Cash for drink containers scheme would cost taxpayers $9 million

Benjamin Preiss and Clay Lucas

August 7, 2019

The Age

A cash-for-cans and bottles scheme to combat Victoria’s recycling crisis would cost the state government $9 million over four years, according to the state’s own Parliamentary Budget Office.

If the state charged beverage manufacturers a small fee for each can or bottle sold, the price of each drink would cover the cost of the refund program, the office’s independent analysis suggests.

While the cost would most likely be passed on at the till, consumers could recoup 10¢ per drink by returning cans and bottles to a drop-off point.

The analysis was commissioned by the Victorian Greens who pledged to introduce legislation to establish a container deposit scheme when State Parliament resumes this month.

Revenue from unclaimed deposits could go into a fund managed by the Environment Protection Authority, estimated to cost $9 million a year.

The proposed scheme could generate an estimated $253.5 million over four years, which would pay for the cost of expanding and improving Victoria’s aluminium and glass recycling.

It estimated the revenue would come from unclaimed deposits.

In NSW, where a cash-for-cans scheme was reintroduced in December 2017, the revenue from unclaimed refunds goes back to manufacturers, with some using that money to offer product discounts.

Victorian Greens leader Samantha Ratnam said it was time for Victoria to join the other states and territories by committing to a refund scheme to boost recycling levels and reduce pollution.

“The Victorian government is now blocking the creation of a national container refund scheme,” she said. “There is no excuse to delay the introduction of this important piece of the puzzle to fix our recycling crisis.”

In NSW, drink containers can be returned to reverse vending machines or “over-the-counter sites” to retrieve the refunds.

The cans and bottles collected through container deposit schemes are generally sorted and sold overseas or recycled locally into new products.

A spokeswoman for the Victorian government said its focus was developing markets and products that used recycled material.

“The management of waste and recycling is a complex problem, not just here in Victoria but across the globe – there’s no silver bullet that will fix it,” she said.

Victoria’s kerbside recycling system has been thrown into crisis after one of the biggest processing companies, SKM, became insolvent and abruptly stopped accepting recyclable material last month.

A Supreme Court ruling released on Wednesday found that 16 creditors were now chasing SKM for millions of dollars owed to them for helping the company transport, store or move materials.

This week at least 15 councils – who had paid SKM millions of dollars to take their recyclable materials – confirmed they were now sending thousands of tonnes of recycling material to landfill.

Councils have urged the state government to introduce a cash-for-cans scheme to help cure Victoria’s recycling woes.

Boomerang Alliance director Jeff Angel said the recycling programs were operating well interstate with unclaimed deposits funnelled back into operating the scheme.

He cited figures that showed average non-alcoholic beverage prices increased by about 10¢ after the container deposit scheme was introduced in NSW while alcohol beverage prices rose by about 5¢.

“It’s working just as predicted and recycling of the resulting high quality material is supporting new jobs and economic activity,” he said. “Victoria needs to get on board – its continued inaction is untenable.”

In South Australia, which has had a container deposit scheme since 1975, 80 per cent of cans and bottles were returned in 2016/17.

A spokesman for Coca-Cola Amatil said the company was “proud to support cost-effective, well-run container deposit schemes in other states and territories around Australia and are a scheme co-ordinator for all the ones in operation”.

Residents in NSW returned more than 900 million bottles and cans by November last year, the ABC reported, although the scheme there was hampered by a slow rollout of reverse vending machines.