Councils could lose out from revised packaging tax fees, warns NLWA

NLWA is warning that Defra’s revised base fees for extending producer responsibility (EPR) for packaging are too low and will hit the finances of already pressurised local authorities. 
 
The illustrative base fees – the amount that manufacturers will be required to pay for the production of packaging materials – have been reduced across almost all materials and will apply UK-wide.  

Following the publication of the revised figures, North London Waste Authority Chair, Councillor Clyde Loakes, NLWA’s Chair made this statement: 

“It is disappointing to see that the cost per tonne for most materials has been lowered. This follows news that the introduction of mandatory packaging labelling to support recycling will be delayed. To those of us with front line experience in this area, such moves appear to contradict Defra’s earlier pledge to crack down on waste and move to a circular economy.  

“Extended producer responsibility fees should incentivise manufacturers to reduce packaging waste, and by not taking this forward as originally proposed, local councils will continue to pick up the tab for disposal. 

“As well as having worrying environmental consequences, the new base fees are likely to have significant economic consequences for cash strapped local authorities. Councils have been paying to dispose of unnecessary and difficult-to-recycle packaging for years, to keep vital services running despite underfunding. 

“Next month, local authorities will be given an estimate of extended producer responsibility payments they will receive to finance the collecting and disposing of packaging materials. Yet now, local authorities are confronted with the possibility that this cost will not be covered in full. 

“It is also hard to see how these revised base fees will cover the cost of the Emissions Trading Scheme – as proposed by the government’s recent consultation – and which local authorities will be required to fund from 2026.  

“This is particularly concerning at a time when local authorities across London are facing a £400 million funding shortfall, compounded in north London by the biggest increase in waste since Covid-19 – the collection and disposal of which represents an unavoidable cost for local authorities. 

“We sincerely hope this is not an indication of what is to come. The government must maintain their pledge to transition to a circular economy and ensure that the financial strain of waste management falls on the shoulders of producers, not local authorities and hard-pressed council taxpayers.”