Deposit return scheme Scotland: Lorna Slater confirms DRS plans scrapped in current form

Lorna Slater says it is clear the DRS “cannot go ahead as currently planned”

Business leaders have urged the Scottish Government to learn lessons from the “flawed” roll-out of the deposit return scheme as minister Lorna Slater confirmed the plans had effectively been scrapped in their “current” form.

Ms Slater, the circular economy minister, said the deposit return scheme (DRS) “cannot go ahead as currently planned” after the UK Government refused to change its stance on excluding glass.

She is now seeking an “urgent” meeting with the UK Government to see if a modified DRS can go ahead instead.

Lorna Slater is the minister for green skills, circular economy and biodiversity. Picture: PA

The DRS would see an extra 20p added onto drinks containers, which would be refunded when the container is returned to a retailer or a hospitality venue.

However, Scotland needed an exemption from the UK-wide Internal Market Act before it was able to introduce its own DRS - an exemption the UK Government said would only be granted if the scheme does not include glass.

This led to a constitutional argument, with the SNP-Green coalition accusing the UK Government of undermining devolution before conceding the plans would not go ahead on Tuesday.

Federation of Small Businesses Scotland policy chair Andrew McRae welcomed Ms Slater’s announcement as he said: “This was a well-intentioned, but fundamentally flawed, scheme. As time went on, it became apparent it wasn’t going to work in its current form and was going to damage small producers and retailers on its way down.

Questions remain over the future of Scotland's deposit return scheme.

“The questions we’ve been raising since 2018 about cost, space and time are still the issues troubling small businesses and there didn’t seem to be a clear route to address them.

“While many will feel relieved that this latest uncertainty has now, to an extent, been ended, we now need to get on with developing a system that stands a better chance of working … key to that will be learning the lessons from this episode and bringing the sort of small businesses, on whom government will be relying to deliver any such scheme, in on the ground floor.”

Over the weekend First Minister Humza Yousaf had written to Prime Minister Rishi Sunak asking for the glass exemption to be dropped.

UK ministers have refused to budge on this, and now the Scottish Government says it is looking to modify its original DRS plans instead.

Ms Slater, the Green minister in charge of introducing DRS, said: “Due to the 11th-hour intervention by the UK Government to change the parameters, both to remove glass and to add significant uncertainties around essential parts, it is clear Scotland’s deposit return scheme in the scope and form passed by this Parliament cannot go ahead as currently planned.”

She said Scottish ministers were now “urgently establishing” whether or not it was now possible to have a modified DRS that does not include glass. The minister said this depends on the UK Government providing “timely, stable, reliable assurances” and industry support.

She added: “The UK is not acting with good faith here to support Scotland’s scheme going forward and is, in fact, doing everything possible to undermine it.”

Mr Yousaf had on Monday warned businesses would be put at a competitive disadvantage if glass was not included in the DRS.

This is despite those tasked with operating the DRS in Scotland saying it was possible for the Government to introduce a scheme that does not include glass.

David Harris, chief executive of Circularity Scotland, the administrators of Scotland’s DRS, said: “The Scottish Government has highlighted that the removal of glass from the scheme changes the economic model of the scheme and the breadth of the environmental benefits it will provide.

“However, there would be a risk to jobs and investment if the scheme does not go ahead for cans and plastic, not to mention the ongoing environmental impact we will see from too many of these containers continuing to end up as waste.

“We therefore ask everyone to get behind the scheme.”

Similarly Michael Topham, chief executive of Biffa, the company that will be responsible for collecting the bottles and cans from return points, had earlier written to the First Minister and said: “Whilst the position of the UK Government is no doubt unwelcome for all those committed to delivering the scheme for Scotland in the form originally intended, I strongly believe that the best course of action at this stage is to proceed without further delay, enabling Scotland to deliver this ground-breaking environmental solution as soon as possible and substantially earlier than the rest of the UK.

“Any decision to cancel or significantly delay the scheme beyond March 2024 sends a seismic and detrimental signal to all those businesses that are in principle willing to commit resources into helping the Scottish Government deliver on its ambitions, completely undermining its position as a legislator that can be relied upon.

“In my view, the ramifications of this will be significant.”

Tuesday’s announcement was heavily criticised from the opposition benches within Holyrood.

Liam Kerr, the Scottish Conservatives’ net zero spokesman, said Ms Slater seemed to imply in her statement that Circularity Scotland was wrong to say the scheme could proceed without glass.

He said: “She can’t admit that she and the SNP-Green government produced a scheme that was a shambles, heavily criticised by industry, and that when it fell to pieces, she and the First Minister picked an entirely pointless fight with the UK Government.

“Businesses urgently need certainty on whether this botched scheme is to go ahead and, if it is going ahead, whether she will listen to industry and collaborate and co-operate with the UK Government so that we get a system that works.”

Previously Ms Slater was unable to say whether not businesses which have already invested in getting ready for DRS will be compensated or not.

Earlier in the day, Scottish Labour leader Anas Sarwar said ministers were causing a constitutional argument to distract from their own failings.

He said: “Let’s not avoid the incompetence, let’s be real about this – as much as there might be a disagreement around glass between the Scottish Government and the UK Government, let’s not pretend that’s what the major problem of this scheme is.

“The major problem is SNP incompetence [and] a failure to deliver a scheme that gives confidence to businesses that it will protect jobs.

“Instead, it’s been shambolic from day one and they are now hunting for an excuse to hide their own failures. I think we’re stuck with two incompetent governments.”

Ms Slater, who is due to appear in front of Holyrood’s net zero committee next week, was unable to answer whether or not the scheme is still due to go ahead for a launch date of March 2024.