HANSARD
Deposit Scheme for Drinks Containers (England and Northern Ireland) Regulations 2024
- Considered in Grand Committee
- 4:51 pm
- Moved by
- That the Grand Committee do consider the Deposit Scheme for Drinks Containers (England and Northern Ireland) Regulations 2024.Relevant document: 11th Report from the Secondary Legislation Scrutiny Committee. (special attention drawn to the instrument).
- My Lords, the Government are committed to transitioning the UK to a circular economy. We want to finally move away from the linear “take, make, throw” model, which we know causes harm to our environment and our society, and towards an economy that keeps our valuable resources in use for longer. A deposit return scheme for drinks containers is a strong example of the circular economy in action. It is a critical first step.Deposit return schemes are a well-established and proven method and over 50 schemes are already in place, including in Germany, Sweden and the Republic of Ireland. A DRS incentivises consumers to return and recycle their drinks containers and means that valuable materials are collected, recycled and made back into new drinks containers—a truly circular loop.The deposit return scheme is one of the three core pillars of the packaging reforms, alongside the extended producer responsibility for packaging and the simpler recycling programme for England. Together, it is estimated that these packaging reforms will support 21,000 jobs in our nations and regions and help stimulate more than £10 billion of investment in recycling capability over the next decade. They are also estimated to deliver carbon savings of over 46 million tonnes of carbon dioxide equivalent by 2035—valued at more than £10 billion in carbon benefits.At its heart, the deposit return scheme is a key environmental policy that will tackle the scourge of littered drinks containers, protect our beaches and countryside, preserve our wildlife and restore pride in our local communities. The benefits of the DRS in reducing littering cannot be overstated. Each year in the UK, approximately 4 billion plastic bottles and 2.5 billion metal drinks containers are not recycled. Instead, they are disposed of in general waste or littered.We are all familiar with the destructive impact of litter. In recent years, we have seen littered drinks containers blight our marine environment, but it does not stop there. According to a recent report from Keep Britain Tidy, littered drinks bottles and cans along our roadsides are killing millions of our native mammals every year. This is devastating our rarest and most important small mammals such as shrews, bank voles and wood mice. We must act to protect our natural environment.A deposit return scheme established under this instrument will also promote a fairer society. Obligations will be placed on drinks producers to ensure that containers are collected and recycled. This is consistent with the well-established “polluter pays” principle. We have set an ambitious target for the scheme to collect 90% of in-scope containers by the third year of operation.Laid in draft before the House on 25 November 2024, this instrument establishes, in England and Northern Ireland, a deposit return scheme for drinks containers. Under a deposit return scheme, a person who is supplied with a drink in a container that is in scope of the instrument pays a deposit that can be redeemed when it is returned for recycling. The scheme design in this instrument is informed by well-established international examples and extensive industry experience. Many of our industry partners have shared their experiences delivering these schemes across the world. The scheme will be centrally managed by an industry-led, not-for-profit organisation called the deposit management organisation.
- 5:00 pm
- My Lords, I thank the Minister for introducing the instrument before us. I support its contents but I want to clarify a couple of issues.Can the Minister clarify the situation in Wales? I understand her to say that the scheme will not be offered in Wales and that the Government are no longer engaging with Wales. Do they have a commitment from Wales? I just want to clarify that because, obviously, the situation in Scotland is welcome.I am grateful to both Coca-Cola and the Food and Drink Federation for their briefings and preparation for today; I am an officer of the All-Party Parliamentary Group for Food and Drink, which is why I asked them for a briefing. They welcome the concept but, in their view, it is important that it is rolled out across the United Kingdom.The Minister referred to other jurisdictions. I am familiar with how the scheme operates in Denmark; it has had rather perverse consequences. I sometimes feel as though I could pay for my whole Danish holiday if I went around collecting all the bottles and cans left after picnics in parks across Copenhagen and took them back. The deposit—it is called Pant—is actually set at quite a high level, so it would be helpful to know what level the Minister and the Government have in mind. Obviously, it has to be set at a level that is affordable for the consumer, ensuring that they are willing to go back and return a container to the place where it was bought.Obviously, we must have a deposit management organisation on side. Who will be the deposit management organisation in England? Will it be the supermarket? As consumers, we are concerned about the impact this will have on small convenience stores, which will perhaps not have the facilities to take these returned bottles or whatever after use. It would be helpful to have clarification on what the costs will be and who will provide the service, because they are going to require a very large facility to accommodate the containers being returned.
- My Lords, I thank my noble friend the Minister for presenting the case for the deposit return scheme. I declare my interest as a member of the Secondary Legislation Scrutiny Committee in your Lordships’ House. I welcome this SI and agree with my noble friend that it will make a major contribution to the reduction of littering. Numerous cans and other types of litter are strewn across the countryside and nobody appears to take responsibility, apart from local neighbourhoods that engage in their own collection schemes. I laud them for doing so.I have some questions in relation to Northern Ireland. Normally this would be a devolved measure. I suppose that the UK Government were trying to ensure that there was a collective approach on the part of the Government and the devolved nations and regions. Perhaps my noble friend could explain the purpose of including the devolved nations and regions. Also, will the money collected from this scheme in Northern Ireland go to the Treasury, or will it go to the Department of Finance, where it can be invested in local schemes, and into the general exchequer for the delivery of lots of different types of service? I am well aware of the value of the plastic bag scheme in reducing litter but also in terms of the money. It has added to the portfolio of money available for the enhancement of services.Secondly, I have a couple of questions in relation to Wales, which, I note, has not signed up to this scheme. How can the interoperability of the four UK schemes and the avoidance of unique identifiers in the Welsh market be assured? With Welsh proposals not yet published, how can the October 2027 introduction date be assured to avoid material switching under the EPR scheme? Will the Government ensure that the divergence of the Welsh scheme does not impact the governance of the UK, Northern Ireland and Scotland deposit return scheme and the appointment of a scheme administrator?
- My Lords, I echo the comments made by the two previous contributors on compliance for small businesses, which is crucial. It is all very well for large companies to say, “Yes, we support these schemes”, but the burden will often fall heavily on the small retailer, in one form or another. I should start with a mea culpa, in that I was head of personnel for Coca-Cola when it introduced the first ever plastic bottles into this country, so it is all my fault. For the benefit of my noble friend next to me, in particular, the first plastic bottles produced in this country were made in a factory in Leeds—a bottling plant in Pudsey.I therefore also have a memory of glass bottles and the system that worked then. The glass bottle return system had gone out of operation in most parts of the country when plastic bottles were introduced. At the risk of being accused of regionalism or being rude about the Scots, that system lasted longer in Scotland because that part of the country returned their products to the retailers to reclaim the deposits available.
- A thruppenny bit.
- It is important to small businesses and, because we are talking about companies that operate worldwide, both producers and retailers. How closely will our system meet that of the other countries that the Minister identified? I am aware that there are negotiations in other parts of Europe on some form of return system; it would clearly be better for all concerned if there is either a common or a virtually common system. That is particularly the case for Northern Ireland versus Eire, as many of the products will move from one side of the border to the other.My concerns are about why glass is excluded, the international basis of the operation and its similarity with others, and small businesses that will carry a burden in one form or another. Given the experiences that I witnessed in my previous role for many years—I should add that I later went on to become head of the British Soft Drinks Association, and therefore saw operations not only from Coca-Cola’s side but for waters and fruit juices—it is important that this works across the whole country. I recognise and expect that the returns will operate much better in some places than in others.
- My Lords, I thank the Minister for her introduction to this statutory instrument. It is vital to ensure that, as a country, we reduce our waste and engage the consumer fully in the process. As the Explanatory Memorandum clearly states, the power to introduce a DRS was enshrined in the Environment Act 2021, nearly four years ago, but the issue was being debated as early as 2019, with Defra running two public consultations. The first gave 84% support from those participating; the second, 83%, so why has it taken so long to get to this position? I do not wish to be impolite to the Minister, as she has been in post for only a short time, but it has to be said that there was a lot of pratting about by the previous Government. This is, of course, a technical term.The scheme is to be run by a direct management organisation—a DMO—and this will take another two and a half years to get up and running, so will not start until October 2027. They say that Rome was not built in a day, but I despair at the leisurely timeframe. Meanwhile, the country is knee-deep in waste.I welcome the application of civil penalties to drinks producers that do not comply, but it would make a big difference if civil penalties were applied to individual consumers who carelessly discard their drinks containers around the countryside. I am not convinced that the carrot of a returned deposit will alone change behaviour; there needs to be a stick element as well.Despite a not-for-profit DMO being set up to administer the scheme, local authority trading standards departments will be involved in monitoring and enforcement, along with the Environment Agency. As the Minister knows, local authorities are underfunded, with social care swallowing their budgets at an alarming rate. Do the Government intend to produce additional funding for local authorities trading standards to carry out this not inconsiderable extra work?
- 5:15 pm
- Paragraph 7.6 of the EM gives details of how Defra has been raising the profile of the impending scheme. The industry cannot claim that it did not have enough time to get ready for implementation. Paragraph 8 of the EM states:
- “Guidance may be published by Defra”.
- Surely to goodness, with the amount of time that has elapsed and the amount of consultation that has gone on, the industry must be ready by now to engage with the scheme and understand which way is up. Paragraph 9.3 states:
- “The legislation does impact small or micro businesses”,
- as the noble Lord, Lord Hayward, said. If the scheme is to be effective, which it must be, it should affect everybody—not just businesses.
- After the extended period of negotiation and discussion between the devolved authorities, Wales has decided to proceed alone and include glass in its DRS. The previous Conservative Government decided that, due to the internal market Act of 2020, they would exclude glass. I have sympathy with Wales and feel that it is a lost opportunity, bordering on negligence, not to include glass. However, to give as an excuse that there was insufficient time available to include glass is derisory. Scotland has already installed its DRS machines and equipment, but it is lying idle, waiting for the Government to make their mind up about what they want to do.
- The decision of Wales to continue alone is causing some concerns within the industry, which does not believe that a seamless scheme can progress if Wales is not included. I share those concerns but am more concerned that glass has been excluded from the scheme that will operate in England, Scotland and Northern Ireland. This is difficult to understand, given that glass was one of the first household items to be considered for recycling and that consumers embraced this concept from the beginning.