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Deposit Return Scheme (Craft Brewers)

– in the Scottish Parliament on 12th November 2019.

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Photo of Jackie Baillie Jackie Baillie Labour

1. To ask the Scottish Government what discussions it has had with craft brewers about the deposit return scheme. (S5T-01877)

Photo of Roseanna Cunningham Roseanna Cunningham Scottish National Party

Scottish Government officials have met representatives of the Society of Independent Brewers—SIBA—and the Brewers Association of Scotland to discuss the deposit return scheme. SIBA also sits on working groups discussing producer and scheme administrator issues. Zero Waste Scotland hosted a workshop for small brewers on 25 September and has continued engagement with the sector, including publishing a sector briefing for small producers. We are securing further dates in the diary to continue engagement.

Photo of Jackie Baillie Jackie Baillie Labour

I had the pleasure of spending yesterday morning with the Loch Lomond Brewery discussing the deposit return scheme—there was no drink taken. The brewery is in favour of the principle of the scheme and fully supports recycling efforts. Its concerns are about the operation of the scheme in practice. Those concerns are widely shared by other craft brewers, the glass industry and the whisky industry. Indeed, about two thirds of submissions on the matter raised substantive concerns.

Loch Lomond Brewery tells me that a barcode for Scotland will cost hundreds of pounds, that it will need separate labels for bottles sold in Scotland and bottles sold elsewhere and that it will have to spend hundreds of pounds incorporating barcodes for each label and thousands of pounds on new machines to collect recycled bottles. Many of its products are purchased in Scotland and taken abroad, so there is no chance of the bottles being recycled again in Scotland. Such small craft brewers operating on small margins have real concerns about the impact of the deposit return scheme for glass. They would prefer to proceed on a United Kingdom-wide basis. Will the cabinet secretary, rather than her officials, meet craft brewers and their representatives to address their concerns before passing regulations?

Photo of Roseanna Cunningham Roseanna Cunningham Scottish National Party

As I indicated, officials are looking at potential dates for meetings. To respond to some of what Jackie Baillie raised, the Deposit and Return Scheme for Scotland Regulations 2020 do not create a requirement for separate Scottish labelling and will therefore not mandate a separate stock-keeping unit for producers. Some of the issues around this perhaps arise from a misunderstanding. That is one reason why we want to ensure that the scheme, when it is up and running, is industry led: it is not something designed by us; we want industry to design and run it. The Norwegian example is the one that we are most attracted by. These issues—they are real issues and I understand and hear them—are matters for the scheme administrator to consider. I strongly encourage all small retailers, regardless of what part of the business they are in, to be very involved in the work that is being done to take the whole issue forward. This deposit return scheme will significantly increase the quantity and quality of recycled glass that is available for reprocessing, as well as doing really good work in significantly reducing the amount of plastic that gets into our environment.

Photo of Jackie Baillie Jackie Baillie Labour

I thank the cabinet secretary for her further very welcome response. There is a real issue about the quality of recycling. We know that we get most recycling of white glass, less of green glass and nothing really of brown glass. Most drink bottles are typically green and brown glass. There is also concern that we have not maximised glass collection using existing means. For example, many local authorities, including my own, do not do doorstep glass recycling, and we feel they should be encouraged to do so. I am delighted that the cabinet secretary mentioned that this scheme should be industry designed and run, because I think that is at the heart of the issue. The key issue for me is that we involve the industry now, before the regulations are passed, given its concerns and given the misunderstanding over glass recycling. Will the cabinet secretary consider introducing the deposit return scheme in two phases? The first could deal with plastics and cans and the second could introduce glass. That would allow an opportunity for those really important discussions with the industry.

Photo of Roseanna Cunningham Roseanna Cunningham Scottish National Party

I hear what Jackie Baillie is asking, but one of the difficulties with this is that if we introduce a scheme that excludes glass at the start, it is prohibitively expensive and it is almost impossible to retroactively add glass to the collection process. I am happy to engage directly with her on that. Our current best available evidence on the recycling rate for glass is that it sits at around 64 per cent. All the evidence we have suggests that the countries whose deposit return schemes include glass are getting a recycling rate in excess of 85 per cent, so we are looking at a fairly significant uptick in the amount of glass that can be recycled through such a scheme.

As I said at the beginning of this process, plastics are easily understood and it is easy to change to a deposit return scheme on plastics. I accepted that there are slightly greater issues attached to glass, but it is also one of the most popular materials among the public to be included in this. Some 85 per cent of people surveyed want glass to be included and one of the reasons for that, of course, is the very antisocial element that glass creates when it is left lying about.

I am very happy to engage further on that. In my initial answer, I indicated that there are organisations that sit on two separate working groups, and the Federation of Small Businesses sits on the implementation advisory group. I would therefore hope that everybody who is involved in particular parts of the sector is making sure that their views are being fed through their organisations to the implementation advisory group, because it is the group that will come up with the industry-run scheme.

Photo of Maurice Golden Maurice Golden Conservative

I refer members to my entry in the register of interests.

I welcome the cabinet secretary’s comments that the scheme will be industry and expert led but, under current plans, the level of deposit will be set by politicians through legislation, rather than by the scheme administrator. Does the cabinet secretary agree that technical experts would do a better job of setting the deposit level in order to meet targets?

Photo of Roseanna Cunningham Roseanna Cunningham Scottish National Party

I am not sure that I do. Our decision making on the deposit level arose directly out of the consultation that we carried out prior to embarking on the proposed scheme. The public consultation reinforced that the majority of respondents support a deposit of 15p or more. There is a tricky issue here, because the deposit has to be set precisely at a point that does not create a disincentive for people who are buying—it should not become a problem in the purchase—but that is not so low that it ceases to have the behavioural result that we want. Those are the main issues that we are considering.

I understand that there are some issues around the size of containers and so on that are creating some interest and debate. However, at the moment, I feel that to ensure that we do not start devaluing some containers in the eyes of consumers, having a flat rate is the best place for us to be.

I am happy to have a conversation with Maurice Golden if there are very specific issues that he wants to raise separately.

Photo of Angus MacDonald Angus MacDonald Scottish National Party

Coincidentally, the Environment, Climate Change and Land Reform Committee has just completed a marathon evidence session on the DRS with a large number of stakeholders this morning, and we look forward to the cabinet secretary visiting our committee next week.

While recognising the need for our system to be reflective of the needs of people in Scotland, will the cabinet secretary outline what lessons have been learned from international evidence, other than the Norwegian example, and from deposit return schemes that have been implemented elsewhere?

Photo of Roseanna Cunningham Roseanna Cunningham Scottish National Party

Deposit return schemes operate in more than 38 countries around the world, and it is important that we remind ourselves of that. Evidence and experience from well-developed systems around the world have underpinned the development of our scheme. The key points that we have learned include the importance of a scheme being owned and operated by producers in line with the principle of producer responsibility, using the return-to retail approach to ensure that the scheme is accessible and fair, and having a deposit level that encourages the right behaviour from consumers. That point goes back to the answer that I gave to Maurice Golden about the deposit level and where we think it is best placed.

Photo of Finlay Carson Finlay Carson Conservative

Although there is widespread support for a deposit return scheme, there are concerns over the data on current recycling rates that is being used, particularly when it comes to aluminium cans. Will the cabinet secretary explain why baseline data on recycling levels is being used to back up the business case when Zero Waste Scotland specifically stated that it should not be used for that purpose?

Photo of Roseanna Cunningham Roseanna Cunningham Scottish National Party

I am not conscious of that statement from Zero Waste Scotland. Zero Waste Scotland is involved in all the discussions; it is very much key to what we have introduced and what we are doing and it is also very much involved with the implementation advisory group. If Finlay Carson gives me some context for the statement, I am happy to take up the matter with Zero Waste Scotland and query on what basis it made the comment. It is rather odd for me to hear it, because it is not what I am hearing from Zero Waste Scotland. Perhaps Finlay Carson and I can have a conversation about that.