The Fed is in talks with the Scottish government on a potential ‘compromise’ to support stores left out of pocket by the delay to the nation’s deposit return scheme (DRS). 

RN can reveal that while the Scottish government has said compensation for retailers and drinks producers is off the table, ministers have requested “more information” on a potential alternative solution put forward by the Fed. 

The trade group’s DRS lead and national vice-president, Mo Razzaq, did not disclose the full terms of the pitch to prevent jeopardising its chances of success, but said he was hopeful the talks could deliver a positive outcome for retailers affected. 

Industry sources estimate that there are 40 independent shops in Scotland that had already paid tens of thousands of pounds for a reverse-vending machine in preparation for the previous August 2023 and then March 2024 DRS go-live dates. Razzaq claims the recent delay until October 2025 and removal of glass from the scheme places a cost burden on these stores. 

“We have come up with a solution for these stores, and we are confident that this can work,” the senior Fed figure said. 

Read more: Scotland delays DRS until 2025

Further DRS changes 

The development comes as the Scottish government attempted to win the hearts and minds of the industry with further amendments to DRS in Scotland passed last week. 

These include: remov-ing drinks of less than 100ml (such as alcohol miniatures) from the scheme; removing products selling less than 5,000 units per year from the scheme (craft alcohol is expected to be a major beneficiary of this); simplifying the process for stores seeking an exemption from operating a return point; and removing most bars, pubs, restaurants and cafés from having to take returns. 

Impact of Scotland’s delay 

An attendee at a recent Department for Environment, Food and Rural Affairs (Defra) meeting on a UK-wide DRS told RN Scotland was well placed to act as a test-bed for the UK scheme, as the full infrastructure was in place, including recycling centres, collection vehicles, returns machines and scheme administrator Circularity Scotland. 

While the Scottish government minister responsible for Scotland’s failed DRS called on Defra to make use of Circularity Scotland’s expertise, she refused to inject extra public funds into the company to cover its costs until the scheme begins, putting its survival in jeopardy. 

In response, Circularity Scotland said: “The unfortunate reality is that, at this point, we are not able to confirm whether our staff will be paid for this month or whether they will be able to return to the office.” 

Read more deposit return scheme (DRS) news and advice