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Further support to help drinks businesses with Scotland’s DRS

A £22m package of support has been announced to help Scotland’s brewers, distillers, importers and drinks manufacturers prepare for the deposit return scheme (DRS).

The scheme is causing concerns for industry, MSPs and councils alike. In December, cuts to producer fees for the scheme were announced as well as exemptions for smaller retailers. In January, following consultation with industry and independent analysis by PwC, an increase of up to 19% in the return handling fees for the DRS was confirmed.

Fears remain however that the planned August launch is unachievable. The latest package, announced by scheme administrator Circularity Scotland this week, is supposed to address more of the issues raised by businesses. 

The measures include the removal of day one and month one charges for all producers, up to a threshold of three million units per year. Two-month credit terms on deposits and fees (up to the same volume threshold) will also be provided to reduce the working capital impact on all producers. The changes are designed to help SMEs, in particular, who have voiced concerns over the impact of DRS on cash flow. 

Circularity Scotland also confirmed that it will be offering the option to use self-adhesive barcode labels for producers placing less than 25,000 units per year of a specific product on to the Scottish market. This will provide a “simple and straightforward” administrative solution for independent producers and importers for whom the cost of changing packaging to introduce new barcodes could be prohibitive.

The scheme has been five years in planning but business leaders have called for further delays, also citing the divergent and delayed DRS approaches being implemented across the rest of the UK.

UKHospitality Scotland executive director Leon Thompson said the package is a “desperate attempt” to boost the number of businesses signing up to be involved the scheme.

Registration for producers closes next week but members of UKHospitality Scotland have been reporting that suppliers are highlighting a number of drinks brands and products that will not be available in Scotland after August 16th. “This is bad news for those producers and our businesses who will not be able to offer the same range of drinks to customers,” Thompson said.

It is thought that nearly 4,500 producers need to be registered for DRS by March 1st but as yet there is no indication of how many have done so. Those that don’t register risk being unable to sell their products in Scotland.

Scotland’s scheme applies to soft and alcoholic drinks sold in single-use containers between 50ml and 3 litres and made from PET, plastic, glass, aluminium and steel. People will pay a 20p deposit when they buy a drink in a single-use container made of plastic, metal or glass, which is refunded when the containers are returned. A well-run DRS should provide a guaranteed source of high-quality materials for recycling. The scheme also ensures producers take full financial and environmental responsibility for the proper collection of their packaging.

The UK Government announced in January that it will launch a DRS in October 2025 at the earliest, with the aim of increasing recycling rates of drinks containers to 90% within three years of the scheme commencing. However, the scheme in England is unlike to include glass.

Kim Pratt, circular economy campaigner at Friends of the Earth Scotland warned against further delays.“While it is encouraging that the UK Government has committed to its own scheme, it should not be seeking to slow down environmental progress in the devolved nations. Politicians should be seizing this opportunity to take urgent action to combat waste and move to a more circular economy.”