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Getty Images<\/p>\nPhil SimScotland political correspondent<\/p>\n
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It could have been a dry legal debate about drinks container recycling, business correspondence and intergovernmental procedures.<\/p>\n
But somehow the Biffa vs Scottish government case has been gripped by claims of sabotage, betrayal and secrecy.<\/p>\n
There have been allegations of incompetence, negligence, half-truths and misleading statements.<\/p>\n
It’s a tale of business and government, the economy and the environment, Holyrood and Westminster – and of how difficult it can be to do new things even when you’re in power.<\/p>\n
With judge Lord Sandison now considering his ruling, what have we learned from this case and the collapse of the deposit return scheme?<\/p>\n
Let’s deal with the specific claims made by Biffa in the first instance, before looking for wider lessons.<\/p>\n
The company’s \u00a351.4m lawsuit hinges on a letter from then-minister Lorna Slater in May 2022, voicing “unwavering” commitment to a deposit return scheme going live the following August.<\/p>\n
The plans aimed to boost recycling by charging consumers an extra 20p for a single-use bottle or can, which would be repaid when it was returned.<\/p>\n
Biffa was in talks to be the main logistics provider, and insists the letter from Slater was “foundational” in the decision to sign a contract and invest tens of millions of pounds.<\/p>\n
Crucially, the company notes there was no mention in this letter of any risks to the plans – and nothing about potential trouble with UK internal market rules.<\/p>\n
It was a row over those rules which ultimately saw the scheme collapse in 2023.<\/p>\n
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Lorna Slater was in charge of the deposit return scheme when she was in government<\/p>\n
The Internal Market Act – introduced post-Brexit to maintain free trade across the UK – meant Westminster would need to approve any plans creating different rules for businesses north and south of the border.<\/p>\n
Ultimately they only allowed a more limited version of the scheme, capping deposits and excluding glass, leading Scottish ministers to accuse Scottish Secretary Alister Jack of “sabotage”<\/a>.<\/p>\n Officials had been aware of the issue since late 2021, and it had been clear since March 2022 that they would need to make a fresh application to the UK government for an exemption.<\/p>\n Biffa says it was “disingenuous in the extreme” not to mention that in the letter – and was backed by Lord Jack, who said it was “utterly irresponsible” to encourage investment without mentioning the “huge level of risk”.<\/p>\n Slater said the letter was not a project update which would detail such risks, but was simply designed to reassure the firm that the government remained committed to the future of the scheme, having recently delayed the “go live” date by a year<\/a>.<\/p>\n The government maintains Biffa was not offered any special assurances, and in any case was well aware of the risks – to the extent it took out a \u00a320m insurance policy against delays.<\/p>\n Alister Jack was sharply critical of the Scottish government in his evidence to the court<\/p>\n Lord Sandison is pondering whether that letter was a negligent misrepresentation of the true situation and whether Scottish ministers had a duty to warn Biffa of potential risks.<\/p>\n He is expected to make a ruling in the new year but in the meantime there are broader lessons we can learn too.<\/p>\n Having come under the microscope in this case, the failure of the deposit return scheme is in many ways a case study in why it’s hard to do new things.<\/p>\n Lorna Slater told the court there were “many existential threats” to the plans.<\/p>\n The whole of the UK was moving in the direction of having deposit return systems but Scotland was set to go first – and thus was breaking new ground while puzzling out the practicalities.<\/p>\n Drinks producers would need to agree standard approaches to labelling and barcodes, and retailers would need to be knitted into a vast network of return points with connecting IT infrastructure.<\/p>\n An arm’s length body called Circularity Scotland was set up to administer the scheme. CEO David Harris told the court that parliament had essentially set a date at which the system would come into force, but countless questions were not addressed by the legislation.<\/p>\n How would new stock be phased in on the day the scheme went into force?<\/p>\n Would firms need to put different barcodes on stock heading to Scotland and England?<\/p>\n What about online sales? Would a supermarket delivering single-use containers to a customer have to come back to collect them?<\/p>\n There were governmental issues too around VAT – would a 20p deposit actually become 24p?<\/p>\n And then there was the threat of legal challenge hanging over matters. Many drinks providers and retailers had initially resisted the plans and some continued to push back.<\/p>\n Biffa had signed up to collect and process bottles and cans – and says it lost millions<\/p>\n This underlines the problem the government had with its relationship with business.<\/p>\n John Swinney nodded to a broader issue when he explicitly sought to reset that relationship on becoming first minister, drafting in deposit return critic Kate Forbes<\/a> as his deputy to smooth things over.<\/p>\n The partnership between Circularity Scotland and the government was frequently challenging, with Mr Harris saying he felt like a “middle-man” constantly under pressure from ministers and companies.<\/p>\n Worse, he told the court it was “alarming” that he hadn’t been told about internal market issues sooner – he only found out about them via a media inquiry in 2023 – and said “I feel the material facts were kept from us”.<\/p>\n Asked by Biffa’s lawyer whether he felt “betrayed”, he ultimately agreed.<\/p>\n The court also heard claims the government had “deliberately concealed” its concerns about the future of the scheme from the very companies investing in it.<\/p>\n A working group had been set up for partners involved in the new system, with a publicly-available register of potential risks to the plans.<\/p>\n Emails from spring 2022 saw one company boss asking whether a range of issues including internal market rules should be added to the shared risk register.<\/p>\n But civil servants discussed not doing this, because they had separately been threatened with legal action by a member of the Scottish Grocers’ Federation, which was part of the group.<\/p>\n Biffa’s lawyer said issues were being “kept secret” in an effort to “run down the clock” on a potential judicial review.<\/p>\n The civil servants involved said they were simply being careful about sharing the government’s legal assessment of a topic when they were being threatened with legal action, and they were backed in court by Slater.<\/p>\n But it underlines the fundamental tension in the relationship, and the level of trust between the government and what it called “potentially litigious partners”.<\/p>\n “Reverse vending machines” are commonplace in countries like Denmark which operate deposit return schemes<\/p>\n Relations were even worse when it came to the UK government.<\/p>\n![\"PA](\"https:\/\/www.newsbeep.com\/nz\/wp-content\/uploads\/2025\/11\/78f1c320-b659-11f0-aa13-0b0479f6f42a.jpg.webp.webp\")
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