Packaging - extended producer responsibility: full business and regulatory impact assessment (BRIA)

12.0 Summary and recommendation

129. A system of producer responsibility for packaging has been in place since 1997 in the UK. This has helped to significantly increase the recycling of packaging waste and helped meet the UK’s and EU’s packaging waste recycling targets. However, due to several shortcomings a reformed producer responsibility system for packaging is required.

130. Extended producer responsibility (EPR) is a well-established principle adopted by many countries around the world, across a broad range of products and materials. It places responsibility on producers for the cost of managing their products once they reach end of life and gives producers an incentive to design their products to make it easier for them to be re-used or dismantled and recycled at end of their life.

131. The UK government and the devolved governments are exploring ways in which to design and introduce an extended producer responsibility system for packaging and are evaluating the options below.

Option 1. Packaging EPR: Reform the packaging producer responsibility system such that producers pay packaging EPR fees for the collection and end-of-life treatment of packaging waste from households (Kerbside and Household Waste Recycling Centres). This is assumed to incentivise the correct behaviours by producers and consumers to deliver the policy objectives. This is our preferred option.

132. Taking Defra’s cost-benefit analysis results from their regulatory impact assessment and scaling to Scotland using a population share of the UK, the NPV of packaging EPR for Scotland is estimated to be -£17.02m over a ten-year period (2025-34). This negative NPV is partly due to the range of unmonetisable benefits of packaging EPR, such as the domestic reprocessing market that may benefit due to more material being recycled in Scotland; natural capital benefits from reduced reliance on virgin materials and a reduction in the amount of waste sent to landfill and incineration; benefits to consumers from communications on how to recycle and dispose of household packaging waste; environmental benefits from reduced greenhouse gas emissions; and system-wide benefits including increased transparency in the system.

133. Overall, the introduction of packaging EPR in Scotland is expected to overcome the shortcomings of the current system and help to address a range of negative social and environmental externalities through ensuring more producer responsibility for packaging waste. As a result, this BRIA recommends the introduction of packaging EPR in Scotland.