'Serious concerns' over lack of transparency regarding private firm set up to run Re-turn scheme

The board of the company is dominated by representatives of the beverage industry, and the way it was established is 'bizarre', a Social Democrats TD has said

A Social Democrats TD has criticised a lack of transparency and poor corporate governance in relation to the company behind the controversial Re-turn scheme, and described the way the firm was set up as “bizarre”.

In a damning broadside, Jennifer Whitmore said she had “serious concerns” regarding the operation of the deposit return scheme, and does not believe it can continue in its current form.

Ms Whitmore, who is a member of the Oireachtas Committee on the Environment and Climate Action, questioned Minister Ossian Smyth about the scheme in the Dáil last week, but was unhappy with the level of information he provided.

The Re-turn scheme is operated by a private company called Deposit Return Scheme Ireland Limited, and most of its directors are representatives of major beverage producers.

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“When you have good governance on a board, it would dictate that the people are independent of the entity as such, that there isn’t any conflict or perceived conflict of interests,” Ms Whitmore told the Irish Mirror.

“Having so many producers on the board would raise concerns for me. [The list] read more like a stakeholders’ group as opposed to a board of directors,” she added.

A spokesman for Re-turn rejected the criticism, insisting that the scheme is operating "to the highest standards of corporate governance", and adheres to a code developed for extended producer responsibility schemes. "Re-turn is operating within the guidelines set for it," he added.

The Wicklow TD also criticised the lack of transparency surrounding the operation of the company, which retains deposits where containers are not returned, and also keeps the money it gets from selling the aluminium and plastic from recycled bottles and cans.

“It’s very difficult to find out any information about it,” she said. “I raised this with the minister and he said they are to operate in a transparent fashion. There is very little transparency at the moment as to how this is operating.”

Ms Whitmore said she had expected “a lot more transparency” given the amount of public money the company will be handling, and the fact that it is responsible for such an important scheme when it comes to the country’s recycling obligations.

A spokesman for Re-turn said the company "does not want unredeemed deposits", and encouraged consumers to return their drinks containers to get their money back. However, he added that "unredeemed deposits will be reinvested into the scheme and used to fund recycling initiatives to help Ireland achieve future recycling targets".

The Social Democrats TD said: “There could be a lot of money going through this organisation and it’s public money, but it’s not set up as a public entity – quite the opposite, it’s been set up as a producers’ entity. I do think we need to have a very close eye on its operation and governance.”

She described the way in which the company had been set up as “bizarre”.

“Essentially, the minister said to the industry: ‘Okay, ye go off and set this thing up and man it and then come back to me with your business proposals.’ I just thought this was a really bizarre way to go about it.”

The company is not intended to be profit-making, as the cost incurred by beverage suppliers when producing specially labelled cans and bottles is expected to be equal to the amount of uncollected deposits, thereby paying for itself.

However, Minister Smyth revealed last week that these financial projections had been calculated by the company itself. It is also based on the assumption that eight per cent of containers will not be returned. Early figures suggest that this may be significantly higher, however, substantially increasing the company’s revenue.

“I have an awful lot more questions that I want answered,” said Ms Whitmore, who said she would be seeking information regarding the salaries of those remunerated by the company.

She believes the deposit return scheme is unlikely to continue in its current form. “I think it will have to change,” the TD said. “My expectation is that… the amount of money they’re taking in through unredeemed [deposits] is going to shock people when it’s finally reported, and I think at that stage there will be a lot of eyes on it.”

The Re-turn spokesman told the Irish Mirror: "DRSI CLG, a new company limited by guarantee, was established by beverage producers and retailers to fulfil their obligations under the Separate Collection (Deposit Return Scheme) Regulations 2021.

"Deposit Return Scheme Ireland (DRSI) CLG is a not-for-profit organisation trading as Re-turn, which Minister Ossian Smyth appointed in July 2022. The Deposit Return Scheme brings together all parties involved in the manufacture, selling and consumption of beverages and has proved successful internationally in increasing collection rates."

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