Chamber and committees

We are analysing the text of the Act to understand how it could interact with Scotland’s Deposit Return Scheme (DRS), but in order to assess impact fully we need to understand the UK Government’s intentions for its own DRS. We have not yet seen their response to their recent consultation.

Section 34 of the Environmental Protection Act 1990 requires those handling waste to ensure that it is handled in a fashion that promotes high-value recycling.

Return points, producers and Circularity Scotland, when handling returned scheme packaging, including glass, will therefore have an obligation to promote high-value recycling regardless of whether the glass is collected manually or by the use of reverse vending machines.

The figure is based on Circularity Scotland Ltd’s assessment of its expected annual turnover as scheme administrator once it is in steady state.

We anticipate that implementation and operation of DRS will generate a range of business and employment opportunities in the extensive infrastructure and logistics required for the scheme, for example in the construction and operating of sorting and bulking centres.

Participation of small producers is vital to the success of the scheme and we believe we have taken their needs into consideration in designing DRS.

We have consulted extensively with businesses of all sizes that will be affected by the implementation of Scotland’s Deposit Return Scheme. We are not aware that any producers have decided to cease doing business in Scotland, although we are aware that some have expressed concerns about whether they will continue to sell their products in Scotland.

This is one of the reasons why we have applied a de minimis for the SEPA registration fee. This will remove a cost for businesses operating below the current VAT threshold, benefiting around 1,600 of the more than 4,000 anticipated producers selling into the Scottish market

The Final business and regulatory impact assessment (BRIA) of 2021 has a figure for fraud of £108 million, not £74.3 million. You can find details in Table 2 which can be downloaded here: https://www.gov.scot/publications/deposit-return-scheme-scotland-final-business-regulatory-impact-assessment/ .

Circularity Scotland Ltd, the industry-led Scheme Administrator for Scotland’s Deposit Return Scheme (DRS), is responsible for determining the number and location of counting and sorting centres and the associated staffing requirements.

Under the producer responsibility principle, the costs of these centres will be borne by industry.

The number of reverse vending machines (RVMs) was based on analysis of data that identified retail locations in Scotland, the store type and the sales area. This estimated that there would be approximately 3,021 automatic return points using RVMs and 14,386 manual return points.

The decision on whether to install a RVM will be for individual retailers to make.

As stated in the Final Business Regulatory Impact Assessment, it is anticipated that floor space implications associated with the installation of Reverse Vending Machines (RVM) are likely to be modest. Generally, it is expected that high-volume retailers will choose to introduce RVMs as they will be able to process returns with greater efficiency, while low-volume retailers will choose to operate manual collection and return, as the costs and space requirements of an RVM may be prohibitive.

Whichever method is adopted, retailers will be able to charge a handling fee from the scheme administrator to fully compensate them for the costs involved in the collection, checking and storage of used containers.

As a private business, the remuneration of Circularity Scotland Ltd staff is not shared with the Scottish Government, nor is it subject to Ministerial approval.

The model used to inform that BRIA deals with local authorities as a collective group and it is therefore not possible to provide detailed calculations for individual local authority costs and benefits in relation to recycling. You can view the full report here: https://www.gov.scot/publications/deposit-return-scheme-scotland-final-business-regulatory-impact-assessment/ .

Landfill tax is considered a ‘transfer payment’ under HM Treasury guidance and is therefore not included in BRIA calculations.