Government Response summary: DRS

This month, Defra announced that a Deposit Return Scheme (DRS) for drinks containers will begin in England, Northern Ireland and Wales in October 2025, with a collection target of in-scope materials at 90% by year 3 of the scheme’s operation. By the time the English, Welsh and Northern Irish schemes are fully operational, Scotland will have had a DRS in operation for more than two years.

Deposit Return Schemes are popular policy tools used in many countries to increase the recycling of single use drinks containers, improve the quality of recycling and reduce litter.

PET (polyethylene terephthalate) plastic bottles, steel and aluminium cans will be in scope for the DRS for England, Northern Ireland, Scotland and Wales. Glass will only be included in the Welsh and Scottish DRS system.

In 2021 when DRS was still in the consulting phase for the 3 nations, 60% of respondents supported a 20p deposit however, the exact fee is yet to be decided by the deposit management organisation (DMO), who will be announced next year.

DRS in England, Northern Ireland and Wales had the initial introduction deadline of 2023 however, following global events and a period of turbulence in government the consultation response outlined a new timeline for DRS with a deadline for implementation of October 2025.

Key decisions from the response:

• Announcement of a new implementation timeline which now has a deadline of 1 October 2025. 2 years later than the initial deadline.
• Producers are defined as brand owners, manufacturers or importers of in scope materials.
• Retailers who sell in-scope containers to the consumer will only be obligated under the DRS when placing own brand products onto the market however they will be required to, where possible, host take-back points. They will be issued a handling fee to compensate them for costs incurred in hosting a return point.
• Glass bottles will be included only in the Scottish and Welsh DRS systems as well as PET bottles, and aluminium and steel cans. Whereas in England and Northern Ireland, the DRS will not include glass.
• Like the Scottish DRS, containers from 50ml-3L will be in scope for DRS for England, Northern Ireland and Wales.
• Producers of in-scope materials will be obligated to label their containers as being included in the DRS as well as having a QR or bar code to enable the container to be recognised at the return point. The details and design of these markings will be left to the DMO(s) to decide.
• The DMO(s) will be appointed through an application process set out in the regulations rather than a competitive tender process and will be made up of one or several organisations.
• The DMO(s) are due to be announced by Spring of 2024. They are expected to be made up of a consortium of retailers, producers and the wider industry. The DMO(s) will be responsible for managing the overall operation of the scheme as well as meeting the collection targets set out in the regulations.
• Producers will be charged a registration fee to fund the management of the scheme, the fee will be proportionate to amount of and types of material as well as the size and turnover of the producer.
• Additional costs will be covered by the sales of secondary materials to reprocessors and unredeemed deposits.

Extended Producer Responsibility and DRS

• Producers of in scope DRS materials will still be required to purchase PRNs/PERNs until the first full year of operation of the deposit return schemes.
• During the intervening period between the implementation of EPR and DRS, producers of in-scope DRS materials will not be obligated to pay Local Authority waste management fees for that material.
• DRS containers (England, Wales, Northern Ireland) must be reported separately as part of EPR producer reporting but are not subject to Local Authority waste management fees.
• Glass drink containers in England and Northern Ireland must also be reported separately but are subject to full EPR costs (PRN and disposal costs).
• Any DRS drinks containers (inc. glass) supplied in Scotland are excluded from EPR reporting.

Next steps

Defra will look to engage with the industry to set up the DMO(s) and begin the application process, they will also begin drafting the necessary statutory instruments to seek mandate for the legislation. Additional work will be done to ensure alignment with the Scottish DRS.

The response touched on the possibility of a digital DRS however, Defra acknowledged that this technology is still in its early stages and not yet ready to be rolled out.

Martin Trigg-Knight, Director of Compliance Services, Clarity Environmental commented:

“Clarity welcomes the additional information around the DRS(s) and how it will affect the wider market. The government response largely echoes their pragmatic approach to the implementation of other policies that will work in tandem with DRS, such as Extended Producer Responsibility.

Despite the two-year delay, it is positive to see Defra taking a thorough approach in their design of the policy and allowing ample time for businesses to prepare for this major reform.”

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