UK Deposit Return Scheme regulations published - Wales excluded

The UK Government has released draft legislation for a new Deposit Return Scheme (‘DRS’) for drinks containers in England, Scotland and Northern Ireland.

The DRS will involve paying a deposit when purchasing a relevant drinks container, with this being refunded when the container is returned to a designated return point. The DRS aims to reduce littering, increase recycling and promote a circular economy. The Explanatory Memorandum to the newly released regulations says that the scheme will ‘result in carbon emission savings’ due to a higher amount of material being recycled.

The DRS was initially due to launch in 2023, but this was pushed back to 2024, then 2025 and now 2027. This new deadline is set with the aim of allowing consumers and retailers more time to understand and prepare for the DRS. The scheme will include all plastic PET containers and metal drinks containers sized 150ml to 3 litres.

In November 2024, the Department for Environment, Food and Rural Affairs (‘DEFRA’) announced that the UK Government is ‘fully committed’ to the DRS and will continue to work closely with the Scottish Government and the Department of Agriculture, Environment and Rural Affairs (DAERA) in Northern Ireland towards introducing it in October 2027.  However, it has been confirmed that the DRS will not include Wales.

Due to the safety and storage concerns involved, the DRS will exclude glass from the scheme. The Welsh Government had wanted to include glass within the list of materials to be covered under the DRS, and so are implementing their own separate DRS. Wales is reputed to be the second best recycling nation in the world,

Scotland initially planned to include glass in their own version of the DRS, which was due to have commenced in 2023, amidst much opposition from Scottish businesses. However, the UK Government considered that such a scheme would have breached the UK Internal Market Act.  Due to the UK Government and Scottish Government not being able to agree a resolution to this issue, the Scottish DRS collapsed, and Scotland is now joining the new DRS.

Currently, in the UK, drinks container recycling rates are at an average of 70%. By contrast, in Germany, where a DRS is implemented, recycling rates are at 98%.

The UK and Ireland director at the circular economy non-profit organisation, Reloop, has said the introduction of a DRS is a ‘tried and tested circular economy measure’ and has seen ‘strong public and political support’. 

There are, however, concerns.  The draft legislation arrives on the tails of the Autumn Budget, where it was confirmed employer’s National Insurance Contributions will increase from 13.8% to 15%. This increase has already put retailers under pressure, with the British Retail Consortium (‘BRC’) warning the chancellor that it will cause stores to shut, loss of jobs and increase in prices for consumers.

The introduction of a DRS adds potential further pressure on retailers, requiring them to take on responsibility for return points, provided for by the draft legislation. This also places further financial burden on consumers as the DRS increases the up-front cost of drinks, although this is refundable.

Despite these concerns, DEFRA has reported support for DRS of 83% in their consultations. The British Soft Drinks Association also supports the scheme believing it will allow ‘many producers to move to a more circular model for packaging.’

Going forward, there are calls from the BRC to keep DRS ‘aligned as far as possible across the UK’, as there will now be two independent schemes in operation. A well-designed and aligned DRS will maximise the benefits of the scheme for consumers and keep business costs down.

Click here for the announcement from DEFRA and here for the draft legislation.

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