Deposit and Return Scheme for Scotland Regulations 2020 (as amended): equality impact assessment

Mitigations Considered

52. Mandatory takeback obligation. The DRS legislation will no longer contain an obligation for retailers to provide takeback services if they sell drinks online. This means that there is no longer a formal mitigation within the DRS legislation against the risk that consumers that are reliant on distance sales and unable to access a return point will be able to reclaim their deposits.

53. Most retailers of drinks and their representative organisations operating in Scotland have consistently raised concerns about the requirement to operate a mandatory takeback service under the Deposit and Return Scheme for Scotland Regulations 2020. Retailers have advised that the costs of developing and operating a mandatory service could be disproportionate and could result in certain grocery items, including but not limited to drinks within the scope of the DRS, being withdrawn from online sales.

54. There is therefore a high risk that inclusion of a mandatory takeback obligation within DRS legislation, as an approach to mitigating any potential impact of the scheme upon those reliant on distance grocery sales, could have the unintended consequence of restricting access to online grocery items. This would negatively impact all consumers in Scotland, including those with protected characteristics.

55. The risk that grocery sales, or at least drink sales, could be withdrawn was considered low in previous impact assessments since there was an expectation that a takeback service would be mandatory across the UK. The 2023 Government Response on Introducing a Deposit Return Scheme for drinks containers in England, Wales and Northern Ireland^[26] stated an intention to “Ensuring a takeback service is offered in respect of online purchases, particularly by large online grocery retailers, from day 1”.

56. However, the risk that some or all distance grocery sales could be restricted or withdrawn in Scotland increased following confirmation that the equivalent DRS Regulations in England and Northern Ireland do not include any provisions on mandatory takeback of scheme articles purchased online. This was a material change since the development and publication of our previous EQIAs. Continuation of the obligation in the DRS legislation would have required retailers selling scheme articles online to develop a takeback service in Scotland only; given previous concerns expressed by retailers about the mandatory takeback service requirements it seems unlikely that this service could be provided in Scotland only, which increases the risk of retailers withdrawing online drinks sales instead.

57. Voluntary services. There is scope for takeback services to be developed and provided on a voluntary basis. The amended provision in the DRS legislation allows for any person to apply to the SA to be registered to provide takeback services. This could be an individual, a retailer, a third sector organisation, or the SA could provide such a service themselves.

58. This may mitigate the risk that consumers are unable to reclaim their deposits, but will be dependent upon action taken by persons or businesses voluntarily.

59. Mandatory takeback is not a requirement of existing Deposit Return Schemes which operate in other countries, and remains a relatively rare service, even with the most established DRS schemes in Europe. Those takeback services that do exist, for example Pantahemma in Sweden, are small scale and are not mandatory. They have been implemented to answer growing consumer demand from those who shop online^[27]. Currently, there is not a proof-of-concept model of a successful and large-scale takeback service.

60. Scheme Administrator support. The scheme administrator will be providing a service to the public, and is therefore prohibited from discriminating based on protected characteristics and must make reasonable adjustments (s29 Equality Act 2010^[28]). Takeback may be an important tool for the SA to improve accessibility and meet legal collection targets. The success of a DRS, and viability of the SA, is dependent upon consumers being able to return scheme packaging.

61. While there is no obligation upon the SA to provide takeback, the SA application process required any SA candidate to detail how it would support accessibility requirements. This included how the candidate would consider the collection and return of in-scope containers for consumers with accessibility requirements and how they would consult with stakeholders regarding DRS accessibility.

62. The SA candidate also had to detail how accessibility considerations will be captured in guidance provided to return point operators. This included wheelchair access to reverse vending machines and / or kiosks containing return points and the provision of manual returns support for those unable to access main return points.

63. The proposed designated SA candidate for DRS in Scotland, UK Deposit Management Organisation Limited, has committed in its application to continuous improvement in ensuring equality of access of the DRS. This includes engagement with disability advocacy groups to understand any additional needs and incorporate their feedback into the scheme. By prioritising accessibility and inclusivity, the SA is aiming to create a DRS that is equitable and beneficial for all members of society.

64. The SA has also committed to supporting retailers and other stakeholders who wish to offer takeback services, particularly where it will maximise the return of drinks containers from consumers with accessibility requirements. This could involve home collection services, where empty containers can be collected from homes of individuals who are unable to visit return points. It will be for the SA to determine the exact terms of each registered takeback service.

65. The SA candidate will consider encouraging community collection points which could provide accessible locations for returns and increase return rates for consumers. These have proved popular with consumers taking part in the scheme in the Republic of Ireland.

66. Return points. The DRS Regulations require that groceries retailers such as supermarkets and convenience stores host a return point unless they are in urban areas and the shop premises are smaller than 100m2. However, any groceries retailer which is not automatically exempt can also apply to the SA to be granted an exemption from operating a return point if they meet certain criteria.

67. This will ensure that there will be an effective network of return points. The DMO will be required to ensure that there are enough return points in rural areas. The proposed designated SA candidate has committed to designing a DRS that properly serves the rural and island communities in Scotland, creating a flexible, accessible and community-focused system.

68. There will be no time limit on returning containers, so this will also support consumers who cannot regularly access a return point to redeem their deposit.

69. The SA will also work with retailers on return point functions, particularly regarding the specifications of manual return points and RVMs. It is in their interest to ensure return points are widely available to support their efforts to meet the legal collection targets for empty containers. The SA will also consider how the usability of the machines to ensure the needs of all consumers are catered for.