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All return points use the same process. Hospitality falls into two categories. I am sorry, but this is about to get horribly technical. There is closed-loop hospitality and open-loop hospitality. If you go to a small cafe, such as the local Greggs, for your sausage roll and bottled juice, you will take that bottle away. That is an open loop. Under the scheme, because customers take bottles away from that business, it is an open loop and it is obliged to be a return point unless it is exempt. A small cafe or Greggs bakery, for example, have probably got very clear grounds for exemption because it cannot have broken glass on the premises. It would probably apply for exemption on health and safety grounds, meaning that it would not operate as a return point.

Equally, it might be that the small bakery is in a parade of shops that has a larger convenience store at the end, so it might decide to ask the convenience store to take its returns. It would then get an exemption on the basis that there is a return point within the same parade of shops. It is for those businesses to make the right choice for themselves.

Closed-loop venues are the other type of hospitality venue. For example, you might be at a restaurant and order a bottle of wine with your dinner. You would not take that bottle away with you when you leave the venue, however much you might wish to. That bottle will not incur a deposit, because you will not take it away. However, the venue will have paid a deposit when buying the bottle from its wholesaler, so it will need to get its deposit back. It will do that through a closed-loop system. For that system, Biffa will collect materials separately. That process does not affect the consumer.

We are starting to get into technical matters, but those are two different ways in which hospitality venues can manage the process.

No, that is not right. Closed-loop hospitality venues are not return points. A restaurant that serves drinks to customers at their table and does not give them the bottles to take away is not obliged to be a return point, whereas a cafe or small bakery—

It is common for both local shops and the big shops to take returns, so that consumers can decide where they want to make returns.

I do not agree with the member’s representation that small businesses will be disproportionately impacted. The measures that we have put in place have been designed to support small producers in particular. I can go through them again. One of the measures that we have put in place to support small producers is proportionate producer fees, so that small producers will pay the same as large producers, proportionally, because the fee is charged per container. There are, similarly, cash flow measures specifically to help small producers.

When it comes to our small retailers, the fees that will be paid for operating manual return points are the highest in the world for small retailers: our small retailers who operate manual return points will be better off than their compatriots around the world. With our scheme, we are doing more for small businesses than other highly successful schemes around the world are doing. Therefore, I do not agree at all with the member’s representation of the scheme.

Absolutely. The scheme, as it will look on 16 August, will probably look quite different 18 months down the line. When these sorts of schemes launch, there is a first stage—what we call the cut-over period—that is always challenging. In this case, most of what you have in your house, most of the litter in the streets and so on will not at that point be scheme articles. If, after 16 August, you do your citizen’s duty by picking up a can at the side of the road and taking it to a return point, the can will be rejected. It will not be a scheme article because it was sold before the date.

During the cut-over period, some scheme articles will be in circulation; however, quite a lot of material that is not scheme articles will be in circulation, too, and it will take a number of weeks for scheme articles to become predominant. A big part of what we have to manage, therefore, is the ramp-up into the scheme. There are tried and tested ways of doing that, and there are learnings that we can take from other countries. It will be a challenging period, and our communications to consumers must be clear so that customers understand why the bottle that they bought on 17 August can be returned whereas the one that they bought on 15 August cannot.

That is definitely challenging for us to manage, because we all want people’s first experience of the scheme to be a positive one. We want them to have their bottle accepted, to get their 20p back and to spend that on their shopping or whatever they wish. The cut-over period will be absolutely critical.

Moreover, as those materials gradually ramp up, we will be able to see consumer behaviour. It goes back to the convener’s earlier point: does the consumer tend to bring things back to the big shops, or do they use a mix of small and large shops? How does it work? Biffa and Circularity Scotland will have to be very reactive and dynamic, and we will be working with them on processes and mechanisms that will allow them to deal with any small business that says, “Oh my goodness—my bins are full! Biffa, come and get them,” and to be able to update things so that people can say, “Do you know what? I thought that we were going to get 10,000 items a week back, but we’re getting only 3,000. We need to adjust our schedule.”

There will have to be a period of adjustment and optimisation as the scheme settles in, and, as a result, I would expect what you have suggested to be the case. I expect that communities will tell us, “We have no return point that’s convenient for us. How can we get things collected?” We will have to be dynamic in addressing those sorts of issues. It is my intention, therefore, to facilitate some sort of reaction force so that people and businesses know whom to call when their bins are overflowing or they cannot return things and so that there is a process by which people can find out how to get their 20p back.

The scheme will ramp up and adapt to things over the first year. In fact, the recycling targets that we have set will come into effect after a year—or perhaps two years; I will see whether that needs to be corrected—in recognition of the fact that we will not have 90 per cent recycling on day 1. As the scheme beds in, we will work towards that 90 per cent recycling target.

I actually think that the problem is largely because of misunderstanding of what the scheme is and how it operates. The scheme is moving toward launch, and we have that big milestone of 95 per cent of the market, by volume, being signed up to the scheme.

The scheme is a producer responsibility scheme. That means that producers of the materials that we are collecting—the people who profit from those materials—need to ante up. They need to put it on the line and say, “Yes, we are now going to be responsible for collecting the materials, sorting them, and making sure that they are recycled properly.” That is a big shift, from using public money to do that work to putting it back on the producers. Producers that produce an enormous market volume—as I have said, it represents 95 per cent of the market—have signed on the dotted line and said, “Yes, we’re stepping up.” That is a huge milestone.

The next significant milestone is getting the return points signed up. Once Circularity Scotland and Biffa know where the return points are and how many items they expect from each return point, they can finalise their collection schedules. Circularity Scotland and Biffa are working towards the 16 August launch date.

All those pieces of the puzzle are under way. That is what we need to get the scheme launched. I know that there are still concerns among some small producers about how they participate in the scheme. We are working with them, the Scottish Environment Protection Agency and Circularity Scotland to bring them on board so that they can continue to supply the Scottish market.

That would be required to extend the deadline. However, late applications are being accepted. That has not been a hard cut-off. Businesses can still apply, and they continue to do so.

They need to register, but they can go through the process to get those labels. It was identified that redesigning packaging on the timescale given was a barrier to businesses, and Circularity Scotland came up with that really practical labelling solution so that that is no longer a barrier.

We are looking at what else we need to do with regard to the producers who have not signed up. Do they understand the package of measures that are on the table? I know that the committee took evidence from—

That is how such schemes normally work. It is the case that return points need to take bottles back and store them until they are collected. I understand that, when a retailer registers to be a return point, it enters information on how many returns it expects to receive and how much storage space it has. That allows Biffa to put in its schedule how often materials need to be collected. That is normal for retailers. They will need to be able to store materials until they can be collected.

When items are returned, they need to be stored until they can be collected. Businesses already have storage space for various recycling materials and packaging materials. What is proposed is very similar to that. It is up to each business to figure out how it can store the materials. Unless they are exempt, businesses have an obligation to be a return point if they sell the materials. Biffa and Circularity Scotland are very happy to work with businesses to find out how that will work for them.

There is no particular rule about how businesses must store the returns. They could adapt to store them behind the counter, and I have seen versions that involve having designated wheelie bins in a secure area. There is a variety of ways to adapt storage space, and businesses can make the right decisions for them.