The Welsh Government will create a deposit return scheme for Wales, after pulling out of a UK-wide approach which did not include glass bottles, it has announced.

England, Wales, Scotland and Northern Ireland had been working towards a long-planned scheme for drinks containers, which was due to come into force in October 2027.

Under the plan, which the UK Government’s Department for Environment, Food & Rural Affairs (Defra) has been developing since 2017, consumers would recoup a small deposit when returning single-use bottles and cans.

Wales already ranked second in the world for recycling, it places us in a unique position of implementing a scheme into an already high recycling nation

The scheme had faced heavy criticism from some in the drinks industry, with discrepancies between devolved administrations over whether glass bottles would be included also complicating the roll-out.

However, a joint process between the UK Government and the devolved governments to appoint the deposit management organisation for the respective schemes was due to take place later this month.

But on Monday afternoon, Huw Irranca-Davies, deputy First Minister of Wales, issued a statement confirming that Wales was “not able to proceed with the joint process”.

He said issues were due to the United Kingdom Internal Market Act 2020, which was “inherited by the UK Government” from the previous Conservative administration.

His written statement added: “Wales already ranked second in the world for recycling, it places us in a unique position of implementing a scheme into an already high recycling nation.

“That means that to develop a DRS that will deliver benefit to Wales necessitates an approach which looks beyond recycling; one that will support Wales to build on our progress to date and take the next step by supporting the transition to reuse.

“Recognising the effort that everyone across Wales has put into our progress on recycling, it also means that it is vital that the introduction of a DRS will build upon and not detract from the progress everyone has worked so hard to deliver.”

Under the scheme, shoppers pay a deposit when buying a single-use container.

This deposit is then paid back when the product is returned, for example back to a shop counter or to a reverse vending machine.

Earlier this month, the UK Government confirmed that it would not include glass in the scheme.

The Welsh Government had always maintained that glass would be part of its deposit return scheme.

Mr Irranca-Davies said it had “not been possible to address the issues to the operation of devolution” from the Internal Market Act 2020 within the time available.

“This unfortunately means that we are not able to proceed with the joint process or notify the WTO (World Trade Organisation) in relation to the scheme at this point,” he stated.

It is not clear exactly when the Welsh scheme would come into effect, though ministers hope it would be brought into the next legislative term in the Senedd, which begins in May 2026.

Mr Irranca-Davies said plans for Wales would focus on supporting the country’s transition to a circular economy, moving to reusing rather than recycling containers.

He added: “Our active engagement with industry has highlighted that there are currently a range of views on how best to achieve the transition to reuse.

“We will therefore continue our active engagement to develop a scheme that supports the transition to reuse for all drinks containers including those made from glass.

Welsh Labour need to reconsider their decision and honour the agreement they made with the four UK nations

“In doing so we will also continue to draw from international best practice.

“In parallel with the development of the Welsh DRS, we will also continue our work to improve our recycling, having once again seen an increase in our latest recycling rates this year.”

Each year, consumers in the UK go through an estimated 14 billion plastic drinks bottles and nine billion drinks cans.

Current recycling rates in the UK for containers in scope of the return scheme are around 70%, leaving approximately four billion plastic bottles, 2.7 billion cans and 1.5 billion glass bottles not recycled each year.

Deposit return schemes are used in other countries across the world, including Germany, Finland and Norway which have recycling rates above 90%.

There are reportedly 56 deposit return schemes operating internationally, with 49 of these said to include glass.

In response to the Welsh Government’s announcement, the Welsh Conservatives called for ministers to reconsider.

Janet Finch-Saunders, shadow climate change minister, said: “With thousands crossing the Welsh – English border on a daily basis, 16 million people living within 50 miles of the border in England and Wales, and trade between both countries fluid, it is essential that we have the same Deposit Return Scheme.

“The Welsh Conservatives have been calling for the implementation of a DRS since 2016, taking inspiration from schemes around the world.

“Welsh Labour need to reconsider their decision and honour the agreement they made with the four UK nations.”

Gavin Partington, director general of the British Soft Drinks Association, said: “We regret the Welsh Government’s decision which undermines efforts to deliver an aligned Deposit Return Scheme across the UK and help the move towards a circular economy.”

He said the group remained committed to a deposit return scheme for cans and polyethylene terephthalate (PET) and would continue to work with governments to deliver this by October 2027.

James Lowman, chief executive of the Association of Convenience Stores, said it was “extremely concerned” that the Welsh Government was taking a different approach.

He added: “A unified approach across the UK is best for consumers, retailers and producers, and has the best chance of achieving meaningful change in recycling rates.

“The Welsh Government’s separate approach will be confusing for everyone involved and disruptive to the delivery of DRS for the other UK nations.”

A spokesman for the UK Government said it was “committed to delivering” the scheme across England, Northern Ireland and Scotland, and it will go live in October 2027.

He said: “We will continue to work collaboratively with the devolved governments and industry to ensure our scheme works for businesses and consumers, while creating thousands of green jobs, driving investment into new infrastructure and moving towards a circular economy.”

A spokesperson from the Natural Source Waters Association said: “We are deeply disappointed by the Welsh Government’s decision to withdraw from the four-nation approach to delivering an aligned Deposit Return Scheme across the UK.

“This decision will significantly weaken the impact of the introduction of DRS on tackling litter and promoting a circular economy, both across the UK and in Wales.

“Moreover, it will create cross border issues for the scheme: confusion and frustration among consumers, the risk of fraud, and uncertainty for producers and retailers.

“However, we remain committed to a DRS for cans and PET plastic bottles established by October 2027 and will continue to work with governments to achieve this.”