Cash-a-can: Container deposit scheme branded a ‘debacle’
IT WAS heralded as the one of the biggest litter reduction schemes in NSW, but the revamped “cash-a-can” scheme has turned into a farce with Government’s own MPs labelling it a debacle and warning of job losses.
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IT was heralded as the biggest litter reduction scheme in NSW, but the revamped “cash-a-can” scheme has turned into a farce with Government’s own MPs labelling it a “debacle” and warning of job losses.
So botched is the rollout of the “return and earn” container deposit scheme, that the Government has been forced to offer businesses $200,000 interest-free loans to stop staff from being sacked as owners struggle to cover exorbitant fees and upfront costs.
Despite the recycling program set to begin on Friday, the Environment Minister Gabrielle Upton is yet to unveil the location of the 500 promised collection points where consumers will be able to redeem their bottles for 10c.
And in a move the State opposition claims is evidence the government struggled to get retailers on board, shopkeepers have been allowed to offer in-store vouchers instead of cash, significantly changing the nature of the scheme.
The government is also under fire from retailers and brewers failing to educate the public about the reason why drink prices will be going up next month, with some beer distributers saying some brands will rise up to $15 per case to cover costs.
At the same time, questions are being asked as to the environmental benefit of the scheme given they have to be “empty, uncrushed, unbroken, and have the original label intact”, ruling out those that have been dumped as litter.
Opposition environment spokeswoman Penny Sharpe said the rollout of the emergency loans was evidence of how badly the government had mismanaged the implementation of the scheme.
“It takes special skill to botch the roll out of a program so badly that the government is forced to give emergency loans to businesses to stop them going broke,” she said.
Announced in 2015 amid strong opposition from major drink companies, former premier Mike Baird said the scheme was being introduced to reduce the volume of litter in NSW by 40 per cent by 2020.
The government won over its biggest rivals after appointing Exchange for Change, an industry joint venture involving major players Coca-cola, Sahi, Carlton & United Breweries and Coopers and Lion, as the scheme’s co-ordinator.
Among the biggest issue has been the upfront payment of thousands of dollars businesses were last month ordered to pay up to cover the $52 million cost of the first-round of refunds and administration costs.
In the case of family-run juice business Bevco Pty Ltd in Mudgee, which manufactures Orchy and Macquarie Valley juices, the first monthly invoice amounted to $35,000.
The company, which employs 50 staff, was also forced to pay an $8,000 fee to the NSW Environment Protection Authority (EPA) to cover an $80 fee for each different class of drink it sold.
Bevco financial controller Corinne Hoffman said the business had tried to pass on the costs to distributers and supermarkets, but some had refused to pay, forcing the company to absorb the difference.
She said the company was unsure if it would be able to cover the cost of the next bill — due December 7 — while staff had been given no guarantees as to the future.
“We are concerned at what the future holds — we employ 50 people and we don’t have big margins,” Ms Hoffman said.
“Our biggest concern is if our loyal customers will continue to support us.
“What has made it worse is that we didn’t get the costings until late August, and then all of sudden we had to urgently pass on the increases.”
The Australian Liquor Stores Association (ALSA) said its members had been faced with the tough decision as to whether to absorb the costs of the refund and administration fees or pass on to consumers.
Manly craft beer distributer Johnny Latta said he was considering legal action to recover some of the costs, claiming it had potential to put small brewers out of business.
“At no point has the NSW government and the EPA property consulted with industries like craft beer to work through the challenges of this type of program, or the massive impact,” he said.
“Consumers are expecting $3-$5 increases, but with small batch lines and the administration fee, the cost increases will need to be around $15 per case.”
The $80 fee to the Government has cost his business $24,000, he said.
Last month, small beverage manufacturer Saxbys in electorate of Myall Lakes MP Stephen Bromhead was sent an invoice for $300,000 payable by 8 November to enter into a supply agreement.
It triggered a call by Mr Bromhead for financial assistance packages, warning local manufacturing and jobs were being placed on the line.
In a scathing letter to Ms Upton sent October 6, Liberal MP Greg Aplin called for scheme to be delayed, stating that owners and managers of independent supermarkets in the Albury electorate were fearful of “substantial financial losses” when consumers head across the border to Victoria to stock up on cheaper booze.
“What I cannot get over, however, is the poor level of communication and support for this project,” he wrote.
“The NSW government, by proceeding on its own, is implementing a policy that, while well supported in principle, is a debacle for smaller retailers here and along the Murray.”
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Ms Upton said the government had offered assistance to businesses, but not all had taken it up.
She said the scheme was being introduced because people had been asking for it “for decades”.
“The rollout is a massive logistical exercise,” Ms Upton said.
“There will be more than 200 collection points on 1 December with many more to come as the rollout continues.”
As for concerns shoppers would head across to Victoria for cheaper drinks, Ms Upton said Victoria needed to follow suit with a similar scheme.