29 August, 2025

Summer headlines are easy to miss, but one worth catching was the government’s announcement that councils will be given £1.1 billion to boost recycling services across England. Where will they find the money? From the businesses who produced the waste in the first place, as part of the UK’s new Extended Producer Responsibility (EPR) scheme which means businesses pay for each tonne of packaging material that they put onto the market.  

The scheme has been controversial. Retailers have already raised concerns about higher costs, and some of those will inevitably show up on price tags. But this is legislation doing exactly what good legislation should: aligning commercial and environmental incentives. When businesses face the real cost of their packaging choices, innovation follows – lighter materials, fewer layers, and more recyclable options. Crucially, it also levels the playing field. Companies already investing in sustainable packaging are no longer at a disadvantage compared to those relying on cheap, hard-to-recycle materials. 

The benefits don’t stop there. The revenues raised are designed to strengthen recycling infrastructure, spur innovation in waste processing, and create jobs. With the EU moving towards harmonised EPR rules, UK businesses that get this right now will also have a head start on the continent. Done well, it’s a step towards a circular economy, where waste is designed out and resources stay in use for longer. 

The caveat? Infrastructure needs to keep pace. Without investment in the systems that actually collect and process this material, the costs will bite without the promised benefits. But if the funding flows where it should, EPR could make both business and the environment better off.

By Louise Podmore