A government recycling initiative could impose a significant financial burden on retailers.
- The British Retail Consortium estimates the annual cost at £1.8bn, a figure considerably higher than initial government projections.
- The scheme intends to reduce plastic waste through a refundable deposit on drink containers.
- Concerns arise that costs could be passed onto consumers, exacerbating already high prices.
- Industry leaders are calling for a delay and re-evaluation of the scheme’s complexity and cost.
The government’s Deposit Return Scheme (DRS) is poised to introduce a substantial financial load on UK retailers, estimated at £1.8 billion annually by the British Retail Consortium (BRC). This figure starkly contrasts with the government’s 2019 estimate of £171 million per year, suggesting a tenfold increase in anticipated costs. The initiative is part of broader efforts to achieve net zero emissions by reducing plastic waste through recycling incentives.
Central to the scheme is a 20p deposit applied to beverage containers, refundable upon their return. This mechanism aims to encourage recycling and diminish plastic pollution. However, a substantial portion of these costs could ultimately shift to consumers, influencing retail prices amidst ongoing economic concerns.
Commenting on the directive, Andrew Opie, BRC’s Director of Food and Sustainability, criticised the proposed scheme as excessively costly and intricate. Opie expressed apprehension that the initiative’s expense could counteract inflation reductions, further burdening households financially. He advocates for the government to first implement comprehensive household recycling reforms before proceeding with the DRS to better evaluate its impact.
The deployment of the DRS was initially scheduled for Scotland in March 2024, yet this has been deferred to October 2025. The delay emerged following warnings from industry leaders, urging collaboration with Westminster to ensure adequate support. Meanwhile, the broader introduction in England remains under scrutiny, particularly regarding its economic viability and operational complexity.
Parallel to this, the Department for Environment, Food and Rural Affairs has postponed its Extended Producer Responsibility scheme. This delay, prompted by predictions of significant price increases in food, reflects broader apprehensions within the grocery sector about cost implications linked to environmental compliance initiatives.
The potential financial impact of the Deposit Return Scheme on retailers necessitates careful reconsideration and evaluation before implementation.
