Councils to get £1.1bn for recycling from packaging fees charged to firms
Under the current system, local councils have footed the bill for disposing of items such as milk bottles, cereal boxes and soup tins using taxpayers' money.
But the new extended producer responsibility (EPR) scheme that comes into force this year will require businesses to pay towards the costs of recycling packaging they use.
Companies will start paying fees from November, with charges varying depending on how hard the material is to recycle.
It is hoped this will encourage businesses to reduce the amount of packaging they use, shift to more recyclable materials and invest in circular economy innovations, ultimately reducing the amount of waste sent to landfills or incinerators.
The Environment Department (Defra) said it expects to collect £1.4 billion from EPR fees over the next few months.
Regardless of the final collection, the department said £1.1 billion is guaranteed to go to councils in England for the 2025/26 financial year.
The further £300,000 is expected go to the UK's devolved authorities to allocate to councils.
Councils will be able to choose how to spend the funding, such as offering local residents more streamlined collections, building new infrastructures or upgrading facilities.
Environment Secretary Steve Reed said all councils must use the funding to deliver improved packaging waste collection services for their communities.
The scheme's administrator PackUK has been given powers to reduce future funding allocations if evidence shows a council has funnelled it towards other purposes.
More widely, the Government hopes the scheme will help to unlock regional growth, create new green jobs and boost household recycling rates which have seen little improvement over recent years.
It pointed to projects such as waste management firm Veolia's facility in Southwark which handles and processes materials collected from homes and sends them to be turned into new products.
Environment minister Mary Creagh said: 'This Government is cleaning up Britain and ending the throwaway society.
She added that the money 'will revolutionise how we deal with our waste and ensure more of today's rubbish is recycled into tomorrow's packaging'.
Local government minister Jim McMahon said: 'Clean and tidy streets are something everyone wants to see, and these commonsense reforms will help councils achieve that.
'Whether it's channelling more money into recycling or reforming the outdated funding system, we are fixing the foundations of local government so that it can focus on what matters most to people across the country.'
Jacob Hayler, executive director of the Environmental Services Association, said: 'Our members stand ready to invest billions, alongside local authority partners, in the next generation of recycling services, infrastructure and jobs, which will provide a rapid boost to England's stalled recycling rates.
'The new producer responsibility regime for packaging, alongside other measures to simplify recycling services, will unlock this investment and support our ambition to achieve a circular economy in the United Kingdom over the next decade.'
Jim Bligh, the Food and Drink Federation's director of corporate affairs and packaging, said: 'This announcement is welcome news for both industry and consumers, coming just before producers receive their first invoices for EPR.
'It marks a vital step towards delivering the improvements in the UK's recycling system that we all want and need.'
Adam Hug, environment spokesperson for the Local Government Association, said: 'It's positive to see the costs of managing packaging waste shift to the industry creating this waste.
'Councils are proud to run some of the best recycling services in the world, with high levels of public satisfaction despite significant financial pressures.
'This success is built on council's local knowledge and strong links with communities, and we hope the new scheme will support that work and help reduce the amount of packaging ending up in household bins.'
The EPR scheme comes as part of wider Government efforts to boost the circular economy, which also include the delayed deposit return scheme that provides a financial incentive to customers to return empty drinks containers to collection points.
Hashtags
Try Our AI Features
Explore what Daily8 AI can do for you:
Comments
No comments yet...
Related Articles
The Guardian
a day ago
- The Guardian
Ofwat CEO David Black to step down amid intense scrutiny of water sector
The chief executive of Ofwat is to step down at the end of the month, after the government announced the abolition of the under-fire water regulator for England and Wales. David Black is preparing to leave the role after four years, amid intense scrutiny of water companies and their regulators. Ofwat said the government will appoint a new interim chief executive before its abolition. The regulation of the English and Welsh water industry has become a key political issue in recent years, including during last year's general election, amid a wave of anger over sewage spilling into Britain's rivers and seas. Black's decision comes as the government and the environment secretary, Steve Reed, prepare for what they have billed as the biggest overhaul of water regulation since the industry was privatised in 1989. Ofwat has become a lightning rod for criticism of the sector, including over decades of underinvestment in infrastructure such as reservoirs and water treatment works while companies paid vast sums in dividends and other fees to their owners. Last year, the regulator gave a green light for water companies to raise average bills by 36% over the next five years in order to pay for upgrades. After the decision to abolish the regulator, Black felt he had to go, according to a person familiar with internal discussions at Ofwat. However, the board did not want Black to leave, and tried to persuade him to stay, the person said. One water company chief executive said they felt he was the wrong figure to take the fall. Black said: 'I have been privileged to be able to lead Ofwat over the last four years, during which time we have achieved a huge amount together as a team for customers and the environment. The 2024 price review backed an investment programme of £104bn, along with a further £50bn investment in major new water resources which will improve service, environmental outcomes and resilience in the years to come. I wish the team every success as they continue their important work.' Black was appointed interim chief executive in April 2021, and was permanently appointed a year later. He had risen through Ofwat's ranks after joining as director of economics in 2012. Iain Coucher, Ofwat's chair, thanked Black and said: 'David has worked tirelessly to bring about transformational change in the water sector. He has sought new regulatory powers and resources to hold companies to account, taken major enforcement action and provided funding and incentive packages that drive continual improvements for customers.' The decision to replace Ofwat, revealed by the Guardian, was made after a review published last month by Sir Jon Cunliffe, a former deputy governor of the Bank of England, found that the sector was 'broken', and recommended combining powers from four regulators, including Ofwat, into one. The interim boss of Ofwat will have to immediately tackle several urgent issues. The UK's biggest water company, Thames Water, has been locked in talks to try to agree leniency on fines from the regulator, which it has said will be necessary for its lenders to inject billions of pounds of new funding as part of an attempted takeover. The regulator has also faced criticism over pay for water companies deemed by some politicians as excessive, and over the effectiveness of an effort to ban bonuses for the worst polluters. Ofwat was this week directed to scrutinise £1.3m in previously undisclosed pay for Yorkshire Water boss Nicola Shaw, after the Guardian revealed the existence of the payments via Yorkshire's offshore parent company. The department for the environment, food and rural affairs was approached for comment.
Reuters
a day ago
- Reuters
CEO of UK's water regulator Ofwat to step down
LONDON, Aug 5 (Reuters) - Britain's Ofwat said on Tuesday its chief executive, David Black, would step down following a government decision last month to abolish the water regulator. In a statement, which came after Sky News first reported the story, Ofwat announced that Black has decided the "time is right to pursue new opportunities" and would step down at the end of August. An interim replacement is set to be appointed in due course, the regulator added. It comes after environment minister Steve Reed said last month he had agreed to abolish Ofwat as part of a regulatory overhaul. Britain will create a new powerful regulator for its water industry following public fury over sewage spills.
Reuters
a day ago
- Reuters
CEO of UK's water regulator to step down, Sky News reports
LONDON, Aug 5 (Reuters) - The chief executive of British water regulator Ofwat, David Black, is to step down, Sky News reported on Tuesday. It comes after environment minister Steve Reed said last month he had agreed to abolish Ofwat as part of a regulatory overhaul. Britain will create a new powerful regulator for its water industry following public fury over sewage spills.
