SINGAPORE: Any costs passed on to consumers due to the beverage container return scheme are likely to be limited by price competition among industry players, Senior Minister of State for Sustainability and the Environment Janil Puthucheary said in parliament on Tuesday (Feb 3).
"This has been the experience in some jurisdictions that have implemented this, where studies found that the introduction of deposit return schemes did not have a significant direct impact on beverage prices or beverage sales," he said.
Dr Puthucheary noted that the pricing of beverages is a complex decision, which is affected by consumer demand patterns and marketing strategies.
“We have designed the scheme to be run as efficiently as possible, with a low cost to producers,” he said.
"Any cost pass-through to consumers will likely be further moderated by price competition among industry players, as consumers have a wide variety of choices."
Under the scheme, which begins on Apr 1, consumers will pay a S$0.10 (US$0.07) deposit for most bottled and canned beverages. The deposit can be refunded when the empty container is returned at designated reverse vending machines.
Responding to a supplementary question about how consumers will be protected if increased costs lead to much more expensive drinks, Dr Puthucheary said on Tuesday that consumers are "quite discriminatory".
"They will adjust their purchasing if there is indeed some attempt to extract excessive profits through this process," he said, adding that the National Environment Agency (NEA) will monitor beverage prices after the scheme is rolled out.
Dr Puthucheary explained that all producers will have to pay a producer fee of S$0.03 to S$0.04 to scheme operator BCRS, to cover the collection and recycling of the beverage containers.
Producers of about 80 per cent of beverage containers can incorporate the deposit mark and barcode requirements directly on their containers, he added.
“Beyond the once-off implementation cost, these producers should see costs per container close to the producer fee of S$0.03 to S$0.04, which should keep compliance costs low for most drinks sold,” he said.
To comply with the scheme, some producers may need to, or choose to, place a sticker on their containers instead of changing the container's design. The cost of these stickers will vary, Dr Puthucheary said.
In response to a supplementary question about considering longer-term support for smaller producers, Dr Puthucheary said a grant of S$2,500 provided to all registered producers is sized to address the needs of smaller producers who put fewer than 50,000 containers to market each year.
"The S$2,500 is, we think, more than sufficient to cover both the product registration cost as well as the producer fees for the first year, which total about S$2,000," he added.
"But we also have to recognise that the purpose of this scheme is to shift some of the responsibility to the producer."
The beverage container return scheme was originally meant to start in April 2025, but authorities pushed it back by a year as major beverage producers had requested more time to operationalise the scheme.
These containers are expected to gradually enter the market during the transition period from Apr 1 to Sep 30, with widespread availability expected by August and September.
Nine in 10 Housing and Development Board (HDB) residents will be within a five-minute walk of a beverage container return point when the scheme launches in April, Dr Puthucheary said in January.
About 1,000 return points will be deployed across major supermarkets and high-footfall areas, and the aim is to double that number within the first year of operations, he added.
“We want to create a scheme that works for all of us,” Dr Puthucheary said in parliament on Tuesday.
Ambassadors will be deployed on the ground to guide the public on how to use the machines at launch, he added.
“We recognise that some seniors and vulnerable members of the community may require additional assistance to adapt to the scheme,” he said, noting that the NEA and scheme operator BCRS are committed to providing additional support to better address their needs.
A key focus in the coming weeks is working closely with all stakeholders to build understanding and support for the scheme, said Dr Puthucheary.
The government is also in discussion with other key stakeholders, including coffee shops and smaller retailers, to help them understand the scheme so they can explain it to consumers, he added.
When asked about whether the government anticipates queues and other operational challenges with the reverse vending machines, Dr Puthucheary noted that Singapore has piloted about 50 of these machines in the past four years.
The operators of the pilot are involved in the new scheme and have assessed that there is a "minimum volume collection" per day that makes the logistical arrangements cost-effective, he added.
There is also a contractual requirement for these operators to maintain a 90 per cent uptime for their machines, he said.
Describing the scheme as a significant step forward in Singapore’s recycling journey, Dr Puthucheary stressed that it will take time for people to adjust.
“We will not get everything right from the start, and we ask for feedback, suggestions and understanding as we transit to this new way of recycling. As we gather more data, we will refine and improve the scheme," he added.
“We need everyone’s support to make this scheme a success.”
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"This has been the experience in some jurisdictions that have implemented this, where studies found that the introduction of deposit return schemes did not have a significant direct impact on beverage prices or beverage sales," he said.
Dr Puthucheary noted that the pricing of beverages is a complex decision, which is affected by consumer demand patterns and marketing strategies.
“We have designed the scheme to be run as efficiently as possible, with a low cost to producers,” he said.
"Any cost pass-through to consumers will likely be further moderated by price competition among industry players, as consumers have a wide variety of choices."
Under the scheme, which begins on Apr 1, consumers will pay a S$0.10 (US$0.07) deposit for most bottled and canned beverages. The deposit can be refunded when the empty container is returned at designated reverse vending machines.
Responding to a supplementary question about how consumers will be protected if increased costs lead to much more expensive drinks, Dr Puthucheary said on Tuesday that consumers are "quite discriminatory".
"They will adjust their purchasing if there is indeed some attempt to extract excessive profits through this process," he said, adding that the National Environment Agency (NEA) will monitor beverage prices after the scheme is rolled out.
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Dr Puthucheary explained that all producers will have to pay a producer fee of S$0.03 to S$0.04 to scheme operator BCRS, to cover the collection and recycling of the beverage containers.
Producers of about 80 per cent of beverage containers can incorporate the deposit mark and barcode requirements directly on their containers, he added.
“Beyond the once-off implementation cost, these producers should see costs per container close to the producer fee of S$0.03 to S$0.04, which should keep compliance costs low for most drinks sold,” he said.
To comply with the scheme, some producers may need to, or choose to, place a sticker on their containers instead of changing the container's design. The cost of these stickers will vary, Dr Puthucheary said.
In response to a supplementary question about considering longer-term support for smaller producers, Dr Puthucheary said a grant of S$2,500 provided to all registered producers is sized to address the needs of smaller producers who put fewer than 50,000 containers to market each year.
"The S$2,500 is, we think, more than sufficient to cover both the product registration cost as well as the producer fees for the first year, which total about S$2,000," he added.
"But we also have to recognise that the purpose of this scheme is to shift some of the responsibility to the producer."
The beverage container return scheme was originally meant to start in April 2025, but authorities pushed it back by a year as major beverage producers had requested more time to operationalise the scheme.
These containers are expected to gradually enter the market during the transition period from Apr 1 to Sep 30, with widespread availability expected by August and September.
Nine in 10 Housing and Development Board (HDB) residents will be within a five-minute walk of a beverage container return point when the scheme launches in April, Dr Puthucheary said in January.
About 1,000 return points will be deployed across major supermarkets and high-footfall areas, and the aim is to double that number within the first year of operations, he added.
“We want to create a scheme that works for all of us,” Dr Puthucheary said in parliament on Tuesday.
Ambassadors will be deployed on the ground to guide the public on how to use the machines at launch, he added.
“We recognise that some seniors and vulnerable members of the community may require additional assistance to adapt to the scheme,” he said, noting that the NEA and scheme operator BCRS are committed to providing additional support to better address their needs.
A key focus in the coming weeks is working closely with all stakeholders to build understanding and support for the scheme, said Dr Puthucheary.
The government is also in discussion with other key stakeholders, including coffee shops and smaller retailers, to help them understand the scheme so they can explain it to consumers, he added.
When asked about whether the government anticipates queues and other operational challenges with the reverse vending machines, Dr Puthucheary noted that Singapore has piloted about 50 of these machines in the past four years.
The operators of the pilot are involved in the new scheme and have assessed that there is a "minimum volume collection" per day that makes the logistical arrangements cost-effective, he added.
There is also a contractual requirement for these operators to maintain a 90 per cent uptime for their machines, he said.
Describing the scheme as a significant step forward in Singapore’s recycling journey, Dr Puthucheary stressed that it will take time for people to adjust.
“We will not get everything right from the start, and we ask for feedback, suggestions and understanding as we transit to this new way of recycling. As we gather more data, we will refine and improve the scheme," he added.
“We need everyone’s support to make this scheme a success.”
Continue reading...