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I do not recognise the member’s assertion about the cost being 40p. That is not a number that I recognise. Under the scheme, the cost is 20p, and people will get that 20p back.

With regard to consumer behaviour, we do not think that there will be extensive format switching from small units to large units in order to reduce any perceived mark-up in the deposit. As I have noted repeatedly, the deposit is fully refundable. Retailers are required to display information that tells people that the deposit is refundable.

There are many other deciding factors for consumers, including practicality, convenience, brand preference and the presentation of the product. Evidence suggests that, where product or format switching has occurred in other countries that have a DRS, it is rare that it can be attributed only to the DRS. Therefore, we think that there will be only a limited impact in that respect.

Are you referring to concerns of small retailers or concerns of small producers? One group will be in receipt of fees and the other will pay the fees.

I will give my view and then hand over to Euan, who is the expert on this.

The resources and waste common framework has worked well. For example, we used it last year to get the exclusion that we needed for the single-use plastics ban. Provided that the framework is used as intended, I think that it works well. The question on the table is whether UK ministers will break that agreement.

As the convener knows, the pattern of land ownership in Scotland is such that it is largely in private hands, and private landowners have the right to manage their land as they see fit. It is for the Scottish Government to use incentives and guidelines to try to ensure that land is managed in the best way possible and in pursuit of Scottish Government goals, but the use of privately owned land is, of course, the concern of the person who owns it.

The communications between Circularity Scotland, SEPA and businesses are under way and on-going. I think that some of the frustration results from things that are being reported in the media, including the press, which are simply not accurate. The correct way to get the right information that businesses need is to go directly to Circularity Scotland, and we are signposting people to that organisation.

Circularity Scotland is employing a communications expert to support the communications with businesses. It has held workshops throughout the country with businesses to help them to understand their role in the scheme, it has an excellent website, and it has call handlers who can answer phone calls and emails at all hours of the day and night. I recommend that any businesses that are not clear about their role should, instead of reading something on Twitter, get in contact with Circularity Scotland to get the right information that they need.

Whenever the public are asked about such schemes, they are always very enthusiastic about them. Generally, such schemes have broad public support. Schemes like ours work very well in other countries. They are very straightforward and well understood. In fact, people in this country are often nostalgic. They have memories of similar schemes that ran when they were young in which they returned their bottles to get their money back.

When someone buys bottles or cans, the cost of 20p is added to each bottle or can. People can, of course, get that money back when they return those materials. Therefore, there is a net neutral cost to the consumer when they purchase those materials.

The final date by which SEPA needs to receive completed registrations is 30 June 2023—registrations must be completed by that date.

I encourage all producers to start their registration before then, because the registration process is reasonably detailed. Producers have to enter all their products, the details of their barcodes and so on, and SEPA needs time to process the applications and publish the register of producers before the scheme goes live on 16 August. Retailers need to know which products they can continue to carry by 16 August. Therefore, SEPA needs to publish a list that shows all the producers that can continue to sell in Scotland, to ensure that retailers comply with the legislation.

SEPA has said that it will be very pragmatic in how it implements that, and I support that, because we want to ensure that businesses are on a pathway to compliance. I said that we are looking at how we can bring on board small producers who have not yet registered, and one thing that we are in discussions about in relation to that is working out what the pathway to compliance will look like for each business.

Each business is quite different and has different requirements and barriers, and we do not intend to be punitive or come after businesses—that is not the idea. The idea is to support businesses to comply with the scheme, because we want businesses to continue to be able to sell in Scotland, and we want them to understand their obligations under the scheme, and, in fact, to take advantage of it. Clearly, for businesses that are registered with the scheme and can continue to be stocked, that will be a competitive advantage.

The member has asked some really good questions. Circularity Scotland is a membership-based not-for-profit company. Its members include trade associations that are associated with small convenience stores, such as the Association of Convenience Stores, the National Federation of Retail Newsagents and the Scottish Grocers Federation—so they not only have a direct line to the information; they are also influencing Circularity Scotland’s decision making. The mechanism by which Circularity Scotland interacts with convenience stores is through their membership of those trade associations.

I meet those associations—and the Scottish Grocers Federation in particular—regularly and they have flagged up two categories of concern. First, they have emphasised that they want their members to participate in the scheme. They consider it a matter of footfall: where small grocers participate in the scheme, people will come through their doors, which is exactly what they want. They have asked me to help them to be involved in the scheme, and they are very supportive of it.

Secondly, some small businesses, particularly tiny ones, were concerned about their lack of storage space. Bakeries that sell bottled juice were also concerned, as you cannot have broken glass in a bakery. As the member pointed out, there are exemptions for such situations.

Let me give the high-level picture so that everybody understands. If you sell bottles and/or cans of juice, wine or anything else in Scotland, you have three options: you can choose to be a manual return point; you can choose to have an automated return point, which means installing a reverse vending machine; or, if it is applicable to you, you can choose to be exempt.

The grounds for exemption are proximity. For example, if several small stores are close together but a big store is nearby, the small stores might decide that they are not up for being return points and they can ask the big store to take their returns. Equally, they might decide that they want to work together to be a return point so they might pull together and get one reverse vending machine between them.

There are different models and it is up to each business to decide how it wants to proceed. If a business wants to be a return point, it can be a manual return point. That is the most cost-effective model if the business is collecting small amounts. That is probably what a convenience store would do. If a store has a small floor area, it might not have room for a reverse vending machine and it might not have high sale numbers of those products, so it would take them back as returns. In that case, customers would hand their bottles and cans over the counter.

The reverse vending machine infrastructure is probably most appropriate for bigger stores that not only have the space for them but the capital to do the up-front installations and the resource to do the administration of getting planning permission and all the things that go with that.

It is likely that big stores will have the reverse vending machines, small stores will have manual return points and other businesses that apply for an exemption—that is, small businesses or businesses with bakeries in them and so on—will be exempt.

On how we will know, we are the point at which it is with businesses to make their applications. Return point applications are open, so businesses can look at the evidence and decide what to do. Once the period of applications for return points is complete, we will have a picture of how many we have in Scotland and will know the mix—how many are manual and how many are RVMs. Then, knowing how much volume of material there is, we will be able to estimate how many will go to each point.

That will allow Biffa to work out its logistics. If there are more return points, that means fewer items per return point, whereas fewer return points means more items. Working out the logistics depends on exactly how many businesses sign up, where they are and what their volumes are, so it is an iterative process whereby we see what businesses have signed up.

I hope that I have answered the question. I might have drifted off a bit.

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—