All things considered, ReHubs estimates a €5-6 billion shortfall in EPR funding, noting that most EPR schemes won’t even start collecting fees until 2028. Plus, with the EU backpedaling on key regulations, undermining the incentive for circularity, many of the private investors that could plug the gap are spooked. “Before, investors were willing to invest because the legislation train was running at full speed. Now, they’re willing to invest if we are, which means half the funding still has to come from the EU.”
So who is responsible for deciding how the funds are actually spent? That falls to the producer responsibility organizations (PROs), but it’s not as simple as one per country. “So far, the Netherlands has three PROs and Italy has eight,” says van de Kerkhof. “We’re talking about competing initiatives with completely different set-ups, each of which have overheads to pay. It’s going to be extremely difficult.” (This conversation is gaining pace in Europe. Just this week, organizations including the Global Fashion Agenda, Euratex and Ecommerce Europe put out a joint statement calling for PROs to remain producer-driven, with a clear distinction between regulator, supervisor and operator, and for efforts to be harmonized across member states.)
Moving money across borders
As with any funding earmarked for impact, there is also the question of where money is best spent, says Elmar Stroomer, co-founder of Africa Collect Textiles (ACT), which collects, sorts and transforms textile waste in Kenya. “If you have €1 million from EPR funds and you are in the Netherlands, you might be able to bump up your used textile collection rate by 5%,” he says. “But if you spend the same money in Kenya, where the collection rate is currently close to zero and the lack of infrastructure means textile waste is being burned outside or flowing into rivers, you could have a much bigger impact.”
Even if European countries agreed to send some of their EPR funds to countries on the receiving end of used clothing shipments, moving money across borders is seen as “legally challenging”, says Stroomer. But policymakers are going to have to overcome this perception, whether they adopt globally accountable EPR or not.
Used clothing is regularly exported from Europe to the Global South, but policymakers say moving EPR funds in the same direction would be challenging.Photo: Bella Webb