A step up in enforcement action has roped nearly 1,800 additional producers into the net of the government’s extended producer responsibility packaging tax, it has revealed.
Responding to a parliamentary question last week, Defra minister Emma Hardy said tougher action by the Environment Agency, alongside improved data capture by Defra and PackUK, was improving the accuracy of future fee calculations.
It follows the embarrassing Treasury bailout at the end of the first year of the controversial tax, which saw an emergency “one-time intervention” used to balance the books, after the revenue fell tens of millions of pounds short of predicted forecasts.
The government had also been under pressure to chase an alleged army of EPR tax dodgers, after an investigation revealed by The Grocer in February showed many companies were exploiting loopholes in the funding model to avoid paying the fees.
A probe of Companies House information, carried out by the foodservice Packaging Association (FPA) showed the first EPR bills landing last year coincided with a massive spike in the registering of small packaging firms, many of them one-man bands.
It claimed they were being used as a vehicle for food companies to bypass the ‘producer pays’ packaging principle.
Responding to a question from Conservative MP Wendy Morton, Hardy said: “Defra, PackUK and regulators are improving future fee calculations using refined guidance and calculations, and strengthening compliance activity, which has brought almost 1,800 additional obligated producers into compliance.”
This week the FPA said it welcomed the tightening of enforcement but called for more transparency over what type of companies had been brought into the fold.
A spokeswoman for the body said: “Confirmation that compliance action has brought almost 1,800 additional obligated producers into the pEPR system is significant and reinforces why effective enforcement is fundamental to confidence in the scheme.
“We would welcome greater transparency on how the additional 1,800 producers were identified, the packaging tonnage they represent and what effect bringing them into compliance has had on the overall producer fee base.
“Equally, producers should have confidence that the substantial sums raised through pEPR are being used for the efficient management of packaging waste, so confirmation of PackUK’s oversight and recovery powers is important.”
Meanwhile PackUK bosses told Defra’s Circular economy Joint Stakeholder Forum last week that subject to data assurance by the four national regulators it intends to publish year two fees for EPR in November.
In July, The Grocer revealed the body had brought forward the deadline for manufacturers to submit any amended EPR data to this month, in a bid to improve the accuracy of its calculations and prevent a repeat of last year’s shortfall.
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