Draft Packaging Waste (Data Reporting) (England) Regulations 2023

Ruth Jones Excerpts

Thursday 2nd February 2023 General Committees

[Ruth Jones (Newport West) (Lab)]

It is a real pleasure to see you in the Chair this morning, Mr Sharma.

I am sure that colleagues will be pleased to know that we will not be opposing the draft regulations; none the less, I have a number of important points to make. First, I thank colleagues in the sector, notably Ruth Chambers from the Greener Alliance, for sharing their thoughts and expertise.

This draft statutory instrument brings in reporting requirements for packaging waste in anticipation of the Government introducing a new system of extended producer responsibility. In other words, packaging producers will be expected to pay for the full waste management costs of the material that they place on the market. We support that aim, but as ever with this Government, the devil is in the detail.

It will come as no surprise to the Committee that the new system has been repeatedly delayed and is now not expected to begin its phased introduction until 2024—possibly at the earliest. It replaces a system relying on packaging recovery notes established back in 1997, which has long been widely regarded as not fit for purpose because producers typically pay for only 10% of packaging recycling and waste management costs, with the public—our constituents—covering the rest. Yes, it is important that a more robust system is introduced and introduced properly, but it is so important that we must take a moment—a small moment, Mr Sharma—to touch on the serious shortcomings in the proposed legislation.

This draft SI sets out that only producers that have an annual turnover of more than £2 million and put more than 50 tonnes of packaging on to the market will be subject to the full reporting and payment requirements. In addition, the SI brings in new requirements for smaller businesses, including producers with an annual turnover of more than £1 million that place more than 25 tonnes of packaging on to the market; they will be required to report data, but not obligated to pay EPR fees. Those that meet neither threshold will remain unobligated to collect or report data for the packaging they produce; nor will they be liable to pay for its management. How will that help to introduce a scheme that is fit for purpose and that can tackle the waste crisis?

The higher threshold resulting in full obligations is the same as in the current, flawed PRN system, which is a higher threshold than any producer responsibility scheme in Europe. The Government have not adequately justified the retention of the same full de minimis threshold, or their introduction of limited reporting requirements for those putting 25 tonnes of packaging on the market. Will the Minister explain that, in simple layman’s terms?

I note that the analysis suggests that about 1,800 more businesses will now face reporting obligations, but does the Minister have a precise number of the businesses affected? The Minister’s own impact assessment suggests that the number could be as high as 15,000, or as low as zero. What is the figure, and what will she do to ensure that the legislation means something?

[Margaret Greenwood]

My hon. Friend is making an excellent speech. Does she agree that there would have been room in the draft instrument for the Government to make stronger provision to ensure that effective action is taken immediately, in an effort to combat the waste crisis?

[Ruth Jones]

My hon. Friend is absolutely right. We do not want dither and delay; we want to get on with this. We support the aims, but we are not sure about the method. The right hon. Member for North West Cambridgeshire expressed the concerns that smaller businesses have about the new scheme; they need clarity.

To ensure that all material is covered by the new system, has the Minister considered eliminating the threshold entirely, as is common in many packaging systems in Europe, or lowering it to 1 tonne, as was recommended by the Select Committee on Environment, Food and Rural Affairs? The Government might with more justification lower the threshold to 10 tonnes, to correspond to the requirements of their own plastics packaging tax, which has just come into effect. This prompts a question about Ministers doing something with one hand and something very different with the other, which confuses people. Choosing to retain a full de minimis threshold that is more than five times as high, and a new limited de minimis threshold that is more than twice as high, as the threshold for another Government policy on packaging seems inconsistent, to say the least.

The shortcomings mean that the new system, like the previous one, will have to deal with uncertainty about the amount of material that is actually placed on the market, and therefore uncertainty about the real recycling rate for such materials, given that recycling rates are likely to be lower than reported if material placed on the market is not captured in the data. We should be ambitious as we seek to protect our planet and preserve our environment, but as ever with this Government, there is more dither and delay.

I gently remind the Minister that, back in 2018, the National Audit Office launched a report that criticised the packaging producer responsibility system for lacking “robust data”. Data is key, but this interim SI indicates a peculiar approach to legislation that is piecemeal rather than wholesale. Given the retention of the same threshold for reporting requirements in the proposals, it is likely that the new system will be similarly and unnecessarily flawed. Will the Minister comment on that?

In setting up this new system to hold producers responsible for the waste they create, the Government must be careful not to repeat the mistakes of the previous system. I have two final questions. First, will the Minister take all necessary steps to ensure that all packaging is properly accounted for? Secondly, can the Minister be clear that the new system will improve the quality of data compared with the one it is replacing? Without clarity or understanding of our actions, the draft SI will be what we have become used to: more of the same dither and delay.

[Rebecca Pow]

I thank the shadow Minister for indicating that the Opposition will support the draft regulations. She has raised some valid points, so I will summarise what we are trying to do.

The measure is intended to get packaging producers to report data on the amounts and types of packaging that they supply this year, 2023. That data will be used to calculate the producers’ recycling obligations for the EPR fees that the producers will be required to pay local authorities from 2023, to cover their costs of collecting the packaging. Previously, that was all subsidised by the local authorities doing the collecting and therefore the taxpayer. I think the hon. Lady will agree that that is the right direction of travel.

There is no dither or delay—one of the hon. Lady’s favourite statements—going on. We are in fact doing exactly what we said we would do. It was in our manifesto and we are introducing the new system. The fees will be decided from 2024—to be clear about that—so there is no dither or delay. The point of the draft SI is to get on with the system, which means that we need to start gathering the data in advance, so that the calculation can be made about which producer needs to pay what, depending on how much they put on the market. If the material is of poorer quality and requires a great deal more reprocessing to recycle it, they will pay more. If they have gone down the right road, and the material in their packaging is of good quality and already recycled or recyclable, they will pay less.

[Ruth Jones]

The Minister and I agree that data is vital. Will she assure the Committee that she will speaking to industry, as well as NGOs and other stakeholders, to ensure that the data is accurately provided, collected and utilised?

[Rebecca Pow]

Of course, because the whole thing hinges on good data. A new digital system is being created to handle it all, which is critical. A lot of the large companies are already used to collecting data, so the system is not completely new to them; they have been running it and they understand it. However, they will be required to collect more detailed data. I mentioned the kinds of things that they will now have to list. That data will help to inform the entire system.

The hon. Lady is concerned that not all packaging is going to be captured. In fact, all packaging will be subject to the obligation. For producers below the £2 million turnover and 50 tonnes threshold that has been set, the cost obligation will be met by their suppliers, so everything will be captured. That has been carefully thought through with a lot of the producers. It was one of the main points. She suggested a £1 million threshold, which is just a random number out of the air. We set it at £2 million after a great deal of consultation.

The hon. Lady also asked how we will know whether the system is working, and what we will do if we need to change it. Of course, it will be reviewed as it gets up and running and the data starts to come in. There is plenty of scope to do that. She also questioned the number of suppliers. About 7,000 large producers will be involved in capturing and recording the data, which is what we require this year.