NSW Premier Mike Baird has always made his intentions clear about a container deposit scheme in NSW.
On 22 February, he announced formally that a re-elected Baird Government will introduce reverse vending machines across the state. This, he stated, will be ”part of a cost-effective container deposit scheme for the recycling of drink containers”.
The government will engage in comprehensive community consultation on the design of the scheme and the incentive structure for communities to participate.
By 1 July 2017, communities will be rewarded for their recycling efforts through the use of reverse vending machines at popular beaches, parks, and public spaces across NSW.
In the Baird Government’s preferred model consumers, or a charity of their choice, will receive a small financial reward for depositing a drink container in a reverse vending machine. Submissions for alternative models have been invited.
“We want to help communities look after their local environment by being better equipped to tackle litter and increase recycling,” Baird stated.
“We estimate that at least 800 reverse vending machines will be installed across NSW – offering communities the opportunity to be rewarded for contributing to positive environmental outcomes in the places where they are most needed.”
“Our container deposit scheme will complement, rather than compete with, our existing kerbside recycling system and help the government achievement our ambitious litter reduction and recycling targets,” environment minister, Rob Stokes, added.
“Over the next 12 months we will consult with the community and industry on how we will implement a scheme, which will be underpinned by a comprehensive cost benefit analysis.
“The final design of the container deposit scheme will be announced in 2016, and will include the use of reverse vending machines and an incentive for the community to participate.”
- The consultation with the community and industry will focus on:
- The location of reverse vending machines
- The incentive for community participation
- The scope of containers to be redeemable under the scheme
- The involvement of local government and the recycling industry in the scheme
PCA chief executive officer, Gavin Williams, has offered his insights in a report, NSW and Container Deposits – A Packaging Policy Game Changer?
Below is his analysis in full:
The NSW Premier’s announcement leaves his Government with lots of “wriggle room” on this matter should they be re-elected.
The Policy. There is a “lot of water to go under the bridge” before the final policy outcome is settled. The NSW announcement does not preclude a wider, legislated, container deposit scheme. Such a scheme, going beyond reverse vending machines (RVM’s), remains on the cards. Certainly, that’s what environmental groups such as the Boomerang Alliance and the Total Environment Centre (TEC) will be pushing for. They believe that the debate and the tide of public opinion on this issue are running in favour of a legislated scheme. NSW local government is also likely to be active as they get very little benefit from a scheme relying solely on RVM’s.
The Scope. The beverages, and beverages containers, to be included under the RVM proposal are still to be finalised. Interestingly, the design principles attached to the Premier's letter mentioned only “glass, aluminium and plastic beverage containers”. On this question a unified industry position is unlikely.
The Other States. Other Governments, particularly Queensland and Victoria, will need to consider their policy response. The current Queensland Government in principle supports introducing container deposits as does the ACT. At the very least they will want to ensure that they receive the same financial benefits from the beverage companies as those that may flow to NSW.
The Covenant: The potential impact on the Covenant could be significant. It still has some value for governments, particularly its NEPM provisions on free riders. But governments want a greater say as to where Covenant funds are spent. Will the beverage companies remain signatories? Overall, the Covenant is most unlikely to continue in its present form. The Covenant agreement with the States will need to be extended as finalisation of this matter is unlikely before it expires in mid-2015. A short term extension of 12 months is being contemplated and will provide some breathing space. It may not, however, promote confidence amongst industry signatories about the long term future of such regulatory agreements.
The Industry Response: For all company signatories, the standing, authority and perceived value of the Covenant has been harmed by the NSW decision. The real danger for industry is that the NSW approach will encourage policy fragmentation from the other States and thereby jeopardise a consistent, coherent national approach. In addition, there is already disquiet about the Covenant’s worth and the level of financial contributions companies are required to pay. Under any new arrangements, companies will be asked to contribute significantly more. There is likely to be a number of companies who will consider ceasing their Covenant membership, believing that (1) the Covenant hasn’t provided regulatory certainty and (2) the likelihood of governments taking compliance action is remote.
In short, there is a long way to go before this matter is settled and finalised.
