Energy and Environment

A plastic bottle deposit scheme is an expensive way to achieve very little

In March 2018, Michael Gove announced a plastic bottle deposit scheme in a bid to reduce plastic pollution, and like a lot of people, I was quite excited. Plastic pollution was high on the agenda; with David Attenborough’s warnings about albatrosses ingesting plastic ringing in our ears and images of a seahorse clinging to a cotton bud flashing across the internet, how could we not be worried?

I was particularly keen on a bottle deposit scheme because I’d heard good things. My brother returned from a year living in Germany waxing lyrical about their Deposit Return Scheme (DRS), under which every bottle he returned meant 22p back in his pocket.

He also said the scheme encouraged people to take responsibility for their waste, even the non-plastic items, by embedding recycling in the psyche. Surely, I thought, a similar scheme in Britain would be fantastic, with people flocking to recycle some of the estimated 13bn plastic drinks bottles we use such year.

And you can see why Gove is so keen on the scheme. With Theresa May forced to abandon half her agenda following the disastrous 2017 election, the government paralysed by Brexit and young people bunking off what seems like every other Friday to protest against climate change, here was an opportunity to boost the Conservative Party’s environmental credentials and show that the government can still act on voter’s concerns.

But nice, headline-friendly ideas do not necessarily make for successful policy. That’s why Chris Snowdon, the IEA’s Head of Lifestyle Economics, has published new analysis which looks into the scheme – and his conclusions make for uncomfortable reading for its advocates.

The scheme proposes a small deposit – ten or twenty pence – for drinks sold in disposable cans and bottles, which can be reclaimed when the containers are returned to a reverse vending machine.

My brother’s instincts were right. In Germany, which introduced its DRS in 2003, an estimated 97% of PET plastic, metal, and glass containers are recycled. But parts of the United States, Canada, and Australia have similar, or lower, recovery rates than the UK, despite having already implemented a DRS, so success is not guaranteed.

The most successful schemes – those found in Sweden and Norway – have one key difference to the UK’s situation, which is that their schemes have not been introduced on top of existing kerbside collection.

In the UK, 72% of drinks containers are already recycled by households, largely via regular waste collections, while countries which have a DRS recycle an average of 87%. So the scheme may well improve Britain’s recycling rates, but is it worth it?

The Government’s impact assessment for the scheme estimates that setting up the DRS will cost over £1bn to set up and over £800m per year to run thereafter. On top of that, there is the cost to households of collecting and storing the empty containers, taking them to the nearest collection point, dropping them off, collecting the voucher, and then queuing somewhere else to claim the cash back.

The Government’s analysis neglects to calculate this cost, but the IEA research estimates that if it added just five minutes on to a household’s weekly chores, the financial impact would equate to £1.7bn in unpaid labour. That takes the scheme’s running costs to over £2.5bn.

And what are we getting back for our unpaid labour? According to the Government, income from the sale of the recycled materials and the savings local councils will make on reduced litter collections. Both unequivocally good things but, at £37m and £50m respectively, hardly enough to justify the enormous start-up and running costs of a DRS.

The truth is, Britain is already pretty good at recycling at home. It is the 15% of plastic and 30% of canned drinks bought outside the home and consumed on the go that the Government needs to target and officials could do this much more easily and cheaply by introducing more outdoor and high-street recycling bins, rather than take up valuable floor space in supermarkets by rolling out costly DRS machines.

Recycling is good and litter is bad, but that doesn’t mean every scheme aimed at boosting the former and reducing the latter should be implemented. Good intentions cannot be the sole driver of policy and ultimately the UK’s proposed deposit recovery scheme seems like an expensive way of achieving very little.


This article was first published on CapX.

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