Question to the Department for Environment, Food and Rural Affairs:

To ask the Secretary of State for Environment, Food and Rural Affairs, if he will make an assessment of the potential implications for his policies of the classification by the Office for Budget Responsibility of the extended producer responsibility scheme as a tax on production.

Whilst pEPR was announced a few years ago, Defra has now built a modelling framework to calculate local authority costs and producer fees that was used for the first time by the OBR to include pEPR in their forecast. Pending a decision by the ONS, the OBR have recorded pEPR disposal fees as a tax in their forecast on the advice of Treasury classification experts, whose indicative views is that the ONS will likely classify the income stream as a tax when they formally classify the scheme.

This technical classification does not affect the distribution of revenue to local authorities. Revenue from pEPR will be distributed directly by PackUK, the scheme administrator, to local authorities. It will not be diverted to the Treasury or central government finances.