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Deposit return scheme ‘deeply flawed and open to potential fraud’

Arran Brewery owner Gerald Michaluk has raised concerns over the impact of the initiative on small businesses.

The owner of a Scottish brewery raised concerns over the proposed scheme (Victoria Jones/PA)
The owner of a Scottish brewery raised concerns over the proposed scheme (Victoria Jones/PA)

The owner of a Scottish brewery has raised concerns over the introduction of a deposit return scheme and its impact on small businesses.

Earlier this month, it was announced cans, plastic bottles and glass would be included in it as part of efforts to tackle climate change.

Gerald Michaluk, the boss of Arran Brewery, has described the scheme as “rushed, deeply flawed and open to potential fraud”.

He said while he supports the overall objectives of increasing the rate of recycling, he warned of a potential financial burden being placed on small businesses.

Mr Michaluk said large supermarkets would be in a stronger position to handle the returns process and to fund repayments.

“Small businesses, as well as large supermarkets, will be required to set up the infrastructure to handle the returns and fund the deposit repayments,” he said.

“Not too easy, physically and financially, for a small business.

“If the supermarkets do it better, as they will, why will consumers not just shop there, too?

“Yet another nail in the high street coffin. You can see why the supermarkets like the idea.”

Scottish Environment Secretary Roseanna Cunningham said the scheme would place a return value of 20p and would be up and running by the end of the current Parliament in 2021.

It means Scotland would become the first part of the UK to introduce such a scheme, with an aim of capturing 90% of drinks containers for recycling within three years.

Mr Michaluk raised concerns over the initiative only applying to Scotland.

He claimed this could raise the potential for fraud, where bottles could be purchased in England at a lower cost – as the 20p would not be applied – and then returned to businesses in Scotland to pick up the repayment.

To counter this, he said a measure such as labelling bottles sold in Scotland would have to be brought in – but it could add to the expense incurred by small businesses.

Consumers need to understand and be willing to pay more than those living elsewhere in the United Kingdom Gerald Michaluk

Mr Michaluk also called for any such return scheme to be introduced UK-wide, as opposed to it being brought in only in Scotland.

He said: “Any deposit scheme needs to be coordinated nationally within the UK as a whole. Having Scotland going alone is stupid.

“Small production businesses need to be exempt, at least initially. There must be a cap on the costs business is expected to fund.

“It needs to be thought through a lot more and in conjunction with the rest of the UK. We don’t need four different schemes, labels, and rules.”

He added: “Pilot on a small scale first make sure it works before rolling out from the big producers downwards.

“Consumers need to understand and be willing to  pay more than those living elsewhere in the United Kingdom. Careful watch has to be kept to prevent fraud.

“Political isolationist and anti-competitive doctrine needs taken out of this scheme’s proposals.”

A Scottish Government spokeswoman said: “We believe Scotland’s deposit return scheme can help us to achieve a glass recycling rate approaching 90%, which is well in excess of that being recovered through existing collection arrangements.

“The inclusion of this material will deliver significant carbon reductions and help to address the disproportionate impact that glass litter currently has on our communities and wildlife.

“We have designed the scheme in a way which ensures glass manufacturers will benefit from access to high quality recycled material, and the intention is that the DRS will be cost neutral for retailers.

“We will continue to work closely with the industry during its implementation.”

PA

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