Deposit and Return Scheme for Scotland Regulations 2020 (as amended): Fairer Scotland Duty assessment

Low incomes, low wealth and material deprivation

46. It is estimated that 21% of Scotland’s population, over a million people each year, were living in relative poverty^[28] after housing costs in 2020-23.^[29] Around a quarter of those in relative poverty are children.^[30] The relative poverty rate for all across Scotland is similar to 2022 however this rate is slightly higher than levels in the past decade.

47. It is estimated that 17% of the population were living in absolute poverty^[31] after housing costs in 2020-23. Before housing costs, 16% of the population were in absolute poverty in 2020-23.^[32] Increases in the proportion of people living in absolute poverty indicate that prices are rising faster than the incomes of the poorest households.

48. Citizens Advice Scotland has found evidence of a “poverty premium” among low-income households.^[33] This suggests that individuals struggling to afford food due to rising prices, particularly towards the end of the month, might have less money to spare on non-essential items. It is not unreasonable to consider the cost of a deposit could also fall into a similar bracket.

49. According to the 2022^[34] household survey, 11% of those aged 16-34 and 12% of 35-59 years old said they are not managing well financially. These low-income groups have the potential to be adversely impacted by the initial upfront cost of deposits for in-scope container purchased.

50. Average equivalised household disposable income across the UK, by age group of the adult in the household with the highest gross income for 2021/22 was lowest in the 16-24 age group (£27,596 per year), followed by those aged +65 (£31,085 per year). With disposable income for other age groups ranging from £37,584 (55-64) to £40,926 (25-34). This shows that the youngest and oldest are most likely to have the least disposable income. ^[35]

51. Poverty rates remain higher for households in which somebody is disabled compared to those where no-one is disabled. Scottish national statistics show that in 2020 -2023 24% of households where a household member is disabled are more likely to be in relative poverty compared to 18% of households where no one is disabled. ^[36]

52. The poverty rate has been consistently higher for LGBT+ adults compared to heterosexual adults since this category was first assessed in 2011-14. In 2020-23, 25% of LGBT+ adults were in poverty, compared to 19% of heterosexual adults and 21% of adults whose sexual orientation was not known.^[37]

53. In 2018-23, people from minority ethnic (non-white) groups were more likely to be in relative poverty after housing costs compared to those from the 'White - British' and 'White - Other' groups. The relative poverty rate was 50% for the 'Asian or Asian British' ethnic groups and 51% for 'Mixed, Black or Black British and Other' ethnic groups. The relative poverty rate amongst the 'White - Other' group was 22% and that of the 'White - British' group was 18%.^[38]

54. The mean equivalised household disposable income, across the UK, by ethnicity for 2019/21 was lowest in the Black African, Black Caribbean and Black Other ethnic group categories (£31,633 per year). Mixed (£33,886 per year) and Other (£35,916 per year) ethnic groups were the next lowest, with Asian (£36,454 per year) and White (£36,660 per year) having the highest disposable income.^[39]

55. In 2018-23, Muslim adults were more likely to be in relative poverty (61%) than adults overall (19%), after housing costs were taken into account. For adults belonging to the Church of Scotland, 16% were in relative poverty after housing costs (160,000 adults each year), compared to 17% of Roman Catholic adults (90,000 adults) and 21% of adults of other Christian denominations (70,000 adults).^[40]

56. These low-income groups have the potential to be adversely impacted by the increased costs of scheme containers. However, if consumers engage with the scheme, returning the containers and redeeming their deposit, the net impact should be minimal.