Chamber and committees

In March, the gateway review identified that the lack of a decision on an IMA exclusion was a significant blocker to progress, as was the lack of a ruling by trading standards on shelf-edge labelling. Now, of course, as we have seen, the IMA exclusion risk that was identified has materialised, so we are working on the next steps.

Before recess is the intention. In the past three weeks, as Monica Lennon will recognise, there have been substantial changes to the scope of the scheme, so, in order to be able to respond to that gateway review in the context of the work that we are currently doing to take things forward and the situation in which we find ourselves—we made the announcements only last week—we are updating our response to that review and we will publish that response before the recess.

The Scottish Government takes many types of advice, and it has received legal advice on matters relating to DRS on an on-going basis, as appropriate. The member will appreciate that what has happened during the past two weeks happened very quickly and that there was a very short time from when that letter was received and reaffirmed on 5 June, to when I made the announcement to the Parliament. However, within that time, the First Minister and I met with businesses to understand how they felt that we should react to the development.

That is an interesting question. The UK Government has not done any analysis or impact assessment of its decision to grant a partial exclusion. The UK Government asked the Scottish Government to provide additional impact assessments over and above what is required by the common frameworks. In the interest of supporting our DRS, we provided all the additional documentation and analysis that were requested. What came back to us was the partial temporary exclusion, with no analysis of the impact of that and no understanding of the justification or proportionality.

Nothing has been explained to us by the UK Government, so I genuinely do not know its intentions. I do not know whether the UK Government intends—as I would advise it to do—to take on board the years of work that we and Circularity Scotland have done with industry to put together a workable scheme, or whether it intends to develop something entirely independently and then impose that on the devolved nations.

Absolutely. There are three areas in particular that mean that the decision to delay beyond 1 March was necessary. The first is the matter of the deposit. Scotland’s deposit return scheme was based on a deposit of 20p. One of the conditions placed on us by the partial and temporary exclusion from the internal market act 2020 is that the deposit level must align with the UK, but the UK Government has not introduced its regulations yet, so we do not know whether it will set its deposit at 10p, 25p or 30p. A deposit return scheme in which we do not know the level of the deposit is clearly undeliverable.

Another matter is the sizing of containers that are within scope. For example, in Scotland’s scheme, the change in container size that the committee is considering today will change the minimum container size to 100ml. However, we know that other parts of the UK, such as Northern Ireland, are considering a minimum size of 150ml. If we do not know what materials are included in the scheme, how can we programme reverse vending machines to accept the materials, and how can we tell businesses that they have to charge a deposit on those materials? That is completely unknown. How can we implement a deposit return scheme if we do not know to which materials a deposit might apply?

The final issue, which is critical and means that the March 2024 launch is impossible, is around labelling requirements. The Scottish deposit return scheme does not include, through legislation, any requirements on labelling, barcoding et cetera, because those matters are not devolved. However, the UK scheme might include that, as the UK Government has powers in those areas. From speaking with businesses and working with them over many years, I know that, particularly for small businesses, they need at least a year to update their labelling and so on, because of the timeline for getting designs ordered and produced. That means that, if the UK Government included regulations on labelling, as it says that it might, and that was to happen, say, in autumn this year, that would in no way give businesses time to get their labelling right before a 1 March 2024 launch.

Those are the three concrete reasons why it is absolutely impossible for us to launch with the conditions imposed as they are.

We do not believe that any action that we have been required to take gives rise to any obligation for us to pay compensation.

As the member will well know, glass is one of the three main materials used to make single-use drinks containers and it accounts for more than a quarter of all containers that were to be included in our deposit return scheme launching in March.

To put that into context, the Scottish deposit return scheme would include up to 600 million glass bottles, which is about the number that reach the Scottish market every year. Our strategic environmental impact assessment addendum, which was published in December 2021, shows that returning glass will account for 1.3 megatonnes of carbon dioxide savings over 25 years, which is almost 32 per cent of the total carbon savings of the scheme. Without glass in the scheme, we would lose one of its substantial benefits, which is the reduction of our carbon emissions. Our route to net zero is, of course, to reduce those emissions to net zero and removing glass from the scheme makes that much more challenging for us to reach. Glass is also one of our most problematic litter materials. Broken glass in our streets and parks and so on causes a health and safety hazard for children, pets and anyone who has to handle it to clean it up.

CSL has been funded and must work with its members and producers to decide on the future of the company.

That is certainly a very good question, and I intend for exactly that to be on the agenda for my discussion with Minister Pow tomorrow. I intend to highlight the level of expertise and the level of industry connection that has been created, as well as all the infrastructure that CSL has created, such as how to write a producer contract, how to calculate fees and how to do business modelling. For example, it has done extensive modelling on its logistics network to figure out how to collect materials and bring them back to sorting centres, including from islands and remote communities.

All that extensive work is baked into CSL and its contract with Biffa. I will absolutely recommend that the UK Government takes on board that expertise in my conversation with Minister Pow tomorrow. That expertise could be supported going forward so that it could be brought into the UK’s DMO and the work would not have to be redone or the investment remade. The investment that CSL and businesses have made here could then be of benefit to the entire UK.

The Welsh Government participates in our weekly intergovernmental meeting of the four nations. From the most recent meeting, I would say that the Welsh Government is incensed at that interference. Because the Welsh Government is at a different stage, it has not passed its regulations yet, but it was fully intending to include glass in its scheme. It had understood, as we had, from the consultation response that the UK Government published in January, which clearly stated that it was a matter for devolved Governments to decide, that it would be able to go ahead with including glass. However, the internal market act applies to Wales, too, so it is likely to see the same level of interference that we have seen. Yes—it is incensed about the matter.