Is the container recycling scheme a costly feel good exercise?

Is the container recycling scheme a costly feel good exercise?

At first glance drink container recycling schemes such as NSW's "Return and Earn Program" and the ACT's Container Deposit Scheme, which takes effect on June 30, make a lot of sense.

In addition to encouraging recycling they also provide a positive reason not to litter. And, best of all, time-rich, cash-poor members of the community can make a few extra dollars by collecting bottles and cartons from the roadside.


Unfortunately there can be a gulf between the modelling and the reality.

That has proved to be so in NSW where some communities no longer have the reverse vending machines needed to collect the refunds.


The businesses that hosted them quickly grew tired of the associated noise, public safety and littering issues. Thankfully, the ACT is opting for a face-to-face return model, rather than the reverse vending machines that have proved problematic over the border.

But there is the fact that both NSW and ACT bureaucrats appear to be overestimating the likely percentage of returns.

Larry Everington, the owner of Mudgee-based beverage supplier Bevco, said while 389 million bottles were sold in NSW last December only 20 million, or about five per cent, had been returned through reverse vending machines. Almost $36.9 million in potential refunds would have gone uncollected.

The overall cost to consumers was even greater with the average price per bottle or container going up by 15 cents, or $58.3 million for the month, when the scheme was introduced.

Fairfax reported in February that NSW returns were running at about one fifth of what had been predicted. The state's Shadow Environment Minister, Penny Sharpe, said only 83 million vessels had been taken to centres in the first 10 weeks.

While the ACT Government claims it has learnt from the NSW experience, it is at risk of repeating some of the same mistakes.

It predicts overall recovery rates in excess of 70 per cent over the first three months.

While this includes the almost 40 per cent of containers already being recycled under the kerbside recovery scheme, it is still well in excess of anything achieved across the border to date.

Then there is the issue of whether the materials will actually be recycled or just dumped into land fill with recent changes in China's policies on accepting waste from Australia sending shock waves through the sector.

The real question is whether or not this is cost effective. That is of vital importance to Canberrans who will soon be paying significantly more for some drinks.

When the NSW scheme was introduced Woolworths responded by increasing the price of its home brand drinks from 75 cents to 90 cents.

While the ACT Government has pledged to consider price monitoring measures as part of its scheme there is no reason to think exactly the same thing won't happen here.

The risk is this could rapidly devolve into a costly, feel good measure that adds little to the benefits of the kerbside recycling scheme already in place.

Because the fixed costs hit the cheapest beverages the hardest it will almost certainly be felt most by those on low incomes.

The last thing anybody should want to see is a socially regressive indirect tax on consumer beverages imposed in the name of alleged environmental benefits of dubious legitimacy.

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