A major Scottish recycling company stands on the brink of collapse after investing millions of pounds in the Scottish Government's ill-fated deposit return scheme, the Daily Mail can reveal.
Circularity Scotland, the not-for-profit company established to run the scheme, poured substantial resources into preparing for the initiative that was ultimately scrapped after Westminster refused to grant an exemption from UK-wide trading rules.
Businesses Left Counting the Cost
Industry sources confirm the company is now facing administration, leaving numerous businesses that invested heavily in the scheme facing significant financial losses. The failed initiative has created a domino effect across Scotland's recycling and manufacturing sectors.
The controversial scheme, championed by Green Minister Lorna Slater, would have seen consumers pay a 20p deposit on drinks containers, refundable when returned to collection points.
Political Fallout Intensifies
The collapse has sparked furious political repercussions, with opposition parties and business leaders questioning the Scottish Government's handling of the entire process. Many are now demanding answers about why businesses were encouraged to invest heavily in a scheme that lacked crucial approvals.
One industry insider told the Daily Mail: "Companies were led to believe this was a done deal. They've spent millions on equipment, infrastructure and planning, all for nothing. The financial impact is devastating."
What Went Wrong?
The scheme's failure stems from several critical issues:
- Westminster's refusal to grant an exemption from the UK Internal Market Act
- Concerns about creating trade barriers between Scotland and the rest of the UK
- Growing opposition from business groups about complexity and costs
- Political infighting between Scottish and UK governments
Scottish Conservative MSP Maurice Golden condemned the situation, stating: "This is a catastrophic failure of governance that has cost businesses millions. The SNP-Green government pressed ahead despite clear warning signs."
What Happens Next?
With Circularity Scotland likely to enter administration, attention now turns to:
- How businesses will recover their investments
- Whether any compensation will be available
- The future of recycling policy in Scotland
- Political accountability for the failed scheme
The Scottish Government maintains that it remains committed to implementing a deposit return scheme, but with the current model in tatters and businesses reeling from losses, the path forward appears increasingly uncertain.
