Extract from Scottish Parliament (Topical Questions): Deposit Return Scheme - Feb 28

2. Maurice Golden (North East Scotland) (Con)

To ask the Scottish Government whether it will provide an update on when the Deposit return scheme will launch. (S6T-01200)

The Minister for Green Skills, Circular Economy and Biodiversity (Lorna Slater)

Scotland’s Deposit return scheme remains on course to launch on 16 August this year.

I continue to urge producers to begin their registration for the scheme if they have not already done so, and to contact Circularity Scotland, which is the scheme administrator, as soon as possible for advice.

The launch of a scheme of this complexity, in which every single person in Scotland will participate, is not easy, but it is significant and transformational. I am grateful to businesses of all sizes, which are continuing to make good progress as they prepare for launch in August this year.

Maurice Golden

However much the minister wants to pretend otherwise, the reality is that a delay is now almost inevitable. The question is whether we take an informed and workable pause to rescue the scheme or wait for the Scottish Government’s staggering level of incompetence to force us into a messy delay. When the deadline for producer registration runs out at midnight, we pass a point of no return. A workable pause then becomes extremely difficult because businesses will be liable for a delay, even though it will be through no fault of their own.

Businesses need urgent reassurance. Can the minister confirm three points? How many producers have signed up? How will she ensure that businesses are not held liable for a delay? Has the application for an internal market exemption been officially submitted?

Lorna Slater

The member is confusing today’s deadline with producers’ liabilities in the scheme, which are two separate matters. Today’s deadline is for producers to register with the scheme, which would go live on 16 August. I think that the member is confusing today’s deadline with liabilities around a delay with that, which might have been discussed in the press.

I confirm that the Scottish Government has been following the agreed process to seek the exclusion of the DRS regulations from the United Kingdom Internal Market Act 2020. That has been the subject of a discussion with the UK Government, which began in 2021, when we sought a broad exclusion under the resources and waste common framework and an exclusion was agreed that covers Scotland’s single-use plastic regulations. We will continue to press the UK Government for a decision as soon as possible, to give businesses the clarity that they need.

Maurice Golden

That was very helpful. It is now on record that the Government’s application has not been submitted and that the minister has guaranteed to any producers out there that the legal agreement that they have signed with Circularity Scotland bears no liability for their business.

This morning, the minister effectively accused hundreds of businesses of having no credibility. More than 500 businesses signed an open letter that called for the scheme to be paused. Members, including me, have also called for a pause. Having spent 10 years in the waste management sector, I will not take any lectures from a minister who is presiding over a car crash. Businesses are staring ruin in the face, while the minister closes her eyes, crosses her fingers and hopes for the best.

With just hours left until registration closes, will the minister see sense and extend registration to avoid catastrophe?

Lorna Slater

The member has misrepresented what I have said with respect to liability in relation to today’s deadline.

The member referred to a letter from producers that is several weeks old. He is correct that we are still working through issues with small producers, but the letter that he referenced predates the significant work that we have done with small producers, including that which was completed last week: we listened to businesses and put in place £22 million of cash-flow support, which is exactly what they were asking for to help them with their day 1 costs. We have put in place a practical labelling solution, which is exactly what small importers were asking for.

We will continue to work with small producers to ensure that they can become fully compliant with the scheme before its 16 August launch.

Christine Grahame (Midlothian South, Tweeddale and Lauderdale) (SNP)

Previously, I raised the concerns of craft breweries, such as Broughton Ales and Traquair House Brewery, as well as those of Dryden Aqua glass recycling company—all in my constituency. Today, I add the concerns of Villeneuve Wines, a wine retailer in Peebles, which is also in my constituency. All those companies are at a loss with regard to the Deposit return scheme—they are confused by it. How flexible will Circularity Scotland be regarding registrations in those circumstances?

Lorna Slater

Circularity Scotland is here to help. Circularity Scotland is the organisation put together by industry. In the past week, MSPs will have received a letter from Circularity Scotland that details how it was created and gives examples of some of the industry players that were involved in that.

Circularity Scotland is there to help businesses to comply with the regulations that were passed by the Scottish Parliament in 2020. If businesses are confused, they need to contact Circularity Scotland to find out how it can help them to comply. I know that every business is different and has its own concerns. I encourage businesses to contact Circularity Scotland, which is here to help them.

Colin Smyth (South Scotland) (Lab)

Last week, Labour proposed a delay in the introduction of the scheme for small producers, which SNP and Green MSPs voted down. However, days later, the minister said that she was actively considering such a delay. When will the minister make a decision on the request for a delay for small businesses? Is it not the case that the minister is losing the confidence of small businesses, has lost the confidence of whoever is going to be the next First Minister and is now losing control of the Deposit return scheme altogether?

Lorna Slater

The member is not being accurate. Some of the contenders for First Minister are absolutely supportive of the Deposit return scheme. The scheme has significant support across the board: it was supported by parties across the chamber and many colleagues have been pushing us to get on with it because of the environmental benefits that it will deliver.

We have been systematically working through the asks from small producers. A couple of weeks ago, the number 1 ask related to cash flow; another related to labelling. We have proposed a solution to those issues. The ask on the table right now relates to a grace period. We are looking at that seriously and considering the implications.

I have been listening all along and we will continue to work with businesses to bring them into compliance with our legislation, as passed by the Parliament in 2020.

Liam McArthur (Orkney Islands) (LD)

The finance secretary, who presumably signed off the proposals at the Cabinet, has suggested that if they are implemented it could lead to “economic carnage”. In light of that complete breakdown in ministerial responsibility and in order to rebuild confidence among the business community, the wider public and even within the SNP-Green coalition, will the minister agree to pause the scheme, undertake a review and ensure that the proposals in Scotland command confidence and can be as successful as the approach that we have seen in countries around Europe?

Lorna Slater

Implementing successful Deposit return schemes has been a challenge around the world. Before such schemes are implemented, they look challenging and people have to make adjustments, but after they are in place, matters are well understood.

The situation today is that hundreds of millions of pounds have been invested by Scottish businesses for the launch of this programme. More than 500 jobs have been recruited or are in the process of being recruited. The sorting centre sites have been set up, and the trucks to do the reverse logistics have been ordered. That is all in place as we move towards the 16 August deadline.

The businesses that have made that substantial investment of hundreds of millions of pounds and created those jobs will get their return on investment only when the scheme launches. They are counting on us to do our part to launch the scheme on 16 August, so my role is to make sure that all businesses in Scotland are able to become compliant and participate in the scheme in a pragmatic and practical way, and that is what we are doing.

The issue on the table is not the launch date of the scheme—it will launch on 16 August; the issue on the table is how we support all businesses in Scotland, especially our small businesses, to fully participate in the system and therefore gain the benefits of it.

Mark Ruskell (Mid Scotland and Fife) (Green)

What impact will the continued uncertainty that is being presented by the failure of the United Kingdom Government to issue a United Kingdom Internal Market Act 2020 exclusion have on the Deposit returnscheme?

Lorna Slater

There is an agreed process between the UK Government and the devolved Governments for excluding certain areas from the internal market act. We first raised the need for an exclusion in 2021, and since then, there has been constructive engagement between the Scottish and UK Governments on the issue.

The Deputy First Minister, concerned by the time taken to reach an exclusion, wrote on 31 January to the chancellor and the Secretary of State for Levelling Up, Housing and Communities about the need for a UK Government decision on the application of VAT, which we have thankfully now had, and an internal market act exclusion. We need the UK Government to issue that exclusion for Scotland’s Deposit return scheme from the internal market act. Given that these are longstanding plans that will make an important contribution to our climate change and recycling targets and will give businesses the clarity that they need, I expect a decision from the UK Government on the matter as soon as possible.

Daniel Johnson (Edinburgh Southern) (Lab)

Today we hear from Lorna Slater that the scheme is all on track, yesterday we heard from Humza Yousaf that there needs to be a pause, and Kate Forbes says that there will be “carnage”—three different ministers with three different positions on DRS. Can the minister confirm that section 2 of the ministerial code has been suspended with regard to DRS?

Lorna Slater

The member is not accurate in what he says about what Humza Yousaf said. Humza Yousaf mentioned the grace period that small producers have requested, and as I said to Colin Smyth, that is a matter for discussion and consideration, because I want to do everything that we can to help small producers to engage with the scheme. We are working with industry to launch the scheme on 16 August this year.

Kaukab Stewart (Glasgow Kelvin) (SNP)

Kat Jones, director of the Association for the Protection of Rural Scotland, has said:

“We are in the middle of a climate crisis, with litter plaguing our towns and countryside. The price of any further delay or weakening of the”

Deposit return scheme

“system would be frankly unbearable.”

Does the minister agree?

Lorna Slater

Yes, of course; we have to take bold and ambitious action now to tackle the climate emergency. Our Deposit return scheme will launch in August and be a major part of our efforts to reduce littering, cut emissions and build a more circular economy. Our scheme will reduce littering by a third and increase recycling rates of single-use drinks containers towards 90 per cent. The scheme will reduce CO₂ emissions by 4 million tonnes over 25 years, which is the equivalent of taking 83,000 cars off the road.

Government officials, Circularity Scotland and I continue to meet regularly with industry to ensure a pragmatic approach to the implementation of DRS.

The Presiding Officer

That concludes topical questions.