Who Pays for the Bin

Into the late 1980s, the soft-drinks firm Corona still charged a ten-pence deposit on a glass bottle, and printed the figure on top of the screw cap so it stayed visible when the bottles were stacked in crates — a reminder that the cap, too, had to come back to redeem the coin.¹ Dairies ran the same loop on milk: the bottle was reused up to forty times, returned at the doorstep, washed, refilled.¹ During the Second World War the government issued an emergency order to force milk bottles back into circulation; some adverts threatened prosecution for keeping them.¹ For roughly a century and a half, the cost of the container you carried home sat in your hand as a refundable coin. You could see it. You got it back.

Then it disappeared. Not because shoppers rejected the deposit, but because the logistics that made it work — door-to-door delivery and collection — stopped paying their way. As the History & Policy account of the period puts it plainly, the returnable system "ceased to be economically viable with the rise of the supermarkets."¹ The bottle still cost something to dispose of. The cost did not vanish. It slid out of your hand and into two places you could no longer see: the council tax bill, and the environment.

By 2017 the arithmetic of that slide was on the parliamentary record. The House of Commons Environmental Audit Committee found that the companies who made packaging covered only around 10% of the cost of dealing with it once it became waste. Taxpayers — through their councils — funded the other 90%.² That is the fact worth holding before anything else in this report: for decades, the people who designed and profited from the packaging paid a tenth of its disposal, and everyone else paid the rest, invisibly, whether they bought the product or not.

So when a new fee starts landing on your shopping in 2026-27 and your bill ticks up, the honest first thing to say is the calm thing. This is not a stealth tax invented to fleece you. It is the bin coming back into view. The cost was always there; the policy that is now arriving — packaging Extended Producer Responsibility, live since April 2025 — simply changes who gets the invoice, moving it from the council back toward the producer who made the packaging in the first place.² That is sound. The polluter-pays principle is one of the least controversial ideas in environmental economics, and the externality it is correcting here is real and large: the government's own estimate is that the scheme shifts around £1.2 billion a year of disposal cost from local authorities onto producers.²

This report is not an argument against that. It is an argument about what the fee is actually charging for in the one year you first feel it — and why, even though the tax is right, paying more may not buy you the thing you think you are paying for.

10%

That is the share of packaging-disposal cost producers used to carry, and it is the number that makes the whole reform legitimate. Everything else follows from the attempt to move that 10% up toward 100%.

Here is how the new fee is built, because the structure is the whole story. A producer pays for the packaging it puts on the market according to a published per-tonne rate, and the rate depends on the material. The confirmed 2025 base fees on GOV.UK span a wide band: glass is the cheapest at £192 a tonne, fibre-based composite the dearest at £461, with plastic at £423, paper and card at £196, aluminium at £266 and steel at £259.³ Cheapest to dearest is a spread of about 2.4 times. And at this stage, 2025-26, that is all there is: the fee is flat per tonne, and recyclability does not enter into it.³

From 2026-27, recyclability does enter — and this is the part everyone is talking about. The flat per-tonne fee becomes modulated by a red-amber-green grade. PackUK, the scheme administrator, sets out the mechanism in its Producer Disposal Fees Modulation Statement: the disposal-fee element is multiplied by a factor that depends on the grade.⁴ Amber is the baseline — "no change," in the document's own words. Red is charged at 1.2 times amber in 2026-27. Green earns a discount, funded out of a redistribution pot built from the red surcharges.⁴ So the headline is clean and reassuring: hard-to-recycle packaging costs more, easy-to-recycle packaging costs less, and the shelf should drift toward green.

The trouble is in the size of that grade adjustment relative to everything underneath it. The red premium is 1.2 times in the first graded year — twenty per cent. The green discount, on the regulator's Year-2 illustrative figures, is around nine per cent below amber.^4,5 So the recyclability grade — the thing the entire public conversation is about — moves a producer's bill within a narrow band: roughly minus nine to plus twenty per cent. That band rides on top of a much larger base. The base already spans 2.4 times across materials before any grade is applied, and it is then multiplied by how many tonnes the producer puts on the market.

Hold those two terms side by side. The grade: a band of about thirty percentage points. The weight-and-material base: a 2.4-times spread, multiplied by mass. The grade is a thin rider. The weight is the engine. And almost nobody multiplies the three terms — weight, material, grade — all the way through to see which one is really setting the bill.

So let us do it.

0.38p

That is what the new fee charges a producer for a light, unrecyclable plastic pouch — and it is the number that should change how you read every price rise this year.

The Recipe for the fee is not complicated. Take the pack's weight, convert it to tonnes, multiply by the regulator's published per-tonne rate for its material and grade, and you have the producer's fee for that pack. PackUK has now published the actual Year-2 modulated rates — not just the multipliers — so this can be worked on the regulator's own numbers rather than an approximation.⁵ Here is the receipt for three packs you handle every week.

THE RECEIPT — what the producer pays per pack, 2026-27 (regulator's own Year-2 rates)

  Multi-layer laminate pouch    ~7g   plastic (flexible), RED £545/t   →  0.38p
  Mono-PET drinks bottle      ~19.9g   plastic, GREEN          £415/t   →  0.83p
  Glass jar                    ~190g   glass, GREEN            £185/t   →  3.52p
                                                              ─────────────────
  The RED unrecyclable pouch costs the producer ~9x LESS than the GREEN recyclable jar.

Read the bottom line slowly, because it is the entire report in one breath. The laminate pouch is graded red, and under PackUK's Recyclability Assessment Methodology it cannot be anything else. A stand-up pouch achieves its feather weight by fusing micron-thin layers of polyethylene, PET and aluminium foil into one inseparable film. UK recyclers run mechanical routes that cannot separate those layers, which is why peer-reviewed work describes such multilayer packaging bluntly as "a non-recyclable environmental pollutant."^6,7 It is the least recyclable format on the shelf. The glass jar is graded green — mono-material, kerbside-collected, infinitely recyclable.^7,8

And because the fee charges mostly for weight rather than recyclability, the recyclable green jar — at 3.52p — costs the producer roughly nine times more than the 0.38p unrecyclable red pouch. The fee everyone believes rewards recyclability has, on this pair, charged the recyclable pack nine times harder — not because it is worse for the planet, but because it is heavier.

This is not a knife-edge result that depends on a flattering choice of weights. Push it to the limit in the producer's favour. Take the heaviest plausible pouch — twelve grams, at its worst red rate — against the lightest plausible jar — a hundred and seventy grams, at its best green rate. The jar still costs the producer 4.8 times more.⁵ For the pouch to merely draw level with the jar, it would have to weigh about sixty-five grams — roughly nine times the weight of a real stand-up pouch.⁵ No pouch reaches that. Across the entire defensible range of weights, the ranking never flips. The thin grade rider — plus twenty per cent, minus nine — is simply far too small to close a weight gap of roughly twenty-seven to one. Weight sets the order. The grade almost never overturns it.

That is the load-bearing finding, and it is worth being exact about what it does and does not say.

The feature that is also a blind spot

There is a clean, non-defensive answer to the receipt above, and it is the strongest thing anyone can say against this report, so it goes here in full rather than buried at the end.

A regulatory economist with no industry axe to grind would look at the 0.38p pouch and the 3.52p jar and say: good, that is the fee working. Disposal cost genuinely is, in large part, a function of mass. You pay to collect, haul, sort and reprocess physical tonnes, so heavier packaging should cost more to deal with, and a fee that tracks weight is tracking real cost. More than that: the waste hierarchy, written into UK and EU law, ranks using less material above recycling. A fee that "rewards lightness" is rewarding source reduction, which is the single most important circularity outcome there is. Coca-Cola Europacific Partners reports that the weight of its 500ml PET bottles has fallen 30% since 2008, from 28.9 grams to 19.9, saving thousands of tonnes of plastic a year.⁹ That is precisely the redesign the fee is built to produce — and it cuts the producer's bill and improves recyclability at the same time. So the receipt does not show a flaw. It shows the fee making heavy packaging expensive and pushing producers to use less. Calling that a mis-specification mistakes the policy's central feature for a bug.

Every clause of that is true, and this report concedes all of it. A weight base is administratively clean and broadly right. Lightweighting is usually good. Rewarding source reduction is sound. CCEP's lighter mono-PET bottle is the live proof: when a pack is a single material, going lighter and going recyclable point the same way, and the fee rewards both. There is no quarrel with any of that here.

The claim is narrower, and it survives the concession intact. Weight is a poor proxy for recyclability specifically. And on one material — the multi-layer laminate — the lightest pack is also the least recyclable. So a fee marketed as a recyclability signal charges the genuinely unrecyclable option less than the recyclable one, and nothing on the shelf tells the shopper which she is holding.

Notice where the conflict lives. For CCEP's mono-PET bottle, lightness and recyclability align — going lighter is going better, and the fee is right. The seam opens only on the laminate, where the very thing that makes the pouch light (fusing incompatible layers) is the thing that makes it unrecyclable. There, and there specifically, "go light" and "go recyclable" point in opposite directions, and the fee — because weight dominates — follows lightness. The report is not against taxing weight. It is showing the one documented place where a weight base, inside a fee sold as a circularity signal, rewards the wrong pack.

And the worry is not theoretical, because the substitution it predicts is already being reported.

43%

That is the share of brands and retailers a glass-industry survey found were considering switching away from glass — and of those, 77% said they would switch to plastic.¹⁰

The survey is British Glass's own, of 74 respondents — mostly brands and packaging makers — so it should be read as exactly what it is: stated intention, from a trade body whose material loses under a weight-based fee, not measured behaviour.¹⁰ It is attributed throughout to British Glass, and it is not proof that any single producer has switched. But it is a documented systemic signal, and its internal logic is the report's own. British Glass's complaint is that glass is around 5% of packaging waste by volume yet is projected to bear roughly a third of the total cost, "because it is heavy."¹⁰ Which is the receipt restated from the other side: the fee charges glass for its mass.

Here is the part that matters most, and it comes from the glass industry's own mouth rather than from any reading imposed on it. British Glass's verdict on the modulation is that it "will only double fees for the hardest-to-recycle materials by 2028, which the industry believe is not robust enough to prevent switching away from glass."¹⁰ Translated: the grade is too thin a rider to beat the weight bill. That is precisely this report's central finding — that weight dominates and the grade rarely flips the ranking — arrived at independently by the party with the most to gain from the fee being read the other way.

It does not follow that every switch off glass is a switch to something worse. A lighter recyclable plastic pack can have a lower total footprint than a heavy glass jar, and where a producer moves from glass to a recyclable mono-material, the fee may simply be doing its job. The worry is sharper and smaller than "glass good, plastic bad." It is that the fee's weight base rewards lightness indiscriminately — and lightness includes the recyclable mono-PET bottle and the unrecyclable laminate pouch, with the pouch cheapest of all. The shelf has no cue to separate the two. A shopper reaching for the lighter pack cannot tell whether she is choosing the genuinely better mono-material or the genuinely worse laminate, and on the producer's bill the laminate is the cheapest option in the aisle.

Which brings us to the word that is doing the most quiet work in all of this: recyclable.

The word that became a verdict on your council

When Sarah reads "recyclable" on a pack, she reads it as a property of the thing in her hand — a fact about the material, like its weight or its colour. From 2026-27, under the methodology that sets the fee grade, it is partly something else: a verdict on whether her council collects that material.

PackUK's Recyclability Assessment Methodology grades a pack across five stages. At the Collection stage, a component scores green only if it is "collected at kerbside by at least 75% of local authorities across the UK."⁸ Between 50 and 75 per cent of councils is amber; below half is red.⁸ And one red result at any of the five stages makes the whole pack red.⁸ So "recyclable" under the fee is, in part, a geographic and logistical fact about Britain's collection map — whether enough councils pick that material up — and not a fact about the molecule. A glass jar is green where it is collected. A laminate that could, in principle, be recovered by a novel solvent process is red, because no UK route collects and reprocesses it at scale.^6,8

This is why "paying more" carries so little information this year. A price rise on a heavy glass jar is, on the receipt, mostly the jar's weight talking — and the jar is the recyclable one. A small or invisible fee on a laminate pouch is the pouch's lightness talking — and the pouch is the unrecyclable one. The fee does not announce which it is. The grade everyone is debating is, in 2026-27, a thin adjustment on a much larger weight bill, and the shopper has no way to read either term from a shelf-edge label or a till receipt. "Recyclable" looks like a promise about the pack. It is partly a report on her postcode.

Half a percent — and the bill you can't decompose

So far this has all been about the producer's invoice. The shopper's question is different: how much of it reaches me, and can I see it?

On the first part, the answer is: most of it, probably. The British Retail Consortium reported in October 2025 that retailers expect to pass on about 80% of pEPR costs to customers, with the BRC's Andrew Opie calling it "a multi-billion pound levy being paid by consumers during a cost-of-living crisis."¹¹ That figure is the BRC's expectation, not a measured outcome and not a prediction this report endorses — pass-through depends on competition, and a fiercely contested grocery market may absorb more than a lobby expects. But it is not the retailers' number alone. The government's own impact assessment assumed 85% pass-through, putting the cost at around 91 pence a week for the average household.² Two independent expectations, both near four-fifths.

On how much that adds to prices overall, there is a number worth correcting, because the trade press got it wrong and the wrong version travelled. The Bank of England, in its August 2025 Monetary Policy Report, as cited in the House of Commons Library briefing CBP-10352 (January 2026), estimated the scheme "could add a little over ½% to the level of food prices if these costs were fully passed through to consumers."² Half a percent — not the "a little over 1.5%" that appeared in some coverage, which is three times the Bank's actual figure.^2,11 The honest number is half a per cent to the level of food prices, conditional on full pass-through. Real, but modest.

The problem is not the size. It is that the cost arrives inside a basket you cannot take apart. When the jar of jam costs more, nothing on the receipt tells you whether the rise is the new fee, the cost of the harvest, energy, wages, or the retailer's margin. The fee disappears into "the price went up" — the same undecomposable sentence that has explained every grocery rise for three years.

And there is a second channel that makes the basket feel heavier than the half-percent suggests. pEPR is designed to move the disposal cost off councils, so in principle the pressure it used to put on council tax should ease. But the household never sees that side of the ledger. The roughly £1.4 billion committed to councils for 2025-26 is widely reported as money that fills funding gaps rather than cutting anyone's council tax.² So from where Sarah stands, the council bill did not visibly fall, and the grocery bill rose. This is not an allegation that anyone is charging the same cost twice on purpose — in the public accounts the transfer nets out, and the policy is designed to move cost off councils. The point is narrower and structural. The relief and the new charge land in different budgets, on different bills, at different times, with no line connecting them. So the shopper cannot see the reconciliation, and the cost-shift is not legible to her household.

There is a fairness wrinkle in where the cost now sits, too. Council tax is imperfectly progressive — banded by property value, with reductions for low-income and vulnerable households. A fee embedded in grocery prices is regressive: food is income-inelastic, and the poorest spend a far larger share of their income on it. Moving a cost from a relief-eligible, banded channel to a flat, unavoidable shelf price lands the same pound harder on a lower-income household than the council-tax version did.² That is a property of the collection point, not an accusation against anyone — but it is a real consequence of where the invoice now goes.

The one coin you actually act on

If the embedded fee changes nothing the shopper does, is the answer simply to make it visible — print it on the receipt, the way the carbon footprint sometimes appears, so people can see what they're paying?

It is a reasonable instinct, and the evidence says it can backfire. Hartmann, Marcos and Barrutia, in Global Environmental Change in 2023, ran four experiments and two pilots on a visible carbon tax. They found it was less effective at cutting demand than a hidden one. Being aware of paying activated moral licensing — a sense of "I've done my bit" — so purchase intention actually rose when the tax was made visible, and the effect was strongest among the most climate-concerned.¹² That is one study, on a carbon tax, measuring intention rather than tills — so it should be held lightly. But set it against the case where salience plainly worked: England's 5p plastic-bag charge in 2015, which cut single-use bag use by about 80%.¹³ The difference between the two is the whole lesson. The bag charge worked because it came with an instant, free, do-able alternative — bring your own bag. The shopper could act on the visible price the same minute she saw it. A fee printed on a pack she cannot un-laminate gives her nothing to do with the information.

So the design rule is not "hide the fee." It is "attach the visible price to an action the shopper can actually take." And measured against that rule, there is exactly one piece of money in the whole 2026-29 system that qualifies — and it is not the embedded fee at all.

From October 2027, a Deposit Return Scheme starts in England, Scotland and Northern Ireland on single-use drinks containers from 150ml to 3 litres in PET, steel and aluminium — not glass, in those nations, though Wales runs a separate scheme that includes it.¹⁴ DEFRA is explicit about how it differs from the packaging fee: "the Deposit Return Scheme will not be a tax — the deposit will be paid back to consumers upon returning the drinks container."¹⁴ The deposit level is not yet set, so no figure should be quoted as policy.¹⁴ But the shape of it is the point. The refundable deposit on a can is visible, it is yours, and you get it back by doing one specific thing. It is the only behaviour-changing money in the system. The embedded fee on your weekly shop is sunk, invisible, and changes nothing at the till. One is the demolished doorstep deposit, restored in miniature on a single category. The other is the cost that slid into the council bill, coming back invisible.

What would change this reading

This is a finding about one year's geometry, and it has a known expiry, which the report should say out loud.

The grade adjustment is deliberately back-loaded. PackUK's own words are that the factors are "designed to increase incrementally," giving producers a redesign runway — red rises from 1.2 times in 2026-27 to 1.6 in 2027-28 and 2.0 by 2028-29.⁴ That is defensible policy design, and judging the principle by its first graded year would be unfair. As the rider steepens, the grade begins to bite harder against the weight base, and the seam narrows. So the central finding here weakens — by design — over time, and it weakens further if the confirmed Year-2 fees due in June 2026 turn out steeper than the illustrative figures used above. It would weaken sharply if those confirmed fees showed the grade routinely flipping the ranking that weight sets, or if representative pack weights showed a light red pack did not out-cost a heavy green one. They do not, on the regulator's published numbers: the nine-times reversal is so large that plausible fee revisions cannot close it.

The honest counter-evidence is real and belongs here, not hidden. The externality genuinely is being internalised — that is the whole legitimacy of the reform. Redesign is genuinely happening: CCEP's lighter mono-PET is real, and GoUnpackaged's modelling finds that shifting 30% of grocery retail to reusable packaging could save producers around £136 million a year in these very fees, because reusables are counted once on first use rather than on every rotation.^9,15 The signal is engineered to steepen. And two trade bodies from opposite material interests converge on the same structural reading — that the Year-2 signal is too shallow to drive redesign. British Glass loses under a weight fee. The Foodservice Packaging Association does not, yet its executive chair Mike Revell warned the scheme risks functioning "as anything other than a retrospective tax."^10,16 The report sides with neither grievance. It reports the convergence.

What does not auto-expire as the grade steepens is the part that matters most to the shopper: even at the steepest 2.0-times rider, the fee on her weekly shop stays sunk and invisible at the till, and the refundable can stays the only money in the system she can act on. The geometry seam narrows. The legibility seam does not.

So both things are true at once, and that simultaneity is the finding. The system is mostly working — the right tax, fixing a real cost, landing in the wrong place in its first graded year. And the shopper cannot read, from any price, label or receipt, whether her 2026-27 price rise means the system working or the cost forwarded. Those are not in tension. They are the same shelf, seen from two heights.

What to do on Saturday

You are standing in the aisle, two packs in your hands, and neither will tell you its own biography. Here is the read that does most of the work for you, unaided by the label.

Read any 2026-27 price rise in two steps.

Step one: is this mostly the pack's weight talking, or its grade? The weight is the engine — a heavier pack almost always carries the bigger producer fee regardless of recyclability, and the grade moves the bill by only about minus nine to plus twenty per cent. So a price rise on a heavy glass jar is mostly its mass, not a verdict that it is "worse." If anything, the heavy jar is more likely to be the recyclable one. The light pouch's small fee is its lightness, not its virtue.

Step two: even where the grade does bite, is it attached to something you or the producer can actually act on — a loose, refill, mono-material or lighter-but-still-recyclable option, or the refundable can — or is it a sunk price with nothing to do behind it? The fee that changes behaviour is the one you can act on. The embedded fee on a single-use pack you cannot un-laminate is not it.

And the lever that actually cuts the bill is not paying more for the same single-use pack. It is less packaging. Concretely, three moves, including one that has nothing to do with anything we might one day stock:

• Choose loose, refill or mono-material over multi-layer laminate where the option exists — the pouch that feels modern and light is, on the fee and in the bin, the worst of the three. Reuse and refill are the levers that genuinely shrink the cost (GoUnpackaged puts the saving from a 30% reuse shift at around £136 million a year).¹⁵
• Prefer a single-material pack — one polymer, or glass, or single-grade PET — where your council collects it, because "recyclable" under the fee is partly a verdict on your collection map, not the molecule. A mono-material pack your council takes is both genuinely recyclable and, if lightweighted, low-fee.
• For drinks, from October 2027, the refundable can is the one coin you get back by acting — unlike the embedded fee, which you never see again.¹⁴ A wholly mainstream option, no allegiance required: the deposit is the most honest piece of money in the system precisely because you can put it back in your own pocket.

The bin was never free. For a century and a half its cost sat in your hand as a coin you could see and reclaim; then the doorstep loop collapsed and the cost slid into the council bill and the air. What is arriving now is that cost coming back into view — the right tax, fixing a real and long-standing wrong. But in the year you first feel it, the fee is charging mostly for weight, the recyclability grade everyone is arguing about is a thin rider on top, and the recyclable pack you were told to choose can cost the producer nine times more than the unrecyclable one — with nothing on the shelf to tell you which is which. So read the weight before the grade, find the action behind the price, and keep the one coin you can still reach. That coin is the closest thing on the 2027 shelf to the deposit your grandparents got back at the door.