Bid to sue Scottish Government for £160m over failed deposit return scheme given go-ahead

The Scottish Government is facing a £160m lawsuit over the failed deposit return scheme after a judge ruled a waste management firm’s case can proceed.

Lord Clark ruled Biffa Waste Services Limited’s case against the Scottish Ministers can go ahead as the firm seeks damages.

The business decided to go to Scotland’s highest court, the Court of Session in Edinburgh, because it believes the SNP government is responsible for it incurring a £150m loss.

Biffa is seeking compensation for the cash it invested in the collapsed scheme and the subsequent loss of profit.

The firm believes the Scottish Government misrepresented the scheme when it assured Biffa it would go ahead.

The scheme would have seen shoppers charged a deposit when buying drinks in cans and bottles, which would be repaid to them when empty containers were returned.

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.

The scheme was axed after the UK Government declined a request for full exclusion from the Internal Market Act, which meant Scotland could not include glass in the scheme.

Slater served as minister for green skills, circular economy and biodiversity in the government from 2021 to 2024.

Gerry Moynihan KC, representing the Scottish Government, repeated calls at a hearing last year for the case to be dismissed.

However, Lord Clark ruled on Tuesday that the case will proceed to a proof before answers hearing.

He said: “On the first part of the claim, for the pursuer to succeed at the proof the court will have to be satisfied on the following points: there was an assumption of responsibility; the duty was not inconsistent with the statutory powers and duties of the defenders; the pursuer relied, and reasonably relied, upon the defenders’ conduct; the breaches of duty occurred; and the loss was caused by the alleged breaches.

“On the alternative case on negligent misrepresentation, the pursuer mainly requires to prove that the pursuer’s contention on the proper interpretation of the letter, when viewed in its full context, is correct, and that the pursuer relied, and reasonably relied, upon it, causing the loss of costs.

“Questions also remain in play about the amount of loss on costs and profit which the pursuer can establish.”

A Scottish Government spokesperson said it cannot comment on live litigation.