points to make it easier for households to use glass recycling facilities and to reduce the contamination that we know is so important to avoid in glassmaking. We have made a £5.3 million investment in that over a couple of years, and those changes are happening on the ground.

As my hon. Friend the Member for Rotherham said, reuse is not a short-term fix. It was once the norm when a lot of us—perhaps not all hon. Members present in the Chamber—were growing up, and it can be again. In some ways the future looks like the past—let us hope that is not the case for the England game. PEPR creates a powerful financial incentive for glass producers to move to reuse. Running reuse schemes means producers avoid most PEPR fee obligations, and glass, as we have heard, is a durable, tried and tested technology.

While it requires up-front investment and system change, it shifts costs away from single-use production and disposal, it improves supply chain resilience and reduces costs over time. Reuse is already operating at scale internationally, particularly for glass. Reusing a glass bottle just five times can reduce the greenhouse gas emissions by more than a third. The more times they are reused, the greater the benefits will be.

As we have heard today, the issue is not just about the environment; it is also about jobs, communities and the long-term health of British industry. The industry estimates that these reforms will create 25,000 jobs and underpin £10 billion of investment in new sorting and processing facilities. The reforms will drive that improvement in our recycling rate and, crucially, they will reduce our carbon emissions.

In conclusion, glass matters, industry matters and glassworkers matter. This Government back businesses and workers, and we back the transition to a circular economy that makes the country stronger, cleaner and more resilient. Change is coming to EPR and I reassure all hon. Members that we want to have a predictable, well set out framework within which business can confidently operate and householders can confidently know that what they put in their recycling streams is going to have a second, and hopefully third and fourth, life.

Question put and agreed to.