The Metal Packaging Manufacturers Association (MPMA) has welcomed the appointment of Exchange for Change to run Wales’ Deposit Return Scheme (DRS), saying it removes a major obstacle to UK-wide interoperability and allows the focus to shift to implementation.

The association warned, however, that decisions taken ahead of the planned October 2027 launch must avoid unintended consequences for different packaging materials and wider sustainability objectives.

Jason Galley, director and chief executive of the MPMA, said: “The appointment of Exchange for Change as the Deposit Management Organisation (DMO) for the Wales DRS removes a major barrier to progress and interoperability between the UK’s schemes but attention must now shift quickly to delivery and avoiding unintended consequences.

“After a period of delay and uncertainty, the metal packaging sector needs clarity, momentum and a practical route to interoperability if UK-wide schemes are to be on schedule and deliver the environmental benefits they promise. With a little over a year until the launch date in October 2027, there is no room for further delay. Success will depend on rapid, coordinated action to establish infrastructure, prepare businesses and build consumer buy-in.”

The MPMA also raised concerns about the proposed use of a flat-rate deposit across beverage containers, arguing that charging the same amount regardless of size, material or recyclability could influence purchasing decisions.

Galley said: “One area requiring careful reconsideration is the proposed use of a flat-rate deposit across all beverage containers, regardless of size, material and recyclability. The financial burden on consumers should not be underestimated. A shopper buying 10 x 250ml canned beverages would face an additional £1.80 upfront deposit versus a single 2.5l plastic bottle through the flat-rate deposit of 20p per container. At a time when household budgets remain under pressure, these additional fees risk undermining public support for the scheme.

“While simplicity has its advantages, policy design should not inadvertently incentivise consumer behaviour that runs counter to wider goals. Put simply, a flat-rate deposit across all container sizes encourages consumers to choose larger-format, less-circular packaging, undermining environmental objectives. Portion control and minimising food waste are additional goals that are undermined by a flat-rate deposit approach that guides the consumer to larger-sized containers. Achieving high-performing recycling systems requires policies that are supportive of the most circular packaging, evidence-led and well thought-through.”

The association said DRS policy should also be considered alongside wider packaging Extended Producer Responsibility (pEPR) reforms, particularly given the different treatment of glass across the UK.

Galley continued: “A 2021 ministerial decision to exclude glass from the DRS in England, Northern Ireland and Scotland is already distorting the market. It remains to be seen how consumers will react to the choice between DRS and DRS-exempt containers.

“With Wales including glass in DRS collection, we expect future calls for the transition of collection funding away from EPR to DRS, increasing the burden on the remaining EPR packaging formats. This is especially damning for the steel can, which due to its 9 times higher density, will pick up a disproportionate burden under Defra’s weight-based system compared to competing plastic and fibre-based composite cartons.”

The MPMA also questioned calls for an immediate 75% reduction in glass pEPR fees while the wider system is reviewed, particularly if the resulting costs were redistributed across other packaging materials.

Galley said: “The call to introduce an immediate 75% reduction in glass pEPR fees while a wider review of the scheme is undertaken poses further real-world issues. How will it be paid for? If funded from outside the EPR budget, it would make the fee for a steel container some 40% higher than for a glass food jar which does not make sense considering the relative amounts of material each container uses.

“And it could get worse depending on how it is proposed that this £300 million or so discount is funded. One thing that has to be avoided is the redistribution of costs across other packaging formats. MPMA calculations show that such a move would increase the already perverse EPR premium to buy steel – the most recycled packaging material – to around 75% vs plastic and fibre-based composite cartons and 50% vs glass.

“Changes that reduce fee obligations for one material inevitably alter the cost burden elsewhere. So depending upon how the Government reacts, jobs saved in one packaging sector can translate to jobs lost in another. There is a risk of creating market distortions, undermining investment confidence and generating unintended outcomes across not only packaging supply chains but across those vital metals that are the subject of strategic government intervention elsewhere.

“While Defra faces a complex challenge of its own making, a wholesale discounting of glass pEPR fees is not the answer if it increases the burden on steel. Ministers, policymakers, Exchange for Change and PackUK must consider not only the impacts on one industry but also the knock-on consequences for others.”

Galley said packaging reforms should ultimately reflect the circularity performance of different materials rather than create advantages for particular packaging formats through policy intervention.

“As governments refine deposit return schemes and wider packaging reforms, it is important that policy reflects the environmental contribution of highly circular materials. Successful recycling systems depend on recognising the value different materials bring and ensuring incentives support, rather than undermine, established circular supply chains. The objective of packaging reforms should be to reward circularity performance, not to create winners and losers through skewed policy intervention.

“Metal packaging manufacturers possess considerable technical expertise and operational knowledge that can help support successful implementation. Constructive engagement between MPMA and the DMO will be particularly important as scheme details are finalised and we work together to create a successful, effective recycling system that maximises circularity. The priority now is to get on with its delivery.”