BIFFA has started legal action to recover £55 million from the Scottish Government after plans for the Deposit Return Scheme (DRS) fell through after Westminster interference.
Lawyers for the waste firm addressed judge Lord Clark at the Court of Session on Tuesday, arguing that Scottish ministers are responsible for the firm incurring a £150m loss.
Biffa is looking for compensation for the money it initially invested as well as subsequent loss of profit.
The Scottish Government initially designed its own DRS, but its launch was ultimately delayed to 2025 last year in order to bring it in line with a planned UK-wide scheme.
The Scottish Government blamed Westminster’s refusal to allow glass in the scheme for the delay announced last year, accusing the Conservatives of sinking Scotland’s DRS and undermining devolution.
However, the UK Government said the delay was entirely the decision of ministers in Edinburgh, who failed to design the scheme properly.
Biffa had already bought around 200 new trucks and recruited staff when the delay was announced, with the firm arguing that it relied on personal assurances from then circular economy minister Lorna Slater to inform the decision to invest.
The firm was initially given a 10-year deal to collect all the recycled containers across Scotland, and expected to make more than £100m in profit.
The UK Government has since pushed back plans for a UK-wide scheme to 2027.
The scheme was first announced by then environment secretary Michael Gove in 2018.
However, in a ministerial statement in April current Environment Minister Robbie Gibb said the scheme had once again been delayed.
“Following extensive engagement with industry, who will be responsible for delivering the DRS, and a review of international approaches to DRS implementation, additional time will be needed to efficiently and effectively roll out the schemes across the UK,” he said.
“With the agreement of ministerial colleagues across the devolved administrations, the DRS will go live in October 2027.”
A spokesperson for Biffa said: "Biffa was selected by Circularity Scotland Limited (“CSL") as the logistics partner for the delivery of the Scottish Deposit Return Scheme and invested significant sums to support its timely and successful implementation.
"This was done in good faith and on the expectation and understanding that the delivery of the scheme had been mandated by the Scottish Government.
"Having carefully reviewed our position with our advisors, we can confirm that we are taking legal action to seek appropriate compensation for the losses Biffa has incurred.
"Given the legal action, we are unable to comment any further at this time."
The Scottish Government have been approached for comment.
