One Too Many

There is a need to do something to get Scots recycling more. Great progress was made up until the early 10s, with levels of recycling more than doubling to 40% of waste by 2011. Since then, though, progress has slowed. 42% was recycled in 2020, which represented a fall on 2019. [1] [2] Enter the Deposit Return Scheme (DRS).

It’s not every week that an SNP policy gets described as ‘worst idea I’ve seen in 43 years in politics’, by a former SNP minister [3], but the Drinks Return Scheme has earned such an accolade. Our Scottish Future would not go so far – the principle behind the scheme is one we’d support, and they work well overseas – but the Scottish Government are unnecessarily increasing its complexity and costs. Indeed, it has been decried as “one of the most difficult schemes of its type in the world, which makes it one of the most expensive and most difficult to negotiate” by brewers [4]. What’s going wrong?

One issue comes from the lack of cooperation on the scheme across the UK. The Westminster Government is in the process of putting in place its own from 2025, 1-2 years after the Scottish programme. They will be operationally similar, but in England it will not include glass, unlike in Scotland and Wales.

The Scottish Government will therefore be able to claim to be leading the UK on this issue. Sometimes, that rivalry can play out without much damage. In this case, however, it makes the Scottish border a mountain range of red tape for any beverage manufacturers wishing to sell their products in the rest of the UK. The schemes are not interoperable. That means that brewers require “different labelling for Scotland and the rest of the UK [which] involves additional storage SKUs [stock keeping units] and different labelling and barcodes” according to the same SNP former minister. [3]

The industry agrees that cooperation is the way to do it. Barry Watts, Head of Policy and Public Affairs at the Society of Independent Brewers (SIBA) said:

“A Deposit Return Scheme (DRS) has the potential to significantly improve recycling rates and our impact on the natural world, but only if it is well designed. Sadly having a separate scheme in Scotland and then different criteria in the rest of the UK is creating huge costs and confusion for consumers and small producers and will inevitably reduce choice and increase prices.

“To make this work for consumers, businesses and the environment we need one scheme that comes in at the same time, with the same scope and covers the whole of the UK. It is time that all the devolved Governments worked together to achieve a joined up DRS.”

Even without the border issue, costs are high for businesses. They could mean a bill of £15,000-£20,000 “even for pretty small to middling-size businesses” [3]. One brewer estimates that it would add 10-15p onto the cost of every can of beer sold of Scotland. [5]

There are also legal concerns. Aidan O’Neill KC suggests that the UK Internal Market Act of 2020 may be breached by the 20p charge – it creates a difference in prices between Scotland and the rest of the country. The Scottish Government is awaiting a decision from Westminster on this. [5]

Meanwhile, implementation is running behind schedule. The launch had already been postponed from July 2022 to August 2023, and many think that the scheme should be postponed again, especially for smaller producers. Whisky consultant Blair Bowman thinks that it is “literally unworkable as it stands, and it will cause businesses to fail. There are all of these implications that haven’t been worked out” [6].

Rather than running headfirst into what is set to be a chaotic launch of the scheme this August, the Scottish Government should take the time to pause. Reflect. Is a single-nation scheme really better, in this instance, than one with UK cooperation laced through it? Is it worth putting that extra burden on our drinks producers, one of the jewels in Scotland’s economic crown? Is it worth the confusion for those who move back and forth along the border, about which bottle they’re allowed to take back where? Surely the answer is to listen to industry bodies and listen to common sense – a DRS for Scotland, separate to the rUK scheme, is one DRS too many.

What is the Bottle Deposit Return Scheme?

The Scottish scheme works by adding 20p onto the price of a single-use drink. Producers have to adjust the labelling or add a sticker to mark the product as eligible, and a special barcode will prevent fraud (to stop the same bottle being reimbursed multiple times). Anywhere that sells single use containers has to operate as a return point, from major grocers down to corner shops and takeaways (unless they are exempt). Outsourced ‘Scheme Administrators’ may be able to help vendors and manufacturers with some aspects of the process.

Bibliography

[1] SEPA, [Online]. Available: https://media.sepa.org.uk/media-releases/2021/official-statistics-publication-for-scotland-household-waste-summary-jan-dec-2020-waste-landfilled-in-scotland-2020-and-waste-incinerated-in-scotland-2020-statistics.asp.

[2] Scottish Government, [Online]. Available: https://www.gov.scot/publications/delivering-scotlands-circular-economy-consultation-proposals-circular-economy-bill/pages/6/#:~:text=Our%20recycling%20rate%20remained%20at,recycling%20targets%20without%20significant%20action.

[3] The Times, “Drinks deposit ‘worst idea I’ve seen in 43 years in politics’,” [Online]. Available: https://www.thetimes.co.uk/article/drinks-deposit-worst-idea-ive-seen-in-43-years-in-politics-s0kbnb6k3.

[4] The Scotsman, “Deposit return scheme: Scottish lawyer claims plans could create unlawful trade barrier,” 2023. [Online]. Available: https://www.scotsman.com/business/consumer/deposit-return-scheme-scottish-lawyer-claims-plans-could-create-unlawful-trade-barrier-4019771.

[5] BBC, “Unlawful trade barrier warning over bottle return scheme,” [Online]. Available: https://www.bbc.co.uk/news/uk-scotland-64563015.

[6] The Spirits Business, “Deposit return scheme: good or bad?,” 2023. [Online]. Available: https://www.thespiritsbusiness.com/2023/01/deposit-return-scheme-good-or-bad/.