Extracts from Scottish Parliament: Questions to the First Minister - Feb 9

Extract from questions to the First Minister - Alcohol Advertising (Hospitality and Tourism)

Craig Hoy (South Scotland) (Con)

Will the First Minister join me in congratulating East Lothian publican Patrick Cairney, who has recently stepped in to prevent two local pubs—the Prestoungrange Gothenburg in Prestonpans and the Tower Inn in Tranent—from closing permanently? Does she recognise that hundreds of pubs around Scotland are likely to close their doors for good this winter?

To prevent last orders from being called across Scotland’s hospitality sector, will the First Minister remove pubs, restaurants and cafes from the chaotic Deposit return scheme, replicate the UK Government’s 75 per cent rates relief for hospitality businesses and halt the alcohol advertising and sponsorship review, which will inevitably put further pressure on Scotland’s hard-pressed publicans?

The First Minister

I echo the congratulations that Craig Hoy extended. Like many businesses, pubs are struggling right now with high inflation and high energy costs. We will come shortly to a question about DRS, so I will save my substantive comments on it for that question.

Such businesses benefit from the Scottish Government’s approach to business rates. We have the most competitive business rates regime, including reliefs for businesses from business rates, of any country in the UK. We will continue to do everything that we can to support businesses in these very difficult times. Much of that is down to economic mismanagement by the Conservative Government at Westminster.

Deposit return Scheme (Impact on Drinks Producers)

4. Fergus Ewing (Inverness and Nairn) (SNP)

To ask the First Minister what the Scottish Government’s response is to reports that 600 drinks producers are concerned about the impact on their businesses, and the survival of them, in relation to the Deposit return scheme. (S6F-01796)

The First Minister (Nicola Sturgeon)

We will continue to listen to and, where possible, address concerns that have been raised. In direct response to industry feedback, the Scottish Government has worked with Circularity Scotland—the scheme administrator—to reduce costs to producers, including a reduction in producer fees of up to 40 per cent and a two-thirds reduction in day 1 payments for producers that use United Kingdom-wide barcodes. We continue to work with industry to ensure pragmatic approaches to implementation and we will do so right up to the point of implementation.

Fergus Ewing

Many of the 600 businesses that I referred to are in a state of fear and even despair. Some will close, some will fail and others will no longer sell their produce in their own country of Scotland. Unless it is halted now, the scheme—most businesses believe it to be fatally flawed—will damage Scotland’s reputation as a place to do business. Will the First Minister therefore instruct a pause of this disaster of a scheme before it becomes a catastrophe, and will she order a thorough and independent review of how better to achieve its aims and exclude glass from the scope, as the top six nations in the world on glass recycling have done?

The First Minister

We will continue to listen to and engage with businesses. It is important to say that the steps that we have already taken, which I have set out, demonstrate that. In fact, Scotland Food & Drink recognised that approach when it said in recent weeks:

“These changes mean that some of our key requests have been accommodated, which is positive and means our collective effort has materially improved the implications ... for many businesses.”

Forty-four countries and territories operate Deposit return schemes, and only four of them do not include glass. It is, of course, the case that there are strong environmental reasons for including glass. However, on all these issues, we will continue to listen. One of the issues that I am particularly concerned to consider further is whether there is yet more that we can do to reduce any impact on small producers, because some of the concerns that have been raised there are not unreasonable.

We will continue to take a responsible approach, listen to the concerns of business, and respond responsibly in the face of those.

Maurice Golden (North East Scotland) (Con)

Drinks producers have until the end of this month to sign up for the Deposit return scheme. Those who do so will be financially liable for any delays and will have to fork out up to £1.5 million per month. To make matters worse, they are being asked to sign up with key information still missing. If they do not sign up, they cannot sell their products. One leading Scottish brewer described that as “extortion tactics”. Does the First Minister agree that the deadline for such registration should be extended until the full operational, commercial and financial implications of the scheme are provided?

The First Minister

I am struck by the fact that, when we announced an extension to the go-live date for the scheme back in December 2021, I think, to give industry additional time to prepare, that was criticised at the time by the Conservatives among others in the chamber.

The regulations require producers to register ahead of the launch. Registration is now open. However, we continue to work—this is important—with Circularity Scotland and businesses as they finalise their operational delivery plans. The scheme is industry led, and the industry needs to work with the scheme administrator on a joined-up approach to delivering it.

We have already made changes, which I have set out. We will continue to engage with businesses on any further changes that can sensibly be made to take account of some of the issues that they raise.