Scottish Government facing £166m court case over collapse of recycling scheme

A waste firm is attempting to sue the Scottish Government over the collapse of its bottle return scheme in 2023.

Biffa is pursuing a £166m compensation claim over a decision made by ministers to delay the introduction of the deposit return scheme in 2023.

After a bid by the government to have the case thrown out was rejected by the court earlier this year, the case is now due to be heard at the Court of Session and is expected to last around eight days.

Who is suing the Government?

Biffa Waste Services Limited is seeking compensation from the Scottish Government for the cash it invested in the collapsed scheme.

The waste firm believes the Holyrood government is responsible for it incurring a multi-million pound loss.

The company is said to have relied on personal assurances from Green Party co-leader Lorna Slater as a reason to invest £55m in vehicles and equipment to prepare for the DRS, before she scrapped it in June 2023.

Biffa wants compensation for the cash it invested and the subsequent loss of profit.

What was the deposit return scheme?

The Scottish Government’s deposit return scheme would have seen shoppers charged a deposit when buying drinks in cans and bottles, which would have been repaid when the empty containers were returned.

It was a key policy of the former SNP-Green administration.

Under the plans, a 20p deposit was to be added to all single-use drinks containers made of PET plastic, metal or glass. Consumers could reclaim the deposit by returning the containers to retailers or to specially-designed reverse vending machines.

It was due to be introduced in August 2023 but the launch date was pushed back, with then first minister Humza Yousaf citing concerns from businesses.

The Conservative government at Westminster refused to grant the scheme the go-ahead unless it conformed to a UK-wide approach which excluded glass.

In June 2023, Slater said she had no choice but to delay the scheme until at least October 2025, accusing the UK government of sabotage.

She left government last year following the collapse of the Green-SNP power-sharing agreement.

What are the arguments?

Biffa believes the Scottish Government “negligently misrepresented the assurance it gave” to the waste firm.

The company cited a letter sent by Slater in May 2022, reinforcing the government’s commitment to the plans.

Biffa said it signed its contract with Circularity Scotland as a “direct” result of the letter, and in the belief that ministers had “taken all necessary steps” to ensure that it would be deliverable.

At the proceedings last year, the Scottish Government’s lawyer, Gerry Moynihan KC, said Scottish Ministers acted lawfully.

He said the letter sent by Slater did not amount to a “negligent representation”.

Scottish ministers have also claimed the waste firm was aware of the risks involved.

Scottish Conservative MSP Maurice Golden said: “The Deposit Return Scheme was a costly shambles that summed up the SNP’s coalition of chaos with the Scottish Greens.

“If the courts agree that Ms Slater breached the assurances she gave and caused Biffa’s losses, Scottish taxpayers face a huge compensation bill for SNP/Green incompetence.”

The case will be heard at the Court of Session starting on Tuesday.