EU packaging legislation encourages producers to be made financially responsible for its recycling. But the UK transposition leaves councils picking up the tab.
The PRN/PERN model of tradable credits has been prevented from having value determined by the market, largely due to three factors: council recycling targets; the landfill tax; and slow rises in producer recycling obligations.
Targets and taxation have kept the supply of recycled materials ahead of producers’ obligations, irrespective of PRN prices. But recycling targets for English councils are no more, and the landfill tax escalator is approaching its peak.
If councils respond by slowing their investment in recycling, might PRNs start to do their job?
Possibly not. The PRN system requires services to expand and contract in response to PRN prices - hard for councils bound into lengthy waste contracts.
Authorities need direct and stable payments to cover the extra costs of meeting the targets. For example, if producers want all councils to collect a specific range of plastics, they should directly fund its implementation.
It would not increase the costs of achieving recycling targets - just how those costs are shared. It would require producers (and consumers) to pay more, but offer savings to council tax payers.
Critically, it would be a step towards the ‘polluter pays’ principle, some 15 years after ‘producer responsibility’ was implemented.
Dominic Hogg, founder of Eunomia