Small firms set to benefit from packaging regime changes?

Small firms could benefit from a change in packaging regulations, according to Defra.

Sarah Wooler, Defra packaging specialist , speaking to an open conference of the Advisory Committee on Packaging in London, told the audience the department, as part of its work to review producer responsibility measures, was looking to reduce the regulatory burden on smaller businesses and might exempt businesses below a £5million turnover. This would exempt one in nine producers – there are currently 6,906 businesses obligated with the de minimis turnover at £2million and 50 tonnes of packaging.

“It is a top priority to take more of the small scale businesses out of the packaging regime. Government is determined the UK is a place to grow their business.”

The conference, chaired by ACP chairman Bob Lisney, also heard minor changes will be made to the rules that govern the export PRN, known as a PERN.

The Environment Agency will be more closely aligning the permitted generation of PERNs to factors such as how material was paid for, to better allow for contamination or material which was not recycled, rather than working on current assumed recycling levels.

And, reflecting on the potential for wholesale changes to the PRN system, Ms Wooler, said that while only small amendments were likely in the short-term, “we have to ask whether the PRN system would work if we get much more ambitious targets from Europe. The PRN system might get uncomfortable in the future.”

The conference included representatives from a number of obligated businesses, compliance schemes and packaging experts and aimed to better explain the PRN system and to outline some amendments in the pipeline.

At the conference Mr Lisney referred to the PRN difficulties in 2013 when prices for glass evidence soared.

“The ACP was asked to review the situation and make recommendations. This we did and I am pleased government have acted on those and have made an announcement based on the recommendations regarding revised glass packaging tonnages and targets.”

But, while he was pleased with the input of the supply chain in the discussions on glass, Mr Lisney said it was found the PRN system was not commonly understood.

Mr Lisney said there have been calls for the PRN system to be changed.

“Despite these calls, I have not had any firm economic proposals sent to the ACP to consider. We have to remember that if we didn’t have the PRN system then we would have to have something else instead. Looking at other countries’ methods and costs of compliance we would have to have a very strong argument to even consider any fundamental changes.”

The chairman noted that ACP’s view is that targets on packaging materials to be met by 2017 will ensure the UK meets its Directive targets.

“That is not to say the system can’t be improved and if there are any reasonable amendments needed that can’t be handled within existing regulatory procedures. We will consider them and advise government accordingly. You will also be aware of the EU review of the waste directive which will undoubtedly consider packaging targets.”

Mr Lisney also warned much of the “low-hanging fruit” in terms of packaging waste for recycling had been captured. “The cost of compliance is likely to increase though because it will become more difficult to collect greater amounts of packaging.”

Defra producer responsibility lead, Sarah Steeds, commented the current system operates at “least cost to industry and consumers”.  She also confirmed government has a “much better understanding” of what caused the spike in glass PRN prices and that they should now reduce.

“Some of the issues come about because of a lack of understanding of the PRN sytem and quite a number of issues which have been raised with us.”

Among areas Defra has worked on, Ms Steeds highlighted:

– Lack of level playing field between PRN and PERNs: working with EA to improve guidance which will be issued at the end of April.

– MRFs: environmental permitting will drive up quality.

– Poor performance by regulators (on environmental crime): an extra £5million from the Budget, represents a 40% increase in expenditure by EA

– Insufficient recyclate from certain sectors: Solutions include work with WRAP and the soft drinks sector; work in the hospitality sector and Courtauld Three.

“These are all important actions that are aimed at improving how the system works,” Ms Steeds added. “We are looking further at a code of practice with the industry to “stabilise the PRN system”.

The audience also heard a note of encouragement from Environment Agency packaging official Chris Groves.

“We have recovered just short of seven million tonnes and to me, from an environmental organisation, it is hugely successful to pull out of the waste bin 67-68% of all that packaging waste we are putting on the market each year,” he said.

Mr Groves explained the PERN changes will be linked to ensuring there is an accurate reflection of the volume of material reprocessed overseas with additional checks. But the changes seem unlikely to satisfy the demand of some UK plastics recyclers who consider they are seriously disadvantaged by the export PERN believing it is more easy and cheaper to obtain, so putting them at a disadvantage.




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