Extended Producer Responsibility: Change will always be inevitable

Margaret Bates, Executive Director of On-Pack Recycling Label, Martin Trigg-Knight, Director of Compliance Services at Clarity Environmental, and Roger Wright, Waste Strategy and Packaging Manager at Biffa, discuss the merits of changing before you have to.

PackagingNothing changes if nothing changes. And now, more than ever, real change requires a generation of leaders and businesses that think and act differently.
Change is hard. It's unsettling, time-consuming, and all too often, we give up at the first sign of a setback.

Extended Producer Responsibility (EPR) represents a viable way of making the recycling loop less open and more closed. Not a silver bullet. But then, who said it was?

"I think maybe it's a bit naive to think that we're going to be hit with a piece of regulation that everyone's going to get straight off," Margaret Bates, Executive Director of On-Pack Recycling Label, told Packaging Birmingham. "We'd be naïve to think there's going to be no tweaks and no amendments because I can't think when that's ever happened."

EPR is about progress, not perfection. It calls for a big-picture perspective on today's environmental and economic challenges and plotting a more hopeful course of action. After all, this hope will pull people along with it.

Rarely are there opportunities to make a real impact and help our planet, but waste represents environmental and economic harm that everyone can change and prosper.

Instead, Roger Wright, Waste Strategy & Packaging Manager at Biffa, suggests thinking of EPR like a compass, pointing to a more sustainable way, a much-needed foothold on our climb out of the waste crisis.

"Everybody's projected their meaning onto what they want EPR to do," said Wright. "But if we go back to the very conception of it, it was about moving the cost of collection and processing of waste from the local authorities to the retailer.

"That was the point of it. But we've all projected our wishes and hopes onto EPR. So, my personal view is that it should incentivise refill and reuse. But that wasn't the brief at the beginning.

"I remember bathing it in an Incpen meeting with Rory Stewart, the minister back then, talking about that EPR. And here we are 11 years later, and it still isn't here."

Tackling the waste crisis could be one of the most rewarding investments we ever make, and European and UK governments are responding to tackle the issue. However, it can only work if the whole system works – companies must react properly.

And we mustn't lose sight of the fact we're dealing with a huge agenda here, and as Martin Trigg-Knight, Director of Compliance Services at Clarity Environmental, and Chair of the Packaging Scheme Forum, suggests, there have been tweaks, and there will be more tweaks. But energy and efforts would be better directed now at optimising EPR's implementation, rather than opposition to its principles.

"We want the policy to land and then want to adjust it and make it better in the future," he said. "For producers, it's a huge challenge. For Defra, it's a huge challenge. It's a huge challenge for councils. A huge challenge for journalists to understand and document. So, it's an aspirational, fascinating policy instrument that, if done right, will put the UK at the forefront of European and global environmental legislation.

"If it's not implemented well, producers could incur heavy costs. I welcome the iteration of EPR that is coming into play. And I think If I look back towards the systems that were explored in the initial consultation, I feel that those were overly ambitious and sometimes hugely expensive.

"If we look at where we are now, even with the forecasts of where we are going, the previous versions of EPR, the four or five options put forward in the initial consultation, would have caused serious problems for the recycling industry and even more astronomical bills for producers. That's not to say I don't think getting it ready in time is a huge challenge. It's gradually taking shape, and producers are all gradually preparing themselves."

Back in 2018, then Defra Secretary Michael Gove shepherded a well-thought-through Resources and Waste Strategy to reform waste collection and recycling services in England.

We have learned that a smart, strong recycling policy like EPR can provide the resources needed to change recycling infrastructure and move us closer to a circular economy. It can provide a sustainable funding source for our recycling systems and make them more efficient. And it is good for a business's bottom line.

"There is a dawning realisation with many businesses," said Roger Wright. "Over three years ago, when I was at M&S, we were trying to map the cost of EPR across all of our products even then.
"I think the delays are an ongoing frustration. If anything, businesses would prefer it to happen, if it's going to happen, rather than the ongoing delays. But then the second thing is, I suppose the modulated fees aren't going to land for another two years. So that also gives them a little time to act."

Bates added: "It's one of those things that you're never going to reach an overwhelming full consensus on. It's about getting it going and evolving and optimising the thing. There's no point campaigning for delays because of the £1.7 billion this is estimated to cost. I haven't seen the government have that sitting somewhere in the background, ready to fill that hole in local authority funding if it doesn't go ahead. So, I can't see how anyone can afford to let this fall by the wayside."

The Resources and Waste Strategy has continually slipped off the radar ever since, and in the four years since, we have had four Defra secretaries. Factor in Covid, the fallout from Brexit, the war in Ukraine, the Liz Truss fiasco, the energy crunch and the cost-of-living crisis, and you'd be forgiven for not knowing exactly where we are.

It has since transpired that 2023 is about data. Next year will see an arbitrary amount of money paid, and the modulated phase will kick in the following year.

Bates continued: "I think there are many things businesses could start looking at now. There's going to be some degree of modulation based on recyclability. So, you could start to improve or check on the recyclability of your packaging. You could assess and label requirements – whether they're recycled or recyclable. Businesses can be doing all sorts of proactive things, particularly in the nature of data."

Once businesses gain a better awareness of the modulated phase, consensus suggests they will be more comfortable with the changes they're already starting to plan and make. But of course, I think there's still a lot of nervousness around what that might look like in the modulated phase part because we don't know.

Trigg-Knight pointed out that there are now multi-faceted benefits to first- and fast-moving organisations.

He said: "If you give people the time to prepare and get their packaging system operating in the way that they want it, then actually what you do is you enable those companies who want to become net EPR winners to utilise that policy tool to make themselves the most efficient, the best businesses possible.

"Big companies usually have such enthusiastic and ethical drivers in place. They welcome EPR, are environmentally focused and want to do the best thing.
"So they welcome the principles of EPR, and I'm sure they just want things thought through and to be as prepared as possible."

Many packaging manufacturers will have put a lot of thought into designing products that will meet EPR requirements, a particular challenge when different players in the packaging chain have different responsibilities. Any further fine-tuning must ensure EPR rewards people for doing the right thing instead of penalising them.

The current economic pressures are undoubtedly causing disruption, and unsurprisingly, eyes may have been diverted elsewhere. But we have come to understand how this plays out.

"I've been to see packaging manufacturers recently whom I would say are really up to speed, and they're specifically designing the packaging and bringing around innovations to guarantee that it will get a recycle label," Bates said. "The level of innovation and the pace of change from the packaging manufacturers, from what I've seen in many cases, is really impressive."

Emanating from the various sprint groups held alongside EPR's evolution is the need for a level playing field and simultaneous UK-wide de-risking. Many points to that as the reason Scottish DRS took a temporary back seat. And that's before you start looking at inconsistencies between a European approach and a UK approach.

Consensus suggests modulation still needs a lot of work. Modulation for packaging is about making EPR the effective policy tool we want to see. And details around its anticipated rollout in 2025 are vital if producers change their packaging to make it the most recyclable, the most efficient, the best for the environment, the best for the recycling industry, and potentially the cheapest for consumers.

"The more time packaging producers have to prepare, the better," said Trigg-Knight. "My understanding of lead times to make those changes in packaging is they take a year, two, or three years.

"We urgently require more detail to get the modulated phase in place and enable the desired effect. We don't want the fees to be seen as a penalty. What we want them to be is incentivising. And if we're going to do that, we need to tell producers how much exactly it's going to cost. Because when you change that piece of packaging, the complications of it are immense.

While the demand for modulation's timetable bottlenecks, the mood among those expected to facilitate this landmark policy is a pragmatic acceptance that it's not perfect.

"What we just don't know is how it breaks down into more granular detail," said Trigg-Knight.

"I'd need to be thinking about what change I need to make in packaging, and what do I need, particularly with the lead times, to make those changes? However, as much as can be ready is ready now; it is now time to think about the next phase of legislation."

This status quo has quickly become unworkable. Manufacturers don't have to make their products and packaging easy to recycle or include recycled content. Retailers can sell anything they want. Consumers have no legal obligation to recycle it. And without legal requirements, some waste management companies rarely recycle it either.

If we take the original aim of EPR, moving the cost from local authorities to retailers, it will meet its obligation. But already, we've moved on. Maybe now it has become about encouraging better decision-making around packaging and, in theory, moving more businesses to circular business models.

We shouldn't lose sight of the reason we're doing this!

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