Supermarket bosses have called on the UK government to scrap its plans for a deposit return scheme, in what sources warned could be a fatal blow to the proposals.
Retail chiefs warned the scheme would hit the industry with at least £1.8bn in extra costs from 2025, when it was due to be launched. This would inevitably be passed on to consumers in the form of higher prices, they added.
Over the weekend the BRC released new figures from research claiming plans for DRS could cost retailers in England more than £200m alone in installing the necessary network of reverse vending machines.
When added to other factors such as running costs, IT costs and extra staff, that would lead to costs of over £1.4bn in England and almost £2bn across the UK as a whole.
The consortium said its figures did not include the “hundreds of millions” needed to set up a body to run the scheme.
Last month it emerged Circularity Scotland Limited (CSL), the industry run body set up to run Scotland’s DRS scheme, had collapsed owing creditors nearly £90m, which supermarket chiefs say would be dwarfed if a scheme in the rest of the UK also fell down.
The Grocer revealed last month that Defra was struggling to get buy-in from the industry to set up an administrator for DRS, following the disastrous attempt to launch DRS in Scotland as a pioneer for the UK.
CSL entered administration after the Scottish government shelved the launch, for a third time, with Scotland now due to launch a scheme alongside the rest of the UK from October 2025.
Also last month a report by the National Audit Office called on the government to look again at the evidence for DRS and consider whether instead of a national rollout it would be better to launch a pilot scheme to gather evidence about its effectiveness.
That report has been seized upon by supermarket bosses, who said the government’s ambitious target of eliminating all avoidable waste by 2050, and all avoidable plastic waste by 2042, would not work without a “fundamental rethink” of its resources and waste strategy.
This includes the introduction of extended producer responsibility (EPR), already also delayed until 2025, the consistent collections of household and business recycling in England, and DRS.
The BRC said it was essential for reforms to household recycling collections and EPR to be introduced together, and only then would it be clear on the exact role of a DRS in further improving recycling rates.
“The proposed deposit return scheme is costly, complicated and cannot deliver the step change in recycling needed to justify it,” said BRC director of food & sustainability Andrew Opie.
“By driving up costs by almost £2bn per year the government risks pushing up prices for ordinary households, just as inflation is coming down.
“The government must first introduce its household collection and packaging levy reforms so that it can assess the best way forward on a DRS. On its current course, it will be consumers who will pay the price of this unnecessarily hasty, expensive and complex scheme.”
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