20 May 2019

‘Don’t knock the house down over PRNs’

With an array of consultations in over packaging and related topics, Angus Macpherson, managing director of the Environment Exchange argues that the PRNs system has not yet run its course.


OPINION: The Government’s new-fired enthusiasm for the Environment – stimulated by David Attenborough’s assault on plastic waste – and the determination to leave no idea proposed within the European Circular Economy Package unvisited, even if previously discarded, is much to be admired.

Producing 491 pages of consultations and regulatory impact assessments swiftly after the Resources and Waste strategy is no mean achievement. Assessing the replies will be no simple exercise either! But there is a degree of concern, has the basic maxim: ‘keep it simple, stupid’ been overlooked? Is there a clear message, consistently applied and relayed? With so many potentially moving parts, it will be difficult to accurately assess the consequences.

Angus McPherson

Angus Macpherson is managing director of the Environment Exchange, an online marketplace for PRNs

The public have always been motivated to recycle but are confused by diverse collections not only in different ways but also different materials in different streets. Uncertainty remains on what is recyclable and what is not, a significant contributor to quality issues. ‘Check with your local council’ is not helpful. Attempts at harmonisation are welcomed. Without consistency, a clear communications programme is difficult; clear labelling helps. Including recycled content, maybe a simple number, would send a message with or without a tax.

Scotland

Scotland’s desire to run ahead of the pack, pre-judging the outcome of the DEFRA consultations, while admirable from one perspective will cause confusion not only to the public but also to the whole reverse logistics chain. It would be worse if England, Wales and Northern Ireland decided to set up different deposit schemes to the Scots.

Deposit schemes, as dual schemes, something to date that the UK has strived to avoid, are full ‘net’ costs schemes. While theoretically funded by the retailers, in practice much will be funded by the consuming public. What remains to be seen is the impact on litter, the quality of the recyclables collected and the income to alternative, mainly local authority, collection streams.

Without setting up further dual systems, which most perceive as a retrograde step, industry cannot guarantee full ‘net’ costs for collecting packaging. Industry already pays a substantial element, 40%, of those costs through the price it pays for secondary raw materials. The public perceive household waste and litter collection as very necessary public services. So it should be paid from the public purse using the additional funds raised through the plastic packaging tax and eco-modulation. Payments should be based on reaching pre-agreed standards of recyclables, mixed or otherwise. Potentially packaging litter collection could be funded through any surpluses derived from a deposit scheme.

Recycled content: ‘any imported packaging should be taxed as though it had no recycled content unless proved otherwise’

Recycled content

Eco-modulation and recycled content tax both aim to change behaviour. The change aspired differs between them, the tax aims to increase the demand for secondary raw materials whereas eco-modulation aims to penalise packaging that is not recycled. To focus minds the penalties should be substantial and linked to the value of the material. If a tax is to be introduced, any imported packaging should be taxed as though it had no recycled content unless proved otherwise.

If eco-modulation is introduced then PRNs would be needed for each form of composite, multi-material and potentially polymer type of packaging so that those industries could demonstrate their achievements. A compliance fee may be needed, if targets are not reached. Both should be graduated, over 3 or 5 years, in their introduction and be benchmarked against a target based on the packaging’s environmental impact to give reaction time for industry and collection systems.

Reform of the PRN system

And radical reform of the PRN system – a market-based system that has done all that has been requested of it to date?

  • Proposals to ensure a level playing field between exports and domestic reprocessing are welcomed.
  • Transparency can be addressed by: promoting the information already gathered by the NPWD, the database of information around packaging; requiring reprocessors and exporters to publicise not only what they intend to spend their income on in any one year but also what they have spent their money on in the previous year and encouraging all those that wish to know more about how their money is spent to register independently and negotiate bi-lateral agreements with individual reprocessors and exporters to meet their mutual desires.
  • There also needs to be an acceptance that PRN price changes reflect the market as it exists. If there is a shortage of supply, then prices will rise and vice versa.

So exciting times, many unknowns, but rumours that the PRN system has run its course are greatly over-exaggerated. No sensible person wishing to extend their house starts by knocking it down, the same applies in producer responsibility.

Related links
The Environment Exchange

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