PackUK identified a shortfall in the original Year 1 funding calculations, with industry fearing this would lead to notices being reissued.
This would have led to many producers being invoiced a second time round and incurring higher costs.
In an email sent by Defra to producers today, the department confirmed: “This is a one-time intervention to help mitigate increasing costs for producers and maintain stability during the first year of the scheme.”
The intervention means that there will be no change to the Notices of Liability (NoLs) issued by PackUK in October 2025.
However, those who resubmitted packaging data will see their approved tonnages reflected in updated NoLs which PackUK aims to issue by the end of March. These will not incur extra costs.
Going forward, such shortfalls will likely see invoices reissued to producers.
A Defra spokesperson said: “We recognise the pressures businesses are facing, which is why the UK government has stepped in with extra support in the first year of the pEPR scheme.
“This will ensure local authorities receive the funding they were promised to invest in improved recycling services. This one‑off intervention will help the scheme deliver the environmental benefits it was created for, including higher recycling rates and less waste.”
Why was there a shortfall?
PackUK said that the shortfall was due to “more accurate” packaging data being resubmitted by producers, resulting in a lower total packaging tonnage than previously submitted.
Speaking at an industry event two weeks ago, PackUK Chief Strategy Officer Esther Carter noted that the organisation has “a legal obligation to balance the books” and account for any shortfall or surplus funds.
It was predicted that the shortfall likely amounted to tens of millions of pounds.
PackUK added: “Year 1 is a period of adjustment for a scheme of this scale.
“We expect the scale of data corrections to reduce significantly in future years as familiarity with the scheme grows.”
It added that it is taking measures to improve data stability and prevent late adjustments.
Robbie Staniforth, Chief Policy and Impact Officer at Ecosurety, said: “We are pleased to see that the Government has taken the unprecedented step of covering this shortfall.
“Packaging producers have been trying to budget for these new costs for a number of years and were extremely concerned that they might increase further at the 11th hour.
“This intervention shows that the Government are supporting both UK businesses and local authorities to ensure these transitional issues are addressed.”
