Contribution
I beg to move,
That this House has considered the impact of extended producer responsibility for packaging.
This is particularly relevant to pubs and breweries, but the EPR scheme extends wider than that sector. I thank Tata Steel, the Wine and Spirit Trade Association, British Glass and the Metal Packaging Manufacturers Association for their engagement.
As chair of the all-party parliamentary beer group, EPR for packaging is one of the key issues raised with me over the past year. The challenges presented by this policy were highlighted many times during the beer group’s inquiry earlier this year. The industry is affected by a wide range of policy requirements across almost all Government Departments. The cumulative impact of these policies and regulations is taking its toll—it is stunting growth, and growth is what our country needs. The Chancellor used the word nearly 50 times in yesterday’s Budget speech, so I know it is important to this Government. In securing this debate, I want to share some of the EPR issues that have been raised with us by the beer sector, and hopefully move them closer to resolution, to help businesses grow once more.
What is extended producer responsibility? It is a major new UK packaging obligation that applies to brand owners and importers of all packaging that could end up in household waste streams. Fees became payable on 1 April 2025. They are in the form of pounds-per-tonne rates for all the main packaging materials: cardboard, plastic, paper and glass. There are some exemptions for very small producers. These fees will raise £1.4 billion to pay local authorities for the collection, management, recycling and disposal of household packaging waste.
Nobody can disagree that the idea of EPR appears to be brilliant. First, the polluter pays, with the businesses that put the packaging on the market bearing the associated environmental and societal costs. Secondly, it is an incentive for companies to design products that are more durable, reusable and easier to recycle. Thirdly, it is meant to promote a circular economy in which packaging is kept in use for as long as possible, minimising waste going to landfill. That all sounds great, but unfortunately the reality for businesses, particularly independent pubs and breweries, is very different.
Laura James, from Gower brewery in my constituency, says that the introduction of EPR means the business has never had so much money going out the door. She fears that EPR requirements—on top of the increases to beer duty, the national minimum wage and national insurance contributions—could be the straw that breaks the proverbial camel’s back. Such independent breweries, which are the lifeblood of communities like mine in Gower, may be forced to close.
Laura talked me through the day-to-day impact of EPR on the business. Every six to eight weeks, it gets a delivery of empty glass bottles, and it uses around half a million every year. Since the EPR requirements came in this April, its supplier has added £5,000 to the delivery, which means the brewery now has to find around an extra £45,000 every year, just for the bottles.
The British Beer and Pub Association, which represents the industry, says that brewers and pubs are struggling, and that the EPR fees for glass packaging are far too high, costing brewers nationwide around £124 million a year. My first ask of the Government is that EPR fees for glass are reviewed. They currently work out at around 6p extra per bottle.
Gower brewery says that, in an ideal world, it would move away from glass to cans, but that requires investment, which is money it just does not have. Alternatively, it would create a bottle deposit scheme, but that also requires money. It would need to rent a warehouse to store the empties, buy numerous bottle-washing machines and pay additional staff to facilitate it all. Added to that, it could not guarantee the integrity of the second-hand bottles—that they would be 100% safe to drink from. That is why pubs and breweries say it is vital that glass fees are made fairer and more sustainable.