UK regulators have cut 2026 packaging recycling obligations to 83% of the original level for plastic, 92% for steel and 90% for wood, after evidence showed the market will not generate enough Packaging Recovery Notes (PRNs) for producers and compliance schemes to meet their full legal obligations this year.

The four UK environmental regulators, including the Environment Agency, issued a new Regulatory Position Statement (RPS 383) setting out the reduced percentages. Under the statement, producers and compliance schemes will not normally face enforcement action where they achieve the reduced shares of their 2026 recycling obligation for the three materials, which regulators consider most at risk of non-compliance.

The reductions are a temporary measure and apply only for the rest of 2026.

Why did Defra intervene now?

Environmental consultancy Ecosurety says the evidence is clear: the market will not produce sufficient PRNs for all producers and compliance schemes to meet their full 2026 obligations. Without intervention, the UK would risk missing its legally binding packaging recycling targets.

Defra had previously signalled it would consider mitigating actions if evidence showed a material risk to meeting the 2026 producer recycling obligations. That evidence has now arrived, and the department has acted.

A Defra spokesperson said: "We are alive to the concerns raised and are working with regulators on ways to reduce those pressures."

"The action being taken will support businesses who want to do the right thing, ensuring that we maintain strong recycling performance whilst setting ambition at the right level."

The spokesperson added: "We want to ensure the system works well for all stakeholders and delivers recycling outcomes. We will work with all sectors to achieve this."

What changed in the PRN market at the start of 2026?

Two structural changes hit the system this year. From the start of 2026, exporters can only issue evidence for export PRNs when packaging waste is received by an accredited overseas reprocessor — not, as previously, when the waste leaves the UK.

That rule change landed alongside new IT systems and upgraded reporting requirements, compounding pressure on the evidence market.

For context: a PRN is a document issued to a producer or compliance scheme by an accredited UK reprocessor as evidence that the reprocessor has received a specific tonnage of packaging waste. Producers use this evidence to demonstrate compliance with their recycling obligations.

How significant is this intervention?

Ecosurety describes the move as "unprecedented" in the almost 30-year history of the UK's PRN system. The intervention aims to ensure businesses do not face enforcement action where compliance is not possible through no fault of their own.

Robbie Staniforth, Chief Policy & Impact Officer at Ecosurety, said: "The decision to intervene has not been taken lightly and follows regular stakeholder engagement throughout the last few months."

He pointed to the convergence of pressures behind the shortage: "The combination of changes to export rules, new IT systems and upgraded reporting requirements has caused unprecedented instability this year."

"Recycling targets were set when the impacts of these changes were not fully known. Therefore, officials have been left with no choice but to intervene with this RPS."

What happens next?

The reduced percentages apply to 2026 obligations only. For aluminium, glass, paper and other materials outside the three named streams, original obligations stand unchanged.

The key milestone to watch is the end of the 2026 compliance year, when the temporary RPS expires and regulators must decide whether the PRN market can support a return to full obligations — or whether the export-evidence rule change has permanently reset the system's capacity. Defra's commitment to "work with all sectors" suggests further adjustments remain on the table if tonnage evidence continues to fall short.