British food firms successfully lobbied to defer £1.7bn plastic packaging tax

Exclusive: New scheme to improve recycling rates and tackle pollution was pushed back by Tories after industry complaints

Lobbyists for Britain’s biggest food brands successfully pushed for a £1.7billion packaging tax to be deferred, Democracy for Sale can reveal.

The fees for a new scheme to improve recycling rates and tackle plastic pollution were due to be imposed this month, but were delayed for a year by the last Tory government after the industry complained about the costs in a series of private meetings.

The extended producer responsibility (EPR) scheme aims to shift the costs of collecting and recycling waste on to the companies that make packaging for soft drinks, confectionery and other consumer goods. They would pay fees based on the amount of packaging they use, with lower fees for more sustainable options.

But the charges of up to £605 a tonne of packaging were delayed after lobbying by three trade bodies that represent hundreds of food and drink companies, according to internal government records obtained by Democracy for Sale.

Rudy Schulkind, a political campaigner at Greenpeace UK, said Tory policy on the scheme had been defined by “dither and delay” and Labour now needed to implement a robust scheme.

“They need to show their mettle and stare down the lobbyists,” he said. “Otherwise, they risk repeating the failure of the last government. The cost of this scheme to industry is nothing compared with the cost of the plastic pollution crisis to our planet.”

On 15 March last year, officials at the Department for Environment, Food and Rural Affairs (Defra) attended a stakeholder meeting with the Food and Drink Federation (FDF), the British Retail Consortium and the Industry Council for Packaging and the Environment.

The group agreed to meet once a month and to exclude other organisations from the talks, such as environmental bodies.

A summary of the meeting obtained under freedom of information laws reveals that the “role and remit” of the forum was to “ensure industry has early sight of plans and proposals and prepare engagement with ministers”. When a civil servant “asked whether the membership should be expanded”, it was agreed to “keep the current membership in the interests of more candid conversations”.

The lobbyists complained to Defra about “inflationary pressures, consumer value for money concerns and the high costs for industry”.

Documents show that that one unnamed lobbyist “suggested that a pause was needed to reflect on the industry concerns and review how to move forward”.

Another business representative warned of “serious concerns about the timeline and industry trust” and asked for “a phased approach to cost recovery so that full costs would not be imposed in year one”.

A Defra civil servant responded that “ministers were not minded to delay”, but the government announced in July 2023 the scheme would be delayed.

The industry groups also met the then environment secretary Thérèse Coffey in March 2023, with a follow-up letter from the organisations claiming Coffey agreed that “some flexibility could be found for amendments in the current draft [of the legislation]”.

The heads of the three trade bodies acknowledged in the letter that “a staggering amount of plastics are failing to be reused – and are being exported, incinerated or ending up in landfill”. The industry wants more oversight of recycling to help ensure more effective use of materials and a bigger role in the governance of the EPR scheme.

The strategy was first proposed in 2018 by the Conservative government, which originally aimed to introduce it by 2023. But Dominic Hogg, an environmental consultant and EPR expert, said the scheme’s implementation had been “abysmally slow”.

Food companies and analysts have warned that the costs of the scheme will be passed on to consumers, with estimates of an extra 2p on a jar of mustard, 4p on a bottle of beer and 9p on a bottle of wine.

However, the government published new estimates for the base fees for the scheme last week that are lower than previous figures after lobbying from the industry over the costs.

The British Beer and Pub Association said the revised estimates were a “welcome step in the right direction”.

A Defra spokesperson said: “These reforms will create 21,000 jobs and stimulate more than £10bn investment in the recycling sector over the next decade. It means packaging producers, rather than the taxpayer, covering the costs of managing waste. We have always worked closely with a broad range of environmental groups, businesses and stakeholders to deliver this programme.”

An FDF spokesperson said: “Food and drink manufacturers take their sustainability commitments incredibly seriously. We have been working with government for years to attempt to roll out a transformational extended producer responsibility scheme that would truly deliver a circular economy in the UK and improve Britain’s flatlining recycling rates.

“As part of this, producers and the Food and Drink Federation have spoken to a number of stakeholders, including NGOs, to discuss what a best practice scheme would look like, which pushes up recycling rates and doesn’t risk pushing up food prices. Producers need to be at the heart of operating and driving a world leading recycling system.”

This story also appeared in the Observer.