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Why is Scotland's deposit return scheme under fire? Why has Scotland's deposit return scheme been delayed?
(about 2 months later)
Small brewers say the scheme is not yet ready to go liveSmall brewers say the scheme is not yet ready to go live
Scotland is aiming to be the first part of the UK to introduce a deposit return scheme for single-use drinks containers. Ministers claim it would boost recycling - but the plan is controversial, with critics calling for a delay. Controversial plans to introduce a deposit return scheme for single-use drinks containers in Scotland have been delayed.
All three SNP leadership contenders now say it will not go ahead in its present form - Kate Forbes and Ash Regan want it paused, while Humza Yousaf would exempt smaller firms for a year. First Minister Humza Yousaf said the scheme, which was due to be launched in August, would now come into effect in March next year.
Lorna Slater, the Scottish Greens minister leading the scheme, says she is "actively considering" such a grace period for small businesses but has still urged them to sign up ahead of a deadline on Tuesday. The scheme itself is due to go live on 16 August. What do we know about the scheme - and why has it come under fire?
So what do we know about the scheme - and why is it coming under fire?
What is a deposit return scheme?What is a deposit return scheme?
Deposit return schemes are used in many countries across the world to encourage people to recycle drinks containers such as bottles and cans.Deposit return schemes are used in many countries across the world to encourage people to recycle drinks containers such as bottles and cans.
Many older Scots will recall being able to get money back on their "ginger" (fizzy drink) bottles when they were children - and it works in a similar way.Many older Scots will recall being able to get money back on their "ginger" (fizzy drink) bottles when they were children - and it works in a similar way.
Anyone who buys a drink in a certain single-use container is charged a small deposit which is returned to them when they take the bottle or can to a recycling point. Anyone who buys a drink in a certain types of container is charged a small deposit which is returned to them when they take the bottle or can to a recycling point.
The aim is to incentivise recycling but also to reduce litter and help tackle climate change by reducing the amount of material going to landfill. The aim is to incentivise recycling, reduce litter and help tackle climate change by reducing the amount of material going to landfill.
How would it work in practice?How would it work in practice?
Reverse vending machines like this one at Aberdeen Royal Infirmary are already being trialled across Scotland.
A 20p deposit would be added to all single-use drinks containers made of PET plastic, metal or glass. It applies to both alcoholic and soft drinks.A 20p deposit would be added to all single-use drinks containers made of PET plastic, metal or glass. It applies to both alcoholic and soft drinks.
The consumer gets their money back by returning the container to retailers and hospitality premises that sell such single-use products to take away.The consumer gets their money back by returning the container to retailers and hospitality premises that sell such single-use products to take away.
Reverse vending machines like this one at Aberdeen Royal Infirmary are already being trialled across Scotland. Some retailers will accept items being returned over the counter.
Some retailers will accept items over the counter while larger stores, shopping centres and community hubs will operate automated receiving points known as reverse vending machines (RVMs). Larger stores, shopping centres and community hubs will operate automated receiving points known as reverse vending machines (RVMs). These will issue vouchers which can be used to pay for shopping.
Payment may be made in cash over the counter, or via a voucher from an RVM. Vouchers can be used to pay for shopping or you can ask for cash instead. Similar schemes are due to be introduced in England, Wales and Northern Ireland in 2025, although in England the scheme is not expected to include glass bottles.
Who runs the scheme?Who runs the scheme?
Drinks producers and importers are responsible for delivering the scheme but, to help them, a private non-profit company called Circularity Scotland has been created to administer it on their behalf. Drinks producers and importers are responsible for delivering the scheme. To help them, a private non-profit company called Circularity Scotland has been created to administer it on their behalf.
Producers can administer the scheme themselves if they want to but in most cases working with Circularity Scotland is the only practical and cost-effective option. Producers are billed 20p by the administrator for every bottle or can they plan to put on the Scottish market - but they get this back by adding it to the cost of their products.
Retailers also have a key role to play by operating the container return points.
The way the scheme works, in more detail, is that producers are billed 20p by the administrator for every bottle or can they plan to put on the Scottish market - but they get this back by adding it to the cost of their products.
This 20p deposit is passed on down the chain, through wholesalers and retailers - and eventually on to the customer, who gets it back when the item is handed in for recycling.This 20p deposit is passed on down the chain, through wholesalers and retailers - and eventually on to the customer, who gets it back when the item is handed in for recycling.
In addition, producers are charged a small fee by the administrator to help cover the cost of running the service - about 2p per item for plastic or aluminium bottles and 4p per glass bottle.In addition, producers are charged a small fee by the administrator to help cover the cost of running the service - about 2p per item for plastic or aluminium bottles and 4p per glass bottle.
Circularity Scotland will pay retailers a small handling fee for fulfilling their role as return points - roughly 2p or 3p per item depending on the collection method. Circularity Scotland will pay retailers a small handling fee for fulfilling their role as return points - roughly 2p or 3p per item, depending on the collection method.
The retailers pay customers for recycled items out of their own funds, but are reimbursed by the administrator.The retailers pay customers for recycled items out of their own funds, but are reimbursed by the administrator.
The scheme, which covers all drinks producers who sell their products in Scotland, is designed to be largely self-financing. The scheme is designed to be largely self-financing. The Scottish Environment Protection Agency (Sepa) will act as regulator, carrying out inspections to achieve compliance.
The Scottish Environment Protection Agency (Sepa) will act as regulator, carrying out inspections to achieve compliance.
Why are some businesses worried?Why are some businesses worried?
Some businesses fear it will place extra costs and other burdens on them at a time when they are already struggling. Small producers such as The Loch Lomond brewery are worried about the impact of the scheme
Small producers such as craft breweries say they are not against the idea in principle - but warn that the timetable and details of the scheme are problematic. Some firms fear it will place extra costs and other burdens on them at a time when they are already struggling.
Small producers such as craft breweries say they are not against the idea in principle - but warned that the timetable and details of the scheme were problematic.
Producers are being encouraged to label items destined for sale in Scotland with a special Scottish barcode - and if they choose not do this, they face a surcharge of just over 1p per item.Producers are being encouraged to label items destined for sale in Scotland with a special Scottish barcode - and if they choose not do this, they face a surcharge of just over 1p per item.
Smaller firms argue that the cost of adding new barcodes and paying a flat rate £365 registration fee will have a disproportionate impact on them. Smaller firms argue that the cost of adding new barcodes and paying a flat rate £365 registration fee will have a disproportionate impact on them. They had argued for a longer adjustment period.
Some complain they have been given a deadline to sign up to a legally-binding agreement which potentially jeopardises their business - but if they fail to register they risk being barred from selling their goods in Scotland.
Trade bodies say thousands of firms could end up being forced out of the Scottish market, and many products will disappear from the shelves.Trade bodies say thousands of firms could end up being forced out of the Scottish market, and many products will disappear from the shelves.
Small producers such as The Loch Lomond brewery are worried about the impact of the scheme
Retailers can ask for an exemption from providing a collection service - but only if they can demonstrate a nearby collection point is willing to accept material on their behalf, or if collecting material would breach other rules such as fire safety or environmental health.Retailers can ask for an exemption from providing a collection service - but only if they can demonstrate a nearby collection point is willing to accept material on their behalf, or if collecting material would breach other rules such as fire safety or environmental health.
They are also worried they will have to pay higher prices to producers but there will be a delay in recouping that money from customers, hitting their cashflow.They are also worried they will have to pay higher prices to producers but there will be a delay in recouping that money from customers, hitting their cashflow.
Circularity Scotland recently announced £22m of cashflow support to help smaller producers, exempting them from fees and upfront charges for the first month, and offering two months credit terms for payments. Smaller firms can also use stick-on barcodes. Why has the scheme been delayed?
But firms claim they need a longer adjustment period. Jamie Delap, director of the Society of Independent Brewers, told they BBC they had been asking for a grace period for small businesses since October and there was still no clarity over who would be considered a "small" producer. The delay was announced by Humza Yousaf as he set out his priorities for the next three years. It will now be launched on 1 March next year.
"I have to sign this agreement by Tuesday and I still don't even know, even if I do choose to sign it, if I can actually comply with my legal obligations under the agreement. It's kind of crazy," he told BBC Radio's Good Morning Scotland. The first minister said he and Circular Economy Minister Lorna Slater - who had previously voiced confidence that the scheme would launch on time - had heard the concerns over its readiness to be launched this August.
Legal obstacles He said they would work with businesses and Circularity Scotland to address concerns and "ensure a successful launch". A package of measures will also be put in place to "simplify and de-risk" the scheme.
A leading lawyer recently claimed that the Scottish scheme could create an unlawful trade barrier with other parts of the UK, as it would result in different prices being charged either side of the border. Mr Yousaf also said there was "uncertainty" because the UK government had delayed a decision on whether to exclude the scheme from the Internal Market Act.
Aidan O'Neill KC also warned that it may prove impossible to enforce the rules on imported products - which would leave Scotland-based producers at a disadvantage. Scottish Secretary Alister Jack has previously hinted that the UK government might not grant an opt-out.
Scottish Secretary Alister Jack has hinted that the UK government might not grant an opt out from the UK Internal Market Act, which would be a severe blow to the project. In February, lawyer Aidan O'Neill KC claimed that the Scottish scheme could create an unlawful trade barrier with other parts of the UK, as it would result in different prices being charged either side of the border.
Mr Jack cited inflationary concerns, telling MPs the scheme would see the cost of 12 bottles of Scottish water sold in Aldi rise from £1.59 to £3.99.
Similar schemes are due to be introduced in England, Wales and Northern Ireland in 2025 (although in England the scheme is not expected to include glass bottles).
The Scottish government insists it is listening to concerns but some now argue it would be wiser to delay the Scottish scheme once again, allowing more time for preparation and better alignment with the rest of the UK.
Circular Economy Minister Lorna Slater remains confident the scheme will not be paused. She told the BBC's The Sunday Show there was "great momentum" towards the 16 August launch date.
"I did give them a one year delay last year to help them recover from Covid. Industry has invested tens of millions in this, and we are going ahead," she said.
Related TopicsRelated Topics
Scottish governmentScottish government
RecyclingRecycling