SUPPLEMENTARY MEMORANDUM BY INCPEN (DSW
Thank you for inviting INCPEN to give oral evidence.
We have noticed that other witnesses have also been asked questions
about packaging. In particular the Minister for the Environment
was asked last week about deposit/refund schemes for containers.
We appreciate that such schemes may seem like
an easy solution but in practice they are seldom efficient especially
for small items like packaging. Enclosed is a brief note on the
subject that we hope is helpful.
Mandatory deposits seem like an easy way to
encourage people to return containers but they are usually administratively
expensive, they are only feasible for a small proportion of the
products in the waste stream (drinks containers) and often have
There are three reasons why in some countries
a monetary deposit has been applied by law to a package:
1. As an anti-litter measure in the
hope that litterers will be encouraged to return a container rather
than litter it and forfeit the deposit.
2. To encourage the use of refillable
containers in the mistaken belief that refillable systems are
always environmentally preferable and, indeed, do not generate
3. To encourage the return of containers
Nine American States, three Canadian provinces
and one Australian State introduced mandatory deposit laws in
the 1970s. They aimed to reduce litter by requiring all beer and
soft drink containers to carry a deposit, refunded on return of
the container to the retail outlet that originally sold it.
They succeeded in reducing litter from drinks
containers (about 10 per cent of litter) but did nothing about
other littered items and in some instances, in New York for instance,
it led to an overall increase in litter.
It was thought that if all empty containers
carried a deposit, then even if they were littered, someone would
collect them and redeem the deposit. As expected, drinks containers
were collected from street and litter bins but the newspapers,
bus tickets and other discarded items that were emptied from the
bins, in the search for containers, were left to blow around the
In the US, faced with the requirement to take
back and pay a deposit on all containers, retailers quickly discovered
that it was easier to toss cans and plastic bottles in a sack
in the corner than place glass bottles carefully in stacked crates,
which took up much more space. The result was exactly the opposite
of the law's intentionglass bottles disappeared from the
The effective operation of refillable bottle
systems is not dependent on deposits. One of the most successful
systems over the years has been the British doorstep milk delivery
system and that works without a deposit.
Industry uses refillable, returnable systems
when they make environmental and economic sense. Refillable bottles
are still used in the pub trade, and there is increasing use of
reusable packaging for business-to-business use (for example,
collapsible crates are often used to ship components to an assembly
However, because refillable containers have
to be strong enough to withstand repeated journeys and fillings,
they are heavier and take up more space than single trip containers.
This means that they often use more resources and energy.
Choice of container system depends on a huge
range of technical, social and environmental considerations, including
the nature of the distribution systems used and consumer behaviour
and preferences. Small corner shops continued to stock refillable
soft drink bottles for many years after non-refillable bottles
and cans established a dominant share of the take-home trade,
but they went into decline because consumers rarely bought them
and when they did, they failed to return the emptiesdespite
the deposit. There is nothing more wasteful than a returnable
pack that does not get returned.
While mandatory deposits may be an effective
way of collecting drinks containers for recycling, their practicality
diminishes as the number of products covered increases. It is
not feasible to expect people to queue up to reclaim the deposit
on every item of recyclable packaging used in the home. Thus mandatory
deposits are unsuitable as a way of collecting products bought
in large quantities at great frequency.
If non-drinks packaging is to be recycledand
newspaperskerbside collection and bottle, can and paper
banks will still be needed. Mandatory deposits undermine the economics
of collecting other materials from the household, since without
the critical mass offered by drinks containers, the costs per
tonne collected is much higher. Thus mandatory deposits are inappropriate
as a collection mechanism since they single out used packaging
for certain products from similar packaging for other products.
Deposit system result in increased prices. They
cost more to run than industry can make from them through the
retention of unclaimed deposits and the value of the reclaimed
material, since they require extra non-revenue-generating activities
which build inefficiencies into distribution operations.
For retailers, the additional handling and sorting
costs and space requirement reduce the profitability of drinks
in relation to other products carried, which leads to lower prices
to the supplier as well as higher prices for the consumer. Retailers
tend to respond to the introduction of mandatory deposits by reducing
the shelf-space allocated to deposit-bearing products and the
number of varieties stocked, so the consumer also loses out through
restriction of choice.