Deposit return scheme for Scotland: summary

Example 4 - Take back to any place of purchase (with cartons and cups)

Example 4 is similar to Example 3, where you would be able to take your drinks containers back to any shop that sells drinks in disposable containers. The difference is that Example 4 would collect a wider range of drinks containers and would be jointly run by a public body and the drinks/retail industry.

What this example looks like

This system is similar to Example 3, and would mean that any shop that sells drinks in disposable containers would have to provide a deposit return service so you can get back the deposit you paid on the container when you bought the drink. You would be able to take your container back to any of these shops – it wouldn't have to be the same one you bought the drink from.

The difference with Example 4 is that it would collect a wider range of drinks containers. It would collect PET plastic, which is the kind that fizzy drinks and bottled water are usually made of, and also a type of plastic called HDPE which is the kind that milk bottles are usually made of. It would also collect aluminium and steel cans, drinks cartons, glass bottles and some single use cups like coffee cups.

Who would run it

This example would see an organisation made up of a public body and leaders from the drinks and retail industries being set up to run the system. This organisation would make sure the system runs properly, and some of the money made by the deposit system would pay for its staff and running costs. It would need to make sure the shops paid in the deposits they had taken on drinks they had sold, and also that they received money for all the deposits they returned to customers. It would also arrange for the containers to be regularly collected and recycled.

Shops that sell drinks in disposable containers would have to provide a system in store to give people back the deposits on any drinks containers covered by the system ( PET and HDPE plastic, cans, drinks cartons, glass bottles and cups).

The effectiveness of these types of systems elsewhere in the world

This would be a uniquely ambitious system for Scotland as nowhere else in the world collects this range of material via a deposit return scheme. This means the system would be collecting a much wider variety of materials at a high rate, offering the highest possible capture rates and litter reduction.

The benefits and drawbacks of the example

As noted above, this would not only achieve a high capture rate for the materials included in Example 3, it is likely it would also help tackle a range of other materials, increasing the rate of recycling and preventing them from becoming litter.

Some of these items are harder to recycle, however one of the main obstacles to these materials being recycled is that they are not available separate to other materials in sufficient amounts to make recycling them cost effective. This would be addressed in a deposit return system. However, greater attention would need to be devoted to ensuring sufficient recycling infrastructure was in place for items that are not currently widely recycled.

As with Example 3, this would also offer the best accessibility due to the high level of return points in both rural and urban locations and the fact that these return points will be where people will be going to shop.

Qualitative Scoring of Example 4: Take back to any place of purchase (with cartons and cups)

Example 4 scored the highest at 84, but only 1 point more than Example 3. The two examples scored the same on accessibility, fairness and opportunities to raise funds for charities. It was scored slightly higher for employment opportunities, as the wider range of materials would mean more jobs to handle and reprocess the material.

The Net Present Value of Example 4: Take back to any place of purchase (with cartons and cups)

This example assumes a broad range of materials are in scope; glass bottles, metal cans, plastic bottles, beverage cartons and paper based take-away cups, with materials returned to any place of purchase. With a deposit level of 10p and return locations located at any premise that sells these containers, achieving a capture rate of 80%.

Example 4 has a total net benefit of £990 million over the 25-year NPV compared to not introducing a scheme. This is the highest NPV but it is also the scheme with the highest risk as it is more ambitious than systems in other countries.

Co-operation with the UK Government (Questions 49 to 52)

The UK Government announced on 28 March 2018 that it will introduce a deposit return scheme and will consult on options later this year. As noted in the components section, there are a number of ways in which being part of a UK wide system or at least co-ordinating separate systems would be beneficial. These include:

• Reducing or eliminating the possibility of cross-border fraud or leakage
• Ensuring systems are consistent for consumers who may cross the border frequently
• Simplifying supply lines for retail and industry
• Eliminating issues around product labelling and similar areas that are currently reserved to the UK Government

These need to be balanced against ensuring that the benefits for Scotland of any scheme are maximised. Key considerations in this regard are:

• Ambition of the scheme – other administrations may not want to include the same materials that the Scottish Government deems appropriate to include in the scheme following this consultation.
• Control of material – one of the key economic benefits of a deposit return system would come from having large quantities of very high quality material available for recycling. This availability could be used to attract plastic and other reprocessing companies to Scotland, which is a key goal of our resource management policy. There is therefore a case that a Scottish system administrator should keep control of the material collected in Scotland rather than having it aggregated with the rest of the UK's material.

As was noted in the introduction, deposit return can be seen as being part of wider producer responsibility. The UK Government has committed to reviewing the current producer responsibility system, in order to support a more circular economy and to meet the cost recovery requirements of the EU Circular Economy Package. Producer responsibility is a devolved issue but operated by agreement as a consistent system across the UK. It will therefore be important for us to continue to engage with the UK Government to understand the impact of these policy reforms on a Scottish deposit return scheme.