Glass deposit scheme 'risks major problems' for retail industry

The owner of a historic wine merchant has said a new recycling scheme risks "major problems" for Wales' retail industry.

James Tanner said the decision to bring in the deposit return scheme (DRS) from October 2027 could cause alcohol retailers to leave the market and increase costs for customers, adding he would be "reluctant" to expand his own company in Wales.

But Owen Derbyshire, of charity Keep Wales Tidy, said the move would be "transformational" in reducing litter and changing habits.

The Welsh government said the scheme helped Wales build on its "already world-leading recycling levels", and would be "carefully phased in" with exemptions to "prevent added costs for small businesses".

James Tanner runs the family business Tanners which has facilities in Welshpool, in Powys, and Llandudno, in Conwy county, and currently employs about 60 people in Wales.

He described the DRS scheme's impact as "complicated", highlighting the issues faced by the Scottish government in recent years.

Ministers were forced to drop proposals for a Scotland-specific bottle return scheme in June 2023 following a dispute with the UK government.

Tanner said his main concern revolved around the adoption of dedicated barcodes for each bottle. These are required so reverse vending machines and counting facilities can identify the items, but Tanner said they would require his company to have two separate stocks of wine when delivering to Wales and England.

He said it would add cost, and was "particularly difficult when you're delivering up and down the Welsh borders".

Tanner added some suppliers may refuse to do it, and some producers in "fine wine areas" of France "won't put barcodes on their product anyway".

From 2027, people in Wales will be offered cash or vouchers for returning empty drinks bottles and cans to be reused and recycled.

Customers can return the empty container to designated return points, situated in places including local shops and supermarkets.

Under UK-wide plans, England, Scotland and Northern Ireland will introduce a DRS covering just plastic bottles and metal cans, also from October 2027.

The goal is to create a co-ordinated approach designed to cut litter, boost recycling rates and support a circular economy.

But Wales' decision to include glass is where the scheme has become controversial.

Hospitality, retail and drinks bosses have previously said they were concerned the scheme could result in cross-border fraud and higher drinks prices for customers.

But the previous Labour Welsh government said in March that laying regulations for Wales' DRS was a major step towards ending throwaway culture.

Tanner said he was "all for" the scheme if it meant that it would keep "cans and plastic bottles off the road".

But he agreed that it could be susceptible to fraud without a UK-wide barcode system to return your glass items.

"It all relies on English consumers not being able to go to Wales and redeem the 20p deposit from a Welsh retailer," he added.

Tanner said there would be a cost for customers who enjoyed other alcoholic beverages as well and, while his company was "very involved" in Wales, he thought other operators based in England "would contemplate" leaving the Welsh market.

"There's a very fluid market in the UK for buying bottled beer and spirits," he said.

"If you have to go to a wholesaler and say you want the Welsh stock, I'd imagine that it won't be available or will be more expensive.

"There would probably be a reduction of choice as well in terms of wine going into Wales."

Others, however, have welcomed the move, highlighting the "many different upsides" as a result of the scheme.

Owen Derbyshire, chief executive of Keep Wales Tidy, said the data seen by his team showed a "significant and quite dramatic uptick" in littering on Welsh streets.

It comes just weeks after a survey found that there was rubbish on 99% of main roads in Wales.

"If you look at how DRS operates internationally, within a year or two we see return rates going up and then the corresponding drop in litter rates is genuinely transformational," Derbyshire said.

"So, if we're thinking about this perpetual challenge of the cleanliness of Welsh streets just getting worse, this is a proper systemic intervention."

Derbyshire said the environmental charity's most recent statistics showed "one in seven streets" in Wales had glass litter on them, posing a public health challenge as well as a cleanliness issue.

He said there were "countless reports" which highlighted the damage littered glass could do to animals, as well as a reduction in violence relating to glass deposit schemes.

DRS are widely used internationally including in Germany, several Scandinavian countries and, more recently, the Republic of Ireland.

Keep Wales Tidy said the statistics showed significantly reduced drinks-container litter, improved the quality of collected materials, and enabled higher-value recycling or reuse.

Derbyshire said he felt this highlighted the economic benefits that could come from implementing a DRS for glass items.

"The quality of the glass is quite poor when it comes to remanufacturing bottles, and businesses desperately need that inflow of material," he said.

"DRS has provided that. So it actually does in the long term drive down costs."

Derbyshire said he understood the anxiety among small and medium enterprises as it represented a "big shift in the way that industries do things".

"But actually, there's investments in the circular economy in Wales and across the UK. It's an investment in cleaner communities," he added.

While the scheme is being launched next year, Derbyshire pointed out that it featured an "incredibly generous" four-year transition period for glass, to help producers and retailers adapt to the new requirements.