My Lords, deposit return schemes are another important reform introduced by the Bill to maximise our resource productivity. It was heartening to hear support across the House for their introduction.
This Government are determined to crack down on the waste and carelessness that destroy our natural environment. The noble Baroness, Lady Jones of Whitchurch, was right to point out in her opening speech that in our manifesto we committed to introduce a deposit return scheme this Parliament. We remain absolutely committed to delivering on that commitment. I thank her for Amendments 133 and 133A. We are currently analysing responses to our consultation from environmental NGOs, businesses and trade organisations on the deposit return scheme, which consulted on implementation timelines for 2024, the scheme design and the exact responsibilities of a deposit management organisation. This also included proposals on the size of containers and materials to be included. We will publish our response as soon as possible.
I appreciate that noble Lords are keen to see the introduction of a DRS for drinks containers introduced as soon as possible—so am I. But realistically, particularly
following the impact of the pandemic, we need to make sure we balance this anticipation with the needs of businesses, which will need time to adapt their processes to a DRS. The impact assessment for this measure identified that the net costs to businesses were likely to be £266 million a year, so we need to make sure that we fully consider the time needed for them to adapt.
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The recent consultation explored the implications of different timelines on businesses. Businesses have been clear that they need some time to ensure that scheme infrastructure and operational contracts are in place before a scheme can be introduced. But, again, to be clear, we remain committed to delivering a DRS in this Parliament.
In response to Amendment 133A, I am pleased to confirm to the noble Baroness, Lady Jones of Whitchurch, that Schedule 8 already makes provision for any item to be specified as a deposit item for the purposes of a DRS. This includes specifying the material from which the item is made, as well as the size of that item. In response to questions raised by the noble Baroness, Lady Bennett, and my noble friend Lord Trenchard, our recent consultation proposed that the scope of the deposit return scheme should include polyethylene terephthalate bottles, steel and aluminium cans and glass bottles. I know that the noble Baroness, and many others across this House—including the Government—want to see ambition at the heart of a future DRS. I am therefore also pleased to confirm that options for future schemes are broad and could look at a range of items such as food pouches, coffee cups and even mattresses.
Regarding Amendment 134, tabled by the noble Baroness, Lady Bennett of Manor Castle, I am happy to say that Schedule 8 allows provision to be made in regulations to set either a fixed or variable deposit rate, as requested by the amendment of the noble Baroness. The case for a fixed rate is that it will help ensure simplicity and might be easier for consumers to understand. However, a variable rate deposit level could be set to reflect the size of the drinks container and might help reduce the impact on sales of containers that are part of a multipack, for example. Ultimately, in designing this part of the Bill, we wanted to allow the deposit management organisation to have the flexibility and control in setting the deposit level to whatever is most helpful for it in meeting statutory collection targets. I hope that the noble Baroness will agree that this is the most pragmatic approach.
With regards to my noble friend Lord Carrington’s comments on the deposit management organisation, there has been strong support for a deposit management organisation to be an independent, not-for-profit and private organisation. This has been a model that has been successfully utilised internationally and ensures that the scheme can be managed in the most cost-effective manner. It is currently the model that we intend to use for the purpose that we have just described.
The Government fully share the concerns raised by my noble friend Lord Trenchard in his Amendments134A, 134B, and 138A. I fully agree with his points around
protecting small businesses, as I am sure we all do. It has been a tough year for small businesses and breweries right across the country. We want to protect the smallest drinks producers from the cost burden associated with the introduction of a deposit return scheme. Schedule 8, therefore, allows exemptions to be made with regard to the size of supplier or producer, and to take account of the impact on small producers, including breweries, as suggested by my noble friend’s amendment. Our recent consultation proposed allowing smaller producers to pay minimal or no annual registration fees, which I hope my noble friend welcomes.
A number of noble Lords, including my noble friend Lord Caithness and, I believe, my noble friend Lord Carrington as well, made comparisons with progress that we have seen in Scotland. It is true that the Scottish Government were ahead of us in planning for the introduction of their DRS. The primary powers underpinning their legislation were enacted in 2009. It is our intention that the schemes in Scotland and England will work together to ensure a coherent approach to returning items. We will continue to work with Scotland to develop these proposals. We want to make sure that any DRS that is right for England draws on the evidence of what works elsewhere in the world and achieves our goals of reducing litter from drinks containers and improving their recycling. Ultimately, we want to have an ambitious but realistic timetable to ensure that we are implementing a DRS that will be as effective as possible. The second consultation has just closed, which includes details of the proposed timeline for introduction of a scheme.
In summary, I would like to reiterate our commitment to a deposit return scheme for drink containers as soon as possible—in a way which improves our resource efficiency, tackles litter and brings businesses with us—and to reiterate our ability to bring forward more schemes in the future as well. I hope that noble Lords are reassured. We have tried to find a sensible balance in driving ambition and pace, while recognising that businesses need a sensible lead-in time. I therefore respectfully ask the noble Baroness to withdraw her amendment.