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Retailers and suppliers unite to call for action on PRN prices.

Byline: Ronan Hegarty

Retail and supplier leaders have issued an urgent call to government for action over the soaring cost of recycling compliance via the controversial PRN scheme.

In a letter to Defra seen by The Grocer, the BRC and FDF - along with the British Plastics Federation and Coke boss Leendert den Hollander in his capacity as chair of the Food and Drink Sector Council's packaging working group - claimed unbudgeted financial pressure from increasing PRN prices was adding 'tens of millions of pounds to compliance costs in 2019'. This was happening 'without any evidence the additional money is being used to improve the recycling system', they said.

The letter called on the government to 'look urgently at all regulatory and non-regulatory options to help alleviate the situation as soon as possible'.

Brands and retailers pay the cost of the Packaging Recovery Notes to waste processors who recycle the material on their behalf. The money is then supposed to be invested into improving the wider recycling system.

However, business leaders have become concerned waste packaging reprocessors and exporters are not reinvesting the money properly and are 'undermining the integrity of the whole system if they unduly hold onto PRNs in order to make financial gains during periods of shortage'. They claimed plastic PRN prices in June were PS450 per tonne, an increase of 750% from PS60 in June 2018. This could add PS20m in extra cost for one large retailer alone, they said.

'This money could have been invested in making packaging more recyclable, helping customers to recycle more or addressing food waste, but is flowing into a black hole,' the letter said.

'This price volatility appears to be a direct result of shortcomings in the current system and the high cost of PRNs will not result in increased recycling levels. Whilst producer businesses are not the cause they have to shoulder the very significant increased costs.' The parties are now calling on the government to legislate to introduce a compliance fee mechanism that would help prevent excessive pricing.

CAPTION(S):

PRN money is meant to be invested in recycling

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Comment:Retailers and suppliers unite to call for action on PRN prices.(News)
Author:Hegarty, Ronan
Publication:Grocer
Geographic Code:4EUUK
Date:Jul 13, 2019
Words:349
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