The UK government has announced a £1.1 billion investment to overhaul recycling services across towns and cities in England, funded through packaging reforms. Circular Economy Minister Mary Creagh confirmed that the funding will support infrastructure improvements and modernized waste collection systems. This marks a major shift from the previous system, where local councils and taxpayers bore the financial burden of packaging waste disposal.
The new Extended Producer Responsibility for Packaging scheme will make businesses that produce packaging pay for the cost of its recycling. Under this scheme, companies will face higher fees for hard-to-recycle materials, encouraging a shift toward more recyclable and reusable packaging. The reform aims to reduce landfill use and incineration by driving sustainable product design and waste reduction at the source.
As part of this initiative, £1.1 billion will be distributed to councils to improve local recycling services. This includes funding for streamlined household waste collection, facility upgrades, and new infrastructure projects such as the Southwark Integrated Waste Management Facility operated by Veolia. Councils are expected to use this funding strictly for improving packaging waste services, and misuse could result in reduced future allocations by PackUK.
The reforms are projected to create 25,000 green jobs and attract £10 billion in investments for new waste sorting and processing facilities over the next decade. They also include the upcoming Deposit Return Scheme in 2027, which will reward consumers for returning empty drink containers for recycling.
In addition, Simpler Recycling was introduced for workplaces in March 2025 and will extend to households by March 2026, aiming to increase recycling rates and minimize landfill waste. The government’s broader Circular Economy Strategy, to be released in autumn, will provide sector-specific roadmaps for more sustainable material use, developed in collaboration with the Circular Economy Taskforce.
