End of business adjournment debate on Deposit Return Scheme - May 26

Mr Philip Hollobone (Kettering) (Con)
Thank you very much indeed, Mr Deputy Speaker. What a pleasure it is to see you in the Chair. I should also like to thank Mr Speaker for granting me permission for this debate, and to welcome the Under-Secretary of State for Environment, Food and Rural Affairs, my hon. Friend the Member for Bury St Edmunds (Jo Churchill), to her place on the Front Bench.

The issue before us today is Her Majesty’s Government’s proposed deposit return scheme for drinks containers, whereby consumers will pay a small levy upon purchasing a drink, which is then refunded once the container is returned to a collection point. Specifically, I wish to raise my serious concern that glass bottles are to be excluded from the scheme. The omission of glass represents a real and serious threat to the effectiveness with which a deposit return scheme in England and Northern Ireland can realistically be delivered. Quite simply, its exclusion would be a catastrophe for our natural spaces as we all look to stem the tide of drink container pollution. It also represents the direct betrayal of a promise made by the Conservative party to voters at the last general election, when we said in the manifesto that we would introduce a deposit return scheme for both plastic and glass drinks containers. I wish to use this debate today to urge Her Majesty’s Government to rectify this as a matter of urgency and to immediately revisit the scheme’s design so as to include drinks containers made from glass.

In 2019, the Conservative party laid out its ambitions for the future of our country in its election-winning manifesto, which attracted 60% support in the Kettering constituency. Central to our aspirations was positioning Britain as a world leader in rising to the environmental challenges that are facing our planet today. One of the challenges identified was how we manage and process waste, and in particular, combating the growing problem of discarded waste, of which drinks containers are a large part. In that manifesto, the Conservative party outlined plans for a world-class deposit return scheme for drinks containers in a bid to minimise their impact on the environment. The manifesto said:

“We will crack down on the waste and carelessness that destroys our natural environment and kills marine life. We will introduce a deposit return scheme to incentivise people to recycle plastic and glass.”

Jim Shannon (Strangford) (DUP)
Will the hon. Gentleman give way?

Mr Hollobone
I would be honoured and delighted.

Jim Shannon
I congratulate the hon. Gentleman on bringing forward this debate. In my council area of Ards and North Down, the council has a strategy and a plan of action for recycling. It includes many kinds of recycling and it tries not to leave anyone out of any part of it. The hon. Gentleman is saying that glass needs to be part of that programme, and that that needs to be a commitment. In my council area, each household has a glass return system and a plastic basin to put the glass into. They can also go to recycling centres, which are probably no further than three miles from any person. Those are examples of what we are doing in Northern Ireland, where there is a clear commitment, a strategy and a plan through the council, and across the Northern Ireland Assembly as well. Would he like to see more of those kinds of strategies?

Mr Hollobone
I thank the hon. Gentleman for his helpful and interesting intervention, and I commend his local council for its recycling efforts. There are similar schemes across the four nations, but as I will come on to later in my remarks, the problem with leaving glass out of the deposit return scheme is that it will be a missed opportunity to increase overall glass recycling rates to the best international standards. At the moment, my understanding is that the Government’s proposal for the deposit return scheme in England and Northern Ireland will be different from the deposit return schemes in Scotland and Wales, which will include glass. One of the difficulties is that there will be different deposit return schemes in different parts of the United Kingdom.

Jim Shannon
Again, to illustrate the point and support what the hon. Gentleman is saying, the recycling schemes in our council area have, in a way, reached their peak. That is a problem. I think he is referring to something that I would fully support—I know the Minister will give her comments on the matter later—which is some way of raising awareness of the fact that there would be a reimbursement advantage for people who are prepared to recycle their glass. In anticipation of what the Minister will say, I will take a copy of the Hansard report of this debate and make sure that I show it to the relevant Minister at the Northern Ireland Assembly so that they can do the very same.

Mr Hollobone
As usual across so many issues, the hon. Gentleman and I are on the same page. My contention is that the United Kingdom will not be able to achieve the best international glass recycling levels unless glass is included in the deposit return scheme.

As Conservatives, we made a vow to voters to introduce a scheme that serves the public and Britain’s precious natural habitats. However, Her Majesty’s Government have so far committed to introducing, by 2024, a deposit return scheme across England and Northern Ireland inclusive of only plastic bottles and aluminium cans. Glass is a glaring omission.

A huge 86% of respondents to the Government’s first consultation on the deposit return scheme said they want glass to be included but, despite this overwhelming majority support from technical experts, charities, scientists and the great British public, calls for glass to be included have been ignored.

The scheme’s current design falls well short of what was promised and will see it fail to achieve what is required. A deposit return scheme that excludes glass runs the risk of being a global embarrassment for a country that seeks to position itself as leading from the front on environmental issues. In its current form, the scheme’s design will fail to crack down on glass waste and will miss a wonderful opportunity to protect our natural environments from glass pollution.

The case has been made that including glass is problematic. However, this case has been made by glass industry lobbyists who have a vested interest in ensuring glass containers are not included in such a scheme. One such argument is that glass, once collected, can be hazardous and dangerous for those charged with sorting it for recycling when it becomes broken. This works both ways, as it can also be argued that glass poses a greater risk to the public and pet owners when it breaks down in nature rather than in the controlled environment of recycling plants.

The lack of a deposit return scheme for glass containers poses a very real risk that such containers will continue to end up on our pavements and in our parks and outdoor spaces, where they will be a health and safety risk to UK residents. This public safety danger is unmatched by other containers. In that regard, the scheme’s current proposal fails to protect both the environment and the British public.

Additionally, glass industry lobbyists have suggested that the inclusion of glass will drive consumers towards purchasing highly polluting plastic bottles. However, with the public already widely aware of the prevalence and environmental impact of plastic pollution, I contend that these claims are speculative at best. If we are to tackle the waste crisis, we must trust consumers to do the right thing, but it is vital that we arm them with the tools to do so.

British Glass responded to the Government’s consultation, which closed on 4 June 2021, citing various concerns that have little foundation, one of which is that the inclusion of glass would have a detrimental impact on closed-loop glass recycling, despite the industry’s present inability to increase glass recycling rates. Indeed, British Glass explained in its response how the industry is committed to a 90% collected for recycling rate, and to an 80% remelt target by 2030 that would see 80% of all glass recycled back into new bottles and jars, but the stark reality is that this goal will almost certainly never be realised.

By global standards, the UK lags well behind its international counterparts in the collection and recycling of glass bottles, sitting behind countries such as Ireland, France, Spain, Italy, Belgium and Bulgaria. In 2020, the UK’s glass collection rate for recycling stood at just 76%, well below Italy, which boasts a recycling rate for glass bottles of 87%. Meanwhile, across the UK, it is estimated that 5 billion glass bottles are used each year. Under current recycling rates, this means some 1.2 billion glass bottles each and every year are destined to litter our environment or to languish in landfill.

Current systems to raise our collection and recycling rates are lacking. Much of the glass collected across the UK is not suitable for closed-loop recycling, where discarded bottles are turned back into new ones. That is due to the current collection process, which often sees the mixing of different colours and crushing during transportation. However, a well-thought-out, properly prepared deposit return scheme can address these issues with separated collection methods, which will make closed-loop recycling far more viable. That should be considered as a point of urgency, as it is estimated that a well-designed scheme for the UK could improve recycling rates for bottles and cans to more than 90%. At the same time as the Government are also presently consulting on the consistency of kerbside collections in England, with the laudable aim of reducing confusion, through their DRS plans they are paving the way for potentially four different deposit systems to be in place in the UK. Potential confusion among consumers caused by the current design is likely to undermine the effectiveness of England and Northern Ireland’s scheme. Both Scotland and Wales are set to see glass included in their schemes, but a lack of consistency across the UK as a whole, where consumers cross borders routinely, could see us fail to raise glass recycling rates to the levels they need to be, because consumers will not know when and where glass containers can be disposed of. The DRS for drinks containers should be designed with a view to avoiding this confusion and instead empowering the public to do the right thing.

British consumers are overwhelmingly in favour of a scheme that includes all beverage materials and are opposed to the exclusion of glass bottles. A Populus poll commissioned in 2020 by environmental organisation Nature 2030 found some 84% of Britons want all beverage containers to be included in the Government’s proposed scheme. That polling was welcomed by campaigners and academics, who outlined how a comprehensive deposit return scheme will give us the best chance to combat litter. What is vital, and something the Government must not ignore, is that the UK is not walking into unproven territory as it looks to deliver its own scheme; a host of countries have already implemented successful and highly efficient deposit return schemes inclusive of all materials. Those have been proven to dramatically increase collection and recycling rates, and can be used as a powerful template for Britain to follow in implementing its own scheme. Crucially, due to their success, those other international schemes prove that the issues raised by the glass industry lobbyists here are unfounded. Indeed, all-inclusive schemes are common across the world. From more than 40 such schemes globally, only three do not include glass bottles and they exclude glass because they already have in place a returnable system specifically for glass bottles, something that the UK currently lacks. Australia implements a deposit return scheme that also covers beverage cartons, while Canada’s scheme includes cartons, bags in boxes, and plastic pouches. Finland and Denmark, which are considered to implement world-class return schemes, enjoy incredibly high return rates of 94% and 92% respectively. These successes are widely regarded as being due to their systems being inclusive of all materials, with the simplicity of the system being crucial to achieving the public support needed for these schemes to be a success.

In my view, it makes little sense to deviate from such successful schemes, and even less sense when Scotland and Wales are looking to mirror the international successes. For example, Scotland is set to introduce a scheme that includes glass bottles by August 2023, while Wales is set to introduce a scheme that includes glass by 2024. It is vital to ensure interoperability among the schemes and to help consumers to adopt consistent and responsible behaviour across the four nations of the UK. Not only is the Government’s derisory decision to omit glass seeing us fail to be a world leader on the waste crisis on a global scale, but we are falling well behind Scotland and Wales.

In an open letter, some 25 experts in the field recently urged the Government to introduce a deposit return scheme for drinks containers that mirrors Denmark’s system. Cross-party politicians, non-governmental organisations and academics are calling for the Government’s scheme to include all materials, including glass, plastic and aluminium. Denmark has a track record of fine-tuning its own scheme to be as effective as possible. It is a ready-made road map that the UK could follow and would help us to avoid the potential pitfalls that we may encounter along the way if we follow our own bespoke path.

I also wish to raise the issue of VAT. The Government currently plan to apply VAT to deposit return scheme deposits on top of the VAT already charged on the drink. The current expectation is that, if there were a 20p charge, it will be gross of VAT—that is, 17p plus 3p—which means that, if the customer does not return the drinks container that they buy, the producer will receive only 17p back instead of the full 20p. The Government will take the remaining 3p in VAT. If we factor in the estimated 28 billion containers on the UK market, that could mean as much as £185 million lost from the scheme through unredeemed deposits—assuming an 80% return rate—in the first year alone. That would create a situation in which the Government in effect end up profiting from the failure of their own deposit return scheme. What is more, adding VAT to the deposit fee effectively imposes a stealth tax on drinks producers, backing the industry into a corner and creating the real scenario of price rises for the products in question.

If the Government are serious about introducing a scheme, they need to avoid the noise from glass-industry lobbyists and deliver a scheme that works for the environment. Pandering to industry calls makes little sense in the face of overwhelming public support for glass to be included. Furthermore, there is a health and safety risk. Glass is a high-carbon, highly polluting material that presents a real hazard to the public once it is discarded in public places. We should look to create a scheme that drives up the collection and processing of such material, rather than one that makes closed-loop glass recycling more unattainable.

In conclusion, the omission of glass from the Government’s deposit return scheme represents a real and serious threat to the effectiveness with which a deposit return scheme in England and Northern Ireland can realistically be delivered. Quite simply, its exclusion would be a potential catastrophe for our natural spaces as we all look to stem the tide of drink-container pollution. It also represents a direct betrayal of a promise made by the Conservative party to voters at the most recent general election, when we said in our manifesto that we would introduce a deposit return scheme for both plastic and glass drink containers. I urge Her Majesty’s Government to rectify the situation as a matter of urgency and immediately revisit the design of their scheme so as to include drinks containers made from glass.

16:33:00

The Parliamentary Under-Secretary of State for Environment, Food and Rural Affairs (Jo Churchill)
If you will indulge me, Mr Deputy Speaker, on the day of the Humble Address to Her Majesty, I wish to add my voice and those of the constituents of Bury St Edmunds to the voices of others in this place who have expressed their deep appreciation of and thanks for Her Majesty’s dedication, kindness, good humour and service to our nation. She has visited our great county on many occasions and I know that we will celebrate, as the rest of the country will, with bunting and fanfare over the coming week. I am looking forward to judging a fancy dress competition in one of my lovely villages.

As a long-term advocate for our natural environment, Her Majesty, I am sure, would be extremely interested in the important subject that we are discussing today. On that note, I thank my hon. Friend the Member for Kettering (Mr Hollobone) for securing this debate and for the opportunity to discuss the Government’s plans for introducing a deposit return scheme for drinks containers.

As I am sure my hon. Friend is aware, there is an awful lot going on in this space, driven by our resources and waste strategy and the powers that we took in the Environment Act 2021, which was passed last November. With that in mind, we are proud to be driving forward work across the collection and packaging reforms, which is made up of the deposit return scheme, the extended producer responsibility for packaging and the increased consistency in recycling collections in England to which he referred.

The DRS is pivotal to this Government’s commitment to increasing recycling rates. However, we should not overlook that it will provide other benefits. In particular, it will deliver high-quality recyclate for recycling; enable the drinks industry to close the loop on its packaging; help move the UK towards the circular economy, where resources are kept in use longer and waste is minimised, taking us away from that linear throwaway society; deter the littering of in-scope containers; reduce the associated damage to wildlife and habitats; and therefore promote pro-environmental consumer behaviours, with potential knock-on effects on other positive environmental activities.

My hon. Friend has raised some important concerns on behalf of the industry. I want to be clear that our ambition is to introduce a deposit return scheme that works for everyone—for the consumer and across the industries. I know that, in many of our households, across the UK, drinks packaged in metal cans are drunk regularly. For that reason, we all recognise that those cans—light, sturdy, and convenient for storage and transport—have intrinsic qualities that will always make them desirable to consumers and the product of choice. We are of course mindful that any cost to people’s purses, or businesses is particularly tough in the current environment, but we do want to introduce policies that encourage recycling and reduce the amount of litter that blights our environment.

Although DRS is a complex policy to introduce, requiring the efforts of multiple industries, in one way, we are lucky. As my hon. Friend said, there are 40 other deposit return schemes out there, in other nations, from which we can learn. Not only are we drawing on the experiences of the roll-out of DRS in Scotland to inform implementation and planning, but I had the pleasure of meeting the Environment Minister from Lithuania, where a scheme was also recently introduced. I have plans to visit Norway shortly to find out more about its deposit return scheme. Norway has not included glass in its scheme, and nor have the Netherlands or Sweden. I note that the hon. Member for Strangford (Jim Shannon) is no longer in his place, but I understand that southern Ireland, in its plans for a scheme, is contemplating excluding glass. There is, therefore, a mixture of schemes out there.

I recognise that there are deposit return schemes with different scope across the United Kingdom, given that glass is excluded in England and Northern Ireland, but we remain totally committed to working with the devolved Administrations to ensure that there is a completely coherent, interoperable system across the UK.

Excluding glass offers us an opportunity to look at how we incentivise reusable schemes for glass. Those containers that are not within the deposit return scheme are within the extended producer responsibility scheme, so exclusion does not in any way mean that we are not making policy to improve the reuse, recycling and resource efficiency of those things. On the question of VAT, as my hon. Friend would expect, we are in discussion with Her Majesty’s Treasury. I have met the Financial Secretary on this matter in the recent past, as has the Secretary of State.

Ultimately, DEFRA’s ambitious collections and packaging reform agenda cannot be delivered by Government alone. The deposit return scheme will be an industry-led scheme. For that reason we, alongside colleagues in the devolved Administrations, continue to work closely with all relevant sectors to implement a scheme that is as coherent and aligned as we can make it.

I take this opportunity to thank all those who have fed into the consultations, and those who continue to be generous with their insights and expertise into what is positive about schemes they run and where they think we can improve. That will ensure that we deliver a successful deposit return scheme in England.

Mr Deputy Speaker (Mr Nigel Evans)
Before I put the Question, on behalf of the Speaker and the Deputy Speaker team, I wish everybody working at the Palace of Westminster a most glorious, historic platinum jubilee four-day celebration next week.

Question put and agreed to.