FOOD AND BEVERAGE INDUSTRY MEDIA RELEASE

Friday 19 December 2014

Industry welcomes COAG decision

AN alliance of Australia’s top business associations has welcomed the findings of a Council of Australian Governments (COAG) report that recommends the introduction of an industry-led national recycling and anti-litter program, while rejecting an alternative and unaffordable, $8 billion container deposit scheme.

The COAG report, released today, examined 10 different options to improve recycling and reduce litter, and found an extension of the successful Australian Packaging Covenant was the most attractive, as it would generate $285 million of recycling and litter reduction benefits.

Importantly it would have no impact on consumers or jobs.

COAG rejected a Greens-backed $8 billion container deposit scheme (CDS) as the least affordable of the 10 options.

Independent analysis1 has shown a CDS would cost households an extra $300 each per year, or double the impact of the Carbon Tax.

It would cut 1,800 jobs nationally, including 400 in NSW, predominately from Western Sydney.

The vulnerable jobs are concentrated in Sydney’s manufacturing and distribution heartlands of Auburn, Campbelltown, Penrith, Parramatta and Smithfield.

In addition, almost 450 Victorian jobs would be threatened in drink manufacturing, distribution and packaging hubs particularly around Shepparton, Niddrie, Altona, Broadmeadows and Carrum.

The industry alliance’s spokesperson, Geoff Parker of the Australian Beverages Council, called on all governments to accept the findings of the COAG report and to work with industry to implement the recommended solution.

He said the alternative CDS plan would increase the retail price of every bottle, can, carton of milk, soft drink, beer, wine and juice container by up to 20 cents.

“To participate in a CDS people need to store cans, bottles and cartons at home and then drive to a handful of depots in Sydney, scan them into a container one by one to receive a portion of their own money back,” he said.

“The operating costs of the scheme are so high that it would cost NSW families an extra $300 a year at the checkout and threaten hundreds of jobs across the state.

“Lower income NSW families would be hit the hardest by this new tax while time-poor families would have to drive across town for a refund, when they currently recycle perfectly well out the front of their houses using yellow-topped bins.

“The CDS is an out-dated and discredited scheme and has already been rejected by Queensland and Victoria and has now been dismissed by COAG analysis.”

The findings of the COAG report revealed the container deposit scheme demonstrated a net economic cost with negative net present values. Under the COAG guidelines for best practice regulation it could not be recommended for implementation.

COAG found the industry’s Extended Australian Packaging Covenant provided a number of key benefits over other options including:

  • The design optimises outcomes because it targets all packaging and covers all participants along the supply chain, from design and manufacture to end of life disposal
  • It is non-prescriptive in how outcomes can be achieved, with a flexible and adaptable approach that is better able to respond to changes in the market and operating environment
  • No new regulations are required
  • It has demonstrated that it can operate alongside a range of existing regulatory arrangements
  • It has more moderate impacts for consumers, and business, when compared with some of the higher-cost options.

Among a string of new initiatives, the Extended Australian Packaging Covenant would:

  • Provide funding and support to local councils to target local litter hot spots and further improve already successful kerbside recycling by reducing contamination
  • Partner local community groups, including Keep Australia Beautiful, on targeted litter reduction projects, tailored to local needs – including marine and roadside strategies
  • Fund a long-term behavioural change program, to embed an anti-litter culture
  • Invest in new recycling infrastructure, to increase the amount of packaging that can be recycled;
  • Extend away-from-home venue and business recycling.

Since 2003 the national packaging recycling rate has increased from 39% to 64.2%, exceeding the EU packaging recycling rate.

According to Keep Australia Beautiful’s 2013/14 National Litter Index, litter rates also continue to reduce nationally – with the overall average number of items per 1,000m2 at 51, down from 56 in 2012/13, and the overall average estimated volume per 1,000m2 at 5.97 litres, down from 6.13 litres in 2012/13.

Extending the Australian Packaging Covenant will significantly accelerate this long-term trend.

The COAG report is titled the Packaging Impacts Decision Regulation Impact Statement.

The following alliance members call on all governments to accept the findings of the COAG report and work with industry to implement its recommended solution:

  • Australian Beverages Council
  • Australian Food and Grocery Council
  • Brewers Association of Australia & New Zealand
  • Australian Dairy Products Federation
  • Australasian Association of Convenience Stores.

-ENDS-

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1 ACIL Tasman, September 2011, “National Container Deposit Scheme Impacts”

MEDIA RELEASE_Industry welcomes COAG decision FINAL (3)

More information:  The Connolly Partnership – Adam Connolly 0417 170 084

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