Industry stands firm as countdown to Budget begins

As the industry waits in anticipation of the announcements expected from the Chancellor relating to addressing tackling plastics waste, Philip Law writes exclusively for BP&R on what the BPF has suggested is the right way forward for the good of the environment, the country and the industry.

We understand that the Budget is likely to be announced on October 29th. I would like to share with you the main points of the BPF’s Budget Submission, which has already been submitted to the Chancellor of the Exchequer on behalf of our £25.5bn industry.

Firstly, on a potential Virgin Polymer Tax, we have said that we do not believe that taxation on virgin polymer will resolve the environment issue. On the contrary, a tax on virgin polymer is likely to lead to responsible businesses being further dissuaded from future UK investment.

It is likely to increase costs for plastic manufacturers, brands and retailers — and this risks filtering through to price rises for consumers.

In addition, raising the price of the most resource-efficient, lightweight and recyclable material may encourage brands and retailers to adopt other materials, which will increase CO2 emissions and may have other unintended consequences such as an increase in waste. We cited Trucost, a leading environmental consultancy, who in 2016 estimated that the environmental cost to replacing plastic with alternatives materials would be nearly four times greater.

We said that a plastics tax on UK businesses in these challenging times will divert funds away from R&D and training, further damage global competitiveness and stifle the innovation that has driven improvements in recycling and reduced the weight of plastic products. It will also discourage inward investment and potentially result in job losses at a time when we want to support industries following Brexit.

Indeed, a plastics tax does not provide any guarantee that the money raised will end up where it is required: invested in our badly under-equipped recycling infrastructure. It also does not guarantee that more recycled material will be used, merely that ‘virgin’ ma

terial is more expensive.

Part of the problem is that products cannot be recycled because of limited collection and recycling infrastructure.

We said that the BPF believes the best way to reduce plastic waste is to reform the existing Packaging Recovery Note (PRN) system, which would ensure any money raised is reinvested in the UK’s waste collection and recycling infrastructure. The PRN system is already a ‘plastics tax’. Reforming the system could see companies producing difficult-to-recycle packaging paying more, meaning unsustainable products are likely to be phased out. This means that, worst case, consumers will only have the cost of some specific products passed on in the short term.

Reforming the PRN system so that it no longer incentivises the export of plastic waste will provide a much-needed confidence boost to UK plastics recyclers, will allow these businesses to grow, decrease reliance on other nations and help the UK to develop its innovative recycling technologies. If the UK’s plastics recycling capacity is significantly extended and modernized by 2030, an estimated 25,000 new jobs could be created.

These were messages communicated to our recent Parliamentary Reception in the House of Commons at which two Government Ministers spoke. You can read more here.