OPINION: I represented The Recycling Association in the sprint group held by Defra that led to the publication of a new consultation on PRN reform.
Overall, the conversations among stakeholders were good, there was some disagreement of course, but also consensus that the PRN system needed some reform to make it work better to support UK recycling infrastructure and reduce fraud.
Yet I am disappointed in the consultation that came out, and I don’t think it will help the PRN system overall as it just creates more hassle for the recycling industry.
With The Recycling Association representing companies across all materials involved in the PRN system, both domestically and export, I can recognise that the interests of some sectors are different to others. One of the key points I made was that any reform should not be one-size fits all, but there is little reflection of that in the consultation.
Let’s start with some positives, the reviews of national protocols and Agency Agreed Industry Grades on a regular basis has to be a good thing. Take mixed paper for example, where the national protocol says that the agreed percentage of packaging is 34.5%. In reality, due to a decline in newspaper and magazine readership plus an increase in online deliveries in cardboard packaging, it is more likely that the packaging percentage in mixed paper is above 60%. Regular reviews will adapt to changing consumption patterns.
It isn’t in this consultation but might be in one next year, but we also support the idea of minimum sort standards for both domestic and export PRN issue. To create a genuine circular economy, we need to commodify the products we create, and minimum sort standards will raise quality. Of course, this should only apply to materials where these quality considerations are important for closed-loop recycling. Making these domestic and export also ensures there is a level playing field and ensures a fair and free market for these commodities, ensuring there is competition and the efficiencies that leads to.
In terms of the negatives, there are quite a few.
Firstly, the consultation raises old tropes about export and there was consensus among many in the group that a first draft was too negative about export. It is disappointing that much of these statements ended up in the final consultation.
I go back to my one size does not fit all point, some materials such as paper and cardboard, aluminium and some plastics grades will continue to rely on export markets. Others such as wood, glass and HDPE plastics have tended to be more domestic in nature.
But it isn’t export markets that are leading to cheap imports of virgin plastics, or high energy prices crippling UK recyclers.
Of course, we should support UK recycling infrastructure where economically feasible, and that might involve financial support in the forms of subsidies such as the PRN. But we also need to recognise that we are part of a global economy, and it might be more sustainable to return items back to where they were manufactured in the first place.
I also think there is a certain irony in raising UK exporters polluting foreign nations when parts of our country are covered in illegal waste dumps that we seem unable to do anything about. I go back to my point about minimum sort standards. If we are creating products for a circular economy, whether domestic or export, we reduce pollution in the
UK and abroad by ensuring these meet a specification, are low in contamination and as much of the material can be recycled as possible. Indeed, legitimate companies whether domestic or export recognise and want to ensure they are dealing with the highest quality materials.
Many of our Members have been through hell since last summer as they have got to grips with what they need to do to meet the 2024 Packaging Regulations. A dodgy registration and accreditation process was a nightmare for them, the PRN system was effectively closed in January and for much of February and now they are dealing with Summary Logs that are a bureaucratic nightmare.
Yet Defra has slipped in passages in the consultation about tightening the evidence reprocessors and exporters will be required to provide from 1 January 2027 above what is in their 2026 Sampling & Inspection Plans. This was not discussed in the sprint group, and there is no detail about it. I predict this is going to be a mess and a bureaucratic nightmare too. Increasing workload on legitimate companies will not prevent PRN fraud or criminal activity. We’ve got to stop treating these businesses like criminals and instead focus on those who are actually up to no good.
During my time at The Recycling Association, we have been calling for measures to combat fraud in the PRN system and use the PRN system to better support recycling both domestically and in the export market. We’ve long called for an expert panel to assess data and look at patterns to identify fraudulent behaviour. Therefore, the Fraud Detection Initiative is welcome.
To give them some credit also, the Environment Agency in particular out of the regulators, has responded and more investigations into PRN fraud are occurring, arrests have been made and there have also been some prosecutions.
Morally, I think there should be cancellation of PRNs that have been obtained through fraudulent activity. However, the difficulty is doing this when you have deadlines determined for each compliance year, and the fact that investigations into fraudulent activity can go way beyond a compliance year. Indeed, there is also the risk that if you cancel PRNs within a compliance year, you automatically distort the market by taking out ones that have already been paid for at potentially a significant price difference to the current market.
There is no easy answer to this, but Defra’s proposal to introduce either a Compliance Fee Mechanism or an extended compliance year did not have consensus. Certainly, The Recycling Association and some other trade associations were unconvinced by the arguments and concerned that it would distort markets, or worse become the default.
The cancellation of PRNs needs more thought and investigation of other options, and that takes time. It shouldn’t have been forced onto this consultation by Defra.
I welcome that Defra engaged with The Recycling Association and the other stakeholders listed in the consultation document, and without that, the consultation could have been much worse.
I feel an opportunity was missed here for reform of the system to make it work better for participants and to continue funding of recycling. Instead, there will be more tinkering, more hassle, and probably no real benefit apart from in one or two small areas.
