Chamber and committees

We are analysing the text of the Act to understand how it could interact with Scotland’s Deposit Return Scheme (DRS), but in order to assess impact fully we need to understand the UK Government’s intentions for its own DRS. We have not yet seen their response to their recent consultation.

Participation of small producers is vital to the success of the scheme and we believe we have taken their needs into consideration in designing DRS.

We have consulted extensively with businesses of all sizes that will be affected by the implementation of Scotland’s Deposit Return Scheme. We are not aware that any producers have decided to cease doing business in Scotland, although we are aware that some have expressed concerns about whether they will continue to sell their products in Scotland.

This is one of the reasons why we have applied a de minimis for the SEPA registration fee. This will remove a cost for businesses operating below the current VAT threshold, benefiting around 1,600 of the more than 4,000 anticipated producers selling into the Scottish market

Information relating to the ‘steady state’ costs can be found in Section 3.3 of the Full Business Case Addendum which was published on 16 March 2020 and can be downloaded here: https://www.gov.scot/publications/deposit-return-scheme-scotland-full-business-case-addendum/documents/ .

The Final business and regulatory impact assessment (BRIA) of 2021 has a figure for fraud of £108 million, not £74.3 million. You can find details in Table 2 which can be downloaded here: https://www.gov.scot/publications/deposit-return-scheme-scotland-final-business-regulatory-impact-assessment/ .

There is a duty in the Waste (Scotland) Regulations 2012 for local authorities to provide a collection for glass. The Deposit Return Scheme (DRS) is for single-use drinks containers; local authorities will continue to collect all other glass not captured by DRS.

The Scottish Government does not hold figures relating to the proportion of glass recyclate for non-scheme articles. However, including glass in DRS will bring significant environmental and economic benefits. The inclusion of glass will save over 1.2 megatonnes CO2 equivalent over 25 years and will also reduce the amount of harmful glass litter in our environment. In addition, DRS will significantly increase the quantity and quality of glass recyclate, creating an aggregated and high-quality feedstock for reprocessing. This will include clear glass, which we understand to be in high demand.

As stated in the Final Business Regulatory Impact Assessment, it is anticipated that floor space implications associated with the installation of Reverse Vending Machines (RVM) are likely to be modest. Generally, it is expected that high-volume retailers will choose to introduce RVMs as they will be able to process returns with greater efficiency, while low-volume retailers will choose to operate manual collection and return, as the costs and space requirements of an RVM may be prohibitive.

Whichever method is adopted, retailers will be able to charge a handling fee from the scheme administrator to fully compensate them for the costs involved in the collection, checking and storage of used containers.

Circularity Scotland Ltd, the industry-led Scheme Administrator for Scotland’s Deposit Return Scheme (DRS), is responsible for determining the number and location of counting and sorting centres and the associated staffing requirements.

Under the producer responsibility principle, the costs of these centres will be borne by industry.

The most up to date information available regarding the impact of Scotland’s Deposit Return Scheme on retailers, including information about the use of Reverse Vending Machines (RVMs) can be found in the amended Final Business and Regulatory Impact Assessment (BRIA), which was published on 22 December 2021 and can be downloaded from the Scottish Government’s website here: https://www.gov.scot/publications/deposit-return-scheme-scotland-final-business-regulatory-impact-assessment/ .

Return Point operators are responsible for ensuring that the Reverse Vending Machines (RVM) that they use meet the specifications supplied by the Scheme Administrator, Circularity Scotland Ltd (CSL).

The costs of operating a Return Point, including the RVM, is offset by the Retail Handling Fee paid by CSL to Return Point operators per in-scope container they process.

Public support for Scotland’s Deposit Return Scheme (DRS) is high.

Zero Waste Scotland’s consumer research indicates that 71% of the public support the introduction of DRS.

Kerbside collection remains important since it enables people to recycle non-scheme items. Additionally, DRS will help local authority waste management services to free up capacity to support wider collection services and improve recycling rates on other materials.

Furthermore, DRS will significantly increase the quantity and quality of glass recyclate, creating an aggregated and high-quality feedstock for reprocessing.

We do not believe an enhanced kerbside scheme could deliver the level or rate of improvement that we will see through DRS. Packaging recycling rates have stalled, including for glass, and the current producer responsibility system is not driving improvement.

DRS should deliver an 85% collection rate for glass by the second full year of operation at the latest.