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Packaging Waste (Data Reporting) (England) (Amendment) Regulations 2024

Volume 836: debated on Tuesday 5 March 2024

Considered in Grand Committee

Moved by

That the Grand Committee do consider the Packaging Waste (Data Reporting) (England) (Amendment) Regulations 2024.

My Lords, we have an afternoon of waste regulations today. These regulations were laid in draft before the House on 17 January. They amend the Packaging Waste (Data Reporting) (England) Regulations 2023. Since June last year, when those regulations were first amended, there has been significant change and development of the collection and packaging reforms. This includes a 12-month deferral to the full implementation of the packaging extended producer responsibility scheme, in order to focus on stakeholder engagement, and a delay to the Scottish deposit return scheme. These events have caused several issues that now require amendments to producers’ data reporting obligations.

I turn to the details of this instrument. These regulations introduce two key changes, but I assure the Committee from the outset that these changes are not a change of policy intent; instead, they address the delay to the Scottish deposit return scheme and stakeholder concerns. First, this SI removes the exemption from data reporting on drinks containers that would have been obligated in a Scottish deposit return scheme. The delay to that scheme, combined with the exemption from the data reporting regulations, meant that 180,000 tonnes of packaging would have gone unobligated for a number of years under both the deposit return scheme and the packaging extended producer responsibility. This amendment accounts for this development and ensures that all packaging supplied in the UK will attract a recycling obligation. The new provisions will exempt this material again once a deposit return scheme is operational.

Secondly, this instrument responds to stakeholder feedback on the definition of household packaging. These amendments address two key aspects of this feedback, broadening the definition to allow for more packaging to be exempt from disposal fees. The first update to the definition concerns packaging, or a packaged product, designed only for use by a business or a public institution: for example, a 50-litre beer keg. Under the current definition, if this beer keg is sold to a wholesaler before being supplied to the pub that uses it, this packaging would have to be reported as household packaging. However, large beer kegs are unlikely to end up in household bins. Our amendments introduce an additional test that offers producers the opportunity to exempt such packaging from being treated as household packaging.

The second update widens this “business only” exemption to include packaging or a packaged product that is supplied to public institutions, such as hospitals or schools, and is unlikely to end up being disposed of in a household bin, such as packaging for an ultrasound scanner or restricted medicines. These amendments allow for more packaging to be fairly exempted from being defined as household packaging and therefore not attract packaging extended producer responsibility disposal cost fees. However, all packaging, regardless of whether it is household packaging or not, will remain subject to packaging extended producer responsibility recycling obligations, as at present. This requires producers to purchase evidence from recycling facilities and those who export packaging for recycling; this is then used as proof that their recycling obligations have been met.

In addition to the two key areas that I have discussed, these regulations also make a number of other changes. There are four amendments that were identified not long after the original regulations came into force in early 2023. We were not able to include these in the amendments midway through the 2023 data collection year as they would have retrospectively increased obligations. We therefore always intended to make these changes starting from the 2024 reporting year.

This includes an amendment to clarify that the packer or filler is obligated for branded packaging if the only brand on that packaging relates to the packaging itself, not the product inside. For example, if a packer or filler puts their product in a branded “Jiffy bag” but does not add their own brand to it, the packer or filler is obligated, not Jiffy. I hope that is clear.

A further amendment to the regulations clarifies who is responsible for packaging where ownership is retained by an overseas producer while a UK-based third party imports or manufactures the product on their behalf. Once the ownership is passed to a UK-based client, that person, as the first UK-based owner, becomes obligated for that packaging. This could be a supermarket or wholesaler. This amendment ensures that packaging does not go unobligated.

The third amendment addresses a loophole to ensure that distributor producers retain their obligations where they sell empty packaging to large producers that then sell the packaging onwards without filling it, for example where a distributor makes coffee cups and sells them to a wholesaler, and then that wholesaler sells them on to a small coffee shop. In this scenario, the amendment will make the distributor the obligated producer for those coffee cups.

The regulations also amend the data reporting requirements on the nation in which packaging is sold. The regulations already require reporting by nation of packaging sold from a business to a consumer. This fix extends this requirement to ensure that data on the nation in which packaging is sold from one business to another is also collected. This was always the intention and will help enable recycling rates to be tracked individually in each nation. In addition, we are making an amendment that will aid distributor producers to comply with the regulations. It does this by requiring the Environment Agency to publish a list of all large producers that have reported data, supporting distributors to identify which of their customers are obligated producers in their own right.

Finally, the SI includes some minor amendments to correct drafting; some provisions to accommodate for the transition from the Producer Responsibility Obligations (Packaging Waste) Regulations 2007; and some changes to help avoid the reporting of one piece of packaging by two producers. These amending regulations will apply to England only, but similar amending regulations are being progressed in Wales, Scotland and Northern Ireland. My officials have worked closely with the relevant departments in the devolved Administrations in the development of this legislation.

In conclusion, I emphasise that the measures in these regulations are crucial for enabling the effective implementation of extended producer responsibility for packaging and realising its associated environmental benefits. I commend these draft regulations to the Committee.

My Lords, I thank my noble friend for tabling these regulations. I have two quick questions.

First, throughout the Explanatory Memorandum, a key theme is the link between the regulations before us and the extended producer responsibility regulations. When might we expect to see them? The two fit quite closely together. I do not know whether my noble friend can give us a date, but I understand that those regulations will contain guidance relating to the ones before us.

Secondly, I looked up the cost-benefit analysis and if I understand it correctly, the costs are about £1,200 million per year, presumably to producers of the packaging —I do not know whether that includes local authorities—and the benefits are zero. If so, is that beneficial going forward, on the basis of that cost-benefit impact assessment?

My Lords, I thank the Minister for his informative introduction to this long-awaited and much-heralded SI. He will be relieved to know that, unlike the previous SI, I am not outraged by this one.

These regulations come into effect on 1 April 2024. Large producers must collect the data from 1 January to 30 June this year but may not have to report it. However, all must collect and report the data from the commencement date of 1 April to 30 June, according to the Explanatory Memorandum. It is not clear what the large producers are expected to do. Can the Minister provide some clarification?

The Environment Agency will provide the necessary guidance for this SI. Why is it necessary for the EA to do so? Why is Defra not doing it? The EA is already under-resourced and under pressure, with a wealth of other duties. Surely Defra, which has increased its staff considerably in recent years, could have produced this guidance for what is, after all, a government policy objective.

These regulations relate to the extended producer responsibility scheme, as the Minister said, whereby producers will pay a tax for the amount of packaging they release on to the market. However, information about the cost will not be available until the producer responsibility, packaging and packaging waste regulations are produced. Smaller producers are particularly affected by not knowing the likely level of fees, and cash flow is a vital element of their businesses. I am sure the Minister is ready for the next question and will have a substantive answer. Exactly when will these regulations be published? Without them, the exercise we are going through today is somewhat meaningless.

I fully support these regulations, which should help considerably to eliminate plastic and other non-compostable waste from our environment. I have been contacted, as I am sure have others, by the Federation of Wholesale Distributors. It too is wholly supportive of the regulations but has a couple of reservations. usbIt feels that it is essential that the Government and the Environment Agency work with the sector on the types of products that will be classified as household waste. Can the Minister give a reassurance on this issue? The FWD is also keen to see continued collaboration between the Government and the wholesale sector to ensure that EPR remains a pragmatic and inclusive policy. I fully support the FWD in its aims and objectives. It is only by working together that a solution which suits all will be found and, therefore, be successful.

My Lords, I, too, thank the Minister for his clear introduction. Previous speakers have asked the questions I am particularly interested in, so I shall be brief. We support any measures aimed at promoting better use of our natural resources and increasing reuse and recycling. Establishing correct base data is fundamental to the success of the extended producer responsibility scheme for packaging, so we welcome this instrument.

We appreciate the reasons behind the instrument, which the Minister explained very clearly. However, I have a question about paragraph 10 of the Explanatory Memorandum, which deals with the consultation outcome. Paragraph 10.5 say that a third consultation on PEPR ran from July to October 2023. Paragraph 10.6 states that the response is being reviewed and that a summary is expected to be published in the spring of this year, which is only a few weeks away. Is it expected that anything in the outcome of that consultation might have been useful to have ahead of this legislation? It seems a bit odd that the Government did not finish the consultation before introducing this legislation. If there is something useful in it, are we likely to see a similar SI in the near future?

I thank the noble Baronesses for their questions. I am not sure that I grasped the nub of my noble friend Lady McIntosh’s question. I wonder whether I might chat to her afterwards about it, or I can write to her, or both.

The noble Baroness, Lady Bakewell, asked when producers are going to get clarity concerning fees for the extended producer responsibility packaging scheme. Producer fee rates will be set and published by the scheme administrator. Rates for the 2025-26 financial year will not be known until spring 2025, once all the producer packaging data has been received and checked. In the meantime, to support producers we aim to publish illustrative fees as soon as possible.

The noble Baroness, Lady Bakewell, also asked about stakeholder concerns about EPR. We continue to listen to feedback from all stakeholders throughout the development and delivery of this policy. The 12-month deferral of producer fees from 2024-25 has given producers an additional year to prepare for them, while also giving us the opportunity to consult producers on the deliverability of the draft regulations. Some of the amendments to this SI are in direct response to the feedback we have received from the consultation.

The noble Baroness, Lady Hayman, asked about the planned consultation. I think it would be best if I wrote to her on that. I am not aware of anything that is likely to come out of that which would require us to do another SI.

I hope I have covered most of the questions; if I have missed anything, I will write. I trust that noble Lords understand and accept the need for this instrument, which will make crucial changes to the Packaging Waste (Data Reporting) (England) Regulations 2023. These changes will ensure that drinks containers supplied in Scotland pick up an obligation in the same way that drinks containers supplied elsewhere do. The amendments will also widen the provisions that allow some primary and shipment packaging to become exempt from being defined as household packaging.

I thank noble Lords once again for their contributions and support today, and I commend these regulations to the Committee.

Motion agreed.