Lorna Slater, the circular economy minister, appears determined to press ahead with a scheme to recycle drinks bottles and cans, in defiance of calls for it to be delayed.

Industry leaders have joined a chorus of opposition to the Scottish Government’s plan to introduce a deposit return scheme next year, arguing that it is too complex and expensive to operate.

An open letter, signed by 522 industry figures, calls on Ms Slater to postpone the project which is due to begin next August.

They include pub landlords, restaurateurs, retailers, brewers and distillers and many remain unaware or unclear about what they are required to do.

But a spokesperson for the Scottish Government said the scheme is “a vital part of our plans to create a circular economy.

“It will cut climate emissions, tackle littering, and directly address public concerns about the impact of plastic and other waste on our environment.

“The deposit return scheme is an example of producer responsibility and, rightly, places the cost burden on producers to deal with the bottles and cans they place on the market at end-of-life.

“Similar schemes have already proven successful in many European countries.” 

Signatories to the letter want the Government to work with the sector to design a “sustainable system that will function successfully for producers, hospitality businesses and consumers, whilst positively reducing the carbon footprint.”

There is also concern that if Scotland goes it alone with its DRS it would introduce different recycling schemes north and south of the border. The letter has been copied to Philip Dunne, chairman of Westminster’s environmental audit committee.

Under the current proposals, consumers would be charged a refundable 20p deposit by retailers in Scotland when they buy any glass, plastic, or metal drinks bottle, can, or other container that holds between 50 millilitres and three litres.

There are 35,000 collection points, including shops, online retailers, or reverse vending machines (RVMs).

The letter points to what the industry regards as a number of flaws in the scheme:

● Fraud: the obligation to take back empty containers will make legitimate online sales unviable, creating shadow-market websites that will ignore the rules;

● Booze trips: the Scottish Beer & Pub Association estimates that multipacks will be 50% cheaper in the North of England than in the South of Scotland if the DRS is introduced, leading to lost sales;

● Lost investment: if Scotland introduces a DRS on its own then it would end the single UK market, creating a higher administrative burden for businesses operating in Scotland, and leading to cross-border companies choosing to invest in their operations in the rest of the UK instead of Scotland;

● Local councils: the DRS would stop consumers putting their containers in their local councils’ kerbside recycling bins and boxes, affecting the financial viability of waste collection contracts and throwing optimised bin lorry routes into doubt, which could potentially increase carbon dioxide emissions for collections.

Last week the Society for Independent Brewers urged the government to review the proposal, arguing that it threatened the survival of small breweries and the Association of Convenience Stores (ACS) has previously called for a delay and greater clarification.

Marc Crothall, chief executive of the Scottish Tourism Alliance, said: “It is evident from the number of signatories to this letter from business’ large and small across Scotland that the DRS being proposed in the current timescale and in its current form could be the death knell for many tourism and hospitality businesses and small retailers too.”

Blair Bowman, the whisky consultant and broker who organised the letter, added: “If we’re to avoid the catastrophic impact of the DRS then Lorna Slater needs to press pause now, and meet with our industries and the UK Government to come up with a sustainable solution that will benefit people and the planet.”

He said some companies are not even aware that the scheme is coming because there has been little communication from the Scottish Government.

“It’s like the UK Government’s mishandling of Brexit rule changes all over again,” he said.

On Monday the government said that thousands of smaller retailers will be able to opt out. Under new guidance, exemptions are likely to take place for retailers below 25 sq m, which would see them automatically excluded on application.

Additionally, this could see retailers below 100 sq m and food-to-go retailers under 280 sq m likely be excluded on environmental health grounds.

A spokesman for Circularity Scotland told The Grocer: “The new guidance will make the process of applying for exemptions clearer, easier and quicker for retailers and will significantly reduce the operational burden of the scheme for a large number of hard-pressed smaller retail outlets in these particularly challenging times.”

ACS chief executive, James Lowman who has described the new guidance as a “step forward” is now urging the rest of the UK to follow on.

He said: “The UK, Welsh and Northern Ireland governments should note the challenges that Scotland is experiencing in using an exemptions system to define a workable and economically viable network of return points.”

In May the Scottish National Investment Bank injected £9m into Circularity Scotland, the body set up to administer the country’s deposit return scheme (DRS) for drinks containers.

The investment by SNIB was crucial to securing an additional £9m in capital from Bank of Scotland.

The funds raised will support the start-up costs of the administrator for the DRS.

The investment was welcomed by trade body the Federation of Independent Retailers.