Four simple ways to improve the PRN system

Written by: Robbie Staniforth | Published:
Robbie Staniforth

Hidden towards the end of Defra’s recent consultation on the reforming of the UK packaging producer system were some very interesting questions that relate equally to the current legislation and the future system, whatever it may be.

These questions relate to how government could better regulate the PRN market to deliver a fairer system and ensure that the money going into the system genuinely funds meaningful improvements in recycling.

The debate about how to better regulate the PRN market is one that has rumbled on for decades now. Since the introduction of the packaging producer responsibility regulations in 1997, there has been accusations of wrong-doing levelled at just about every party who works within the system.

There have been claims that the regulations have reached the objectives set. Namely, they’ve met the recycling targets at lowest cost to producers.

However, as is well documented, there have been unintended consequences, such as the systematic under-funding of UK reprocessing, which is now high on the public, and therefore political agenda.

It has been accepted by the majority in industry that the system governing packaging design and recycling requires wholesale change. However, that change is still some years off and urgent tweaks to the current system are required to ensure it doesn’t simply limp on until its extinction at the end of 2022.

Most of these modifications are very well understood and quite simple for the government to implement in the coming months, provided there is appetite for improvements and, probably more importantly, time found for the legislative process required.

Compliance fee

A compliance fee is something that has gathered a great deal of traction over the last few weeks. The introduction of such a measures could ensure that producer funds are ear-marked to be spent on meaningful projects that improve recycling capacity or deliver better quality material to reprocessors. It already exists in the WEEE regulations as a backstop for when the targets set cannot be reached.

In recent years the fund has increased significantly in size to a point where it is conceivable that an impactful citizen awareness campaign about WEEE is a genuine possibility, which is not something the waste world has experienced much of in recent years.

The problem of not having such a backstop for the packaging regulations is that if the country misses its target, a producer would simply face enforcement action by the regulators. The result could be prosecution or fine, which is unlikely to yield a significant benefit to improve the actual issue, specifically, that not enough reprocessing is occurring in the UK.

Mandatory reporting and issuing

Another option could be to mandate reprocessor and exporter behaviour in the system. While on the surface it may sound like a radical step to take, it could help to significantly reduce the ‘gaming of the system’. I imagine it would be welcomed by those reputable waste management companies that play a vital part in the system.

The imbalance in the system is that sellers (accredited reprocessors and exporters) do not have to sell PRNs or report the packaging waste they handle. Whereas buyers (schemes and producers) must acquire PRNs in order to meet their legal obligation.

Effectively it is a ‘must buy’ versus ‘don’t need to sell’ market. Defra has suggested in the consultations that all reprocessors and exporters may be forced to generate a PRN for every tonne of packaging waste handled. They could also be required to switch from quarterly to monthly reporting of the packaging waste handle. This would give the market more data on which to function, ensuring actions are taken on fact, rather than hearsay.

Revenue reporting

Better enforcement of PRN revenue reporting is another possible option to improve the system. Understanding how producer funds support and improve the system is certainly something Ecosurety has promoted in the recent past.

However, this is something that is very difficult to achieve with minor amendments and it will probably have to wait until the wholesale changes are made.

Obligation carry-forward

Finally, a recent suggestion is that the enforcement agencies could allow producers and schemes to carry some of their obligation into the following year to reduce the likelihood of year-end profiteering when material targets are tight. While this could help to alleviate the price spike and is a relatively easy change to make, it may be difficult to manage and could simply be kicking the under-capacity can further down the road.

Regardless of the long-term future of packaging producer responsibility, there are many improvements that can be made to the current system to limit the market volatility that hampers longer-term strategic partnerships.

We shouldn’t simply give up on the current system or else the sector will simply be treading water for the next three years in the hope that a silver bullet magically appears in 2023.

Robbie Staniforth is head of policy at Ecosurety

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