Tennent's brewer says deposit return scheme change threatens jobs

The drinks' firm behind Tennent's lager has said the removal of glass from the deposit return scheme would put jobs and investment in Scotland at risk.

C&C Group has written to the first minister expressing "serious concerns" about the UK government's decision that any scheme must exclude glass.

The brewer says that would put Tennent's - typically sold in cans - at a significant competitive disadvantage.

The UK government argues that it has reacted to industry concerns.

First Minister Humza Yousaf said the decision could have a "disproportionate" impact on Scottish businesses.

C&C Group has requested an "urgent meeting" with Mr Yousaf to discuss its concerns.

Managing director Andrea Pozzi wrote: "This announcement increases the already huge uncertainty around the scheme for the drinks industry, customers, and consumers and, if implemented, would be a fundamental change to the scheme."

He also warned the partial exemption would have "serious implications".

Mr Pozzi added: "By removing glass from a Scottish DRS [deposit return scheme], Tennent's - as a product sold in can in the Scottish off-trade - would be at a significant competitive disadvantage, undermining our business and therefore placing jobs and investment in Scotland at risk."

As a result he vowed the brewer would have no alternative but to "actively seek and support a UK-wide scheme".

The British Soft Drinks Association, which represents brands including Irn Bru makers AG Barr, has also called for a UK-wide approach.

In a statement, it said that "surely the only viable option now is for all stakeholders to commit to launching a deposit return scheme across the UK on the same timeframe".

The Scottish government is considering whether or not to proceed with a Scotland-only scheme in March 2024. Its decision is expected early next week.

To allow the scheme to operate effectively, ministers sought a full exemption from the rules of the UK Internal Market Act.

UK ministers have granted a partial exemption - on condition that the Scottish scheme excludes glass and matches plans for deposit return in other parts of the UK.

In effect, the Scottish government is being permitted to pilot what should eventually become a UK-wide approach, rather than proceeding with its own distinctive proposals.

Scottish ministers have accused the UK of "deliberate sabotage" and interference in devolved decision-making.

The UK government insists that it is responding to the concerns of business and avoiding unnecessary costs and complexity.

Mr Yousaf told the BBC that the UK government had effectively said it was "their way or the highway".

"The problem with their way is that it could have a disproportionate impact on Scottish businesses - iconic brands like Irn Bru, like Tennent's," said the first minister.

"They could be disproportionately impacted because of the UK government's actions.

"So we've got to take a choice. Do we do that, or I'm afraid do we not have a scheme because it simply will not be viable without punishing Scottish business. And that's a very stark decision and choice we have to come to."

Circular Economy Minister Lorna Slater said C&C Group's letter showed the "recklessness" of the UK government's decision to remove glass and called for it to be reversed.

She added: "Including plastic, metal and glass is best for the environment and maximises the economic benefits, too."

But the UK government said the drinks industry had raised concerns about the Scottish government's scheme differing from plans in the rest of the UK.

A spokesperson said: "We have listened to these concerns and that is why we have accepted the Scottish government's request for a UK Internal Market exclusion on a temporary and limited basis to ensure the Scottish government's scheme aligns with planned schemes for the rest of the UK.

"Deposit return schemes need to be consistent across the UK and this is the best way to provide a simple and effective system.

"A system with the same rules for the whole UK will increase recycling collection rates and reduce litter - as well as minimise disruption to the drinks industry and ensure simplicity for consumers."