Businesses claim plastic bag ban is dragging the economy down

Shoppers are only buying what they can carry since a ban on single-use plastic bags was introduced, businesses now claim. DO YOU AGREE? VOTE IN OUR READER POLLS

Australia’s economy is taking a hit because of the ban on plastic bags.

Big business has made the new claim in a ministerial submission created by the Department of Treasury, which reports on the findings of its business liaison program held between February and March, The Australian reports.

The report notes: “Several firms suggested that the introduction of a ban on plastic bags meant customers reduced their consumption to an amount that they could instead carry, and delayed purchases of heavier groceries.”

Shoppers only buy what they can carry to their car or home, according to businesses. Picture: AAP

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Treasury was also warned that the poor showing in the retail sector would likely see “continued subdued inflation, with grocery deflation only partly offset by higher power prices”.

Major supermarkets have been phasing out single-use plastic bags for over a year now.

Woolworths says it has handed out about three billion fewer plastic bags across the country over the past year.

Coles says it has diverted 1.7 billion single-use bags from landfill, with data claiming seven in 10 of its consumers now remember to bring a reusable bag when they shop and a further two in 10 bringing them on more occasions than not.

Single-use plastic bags have been banned in South Australia, Queensland, the ACT and Western Australia, while Victoria is expected to follow in November.

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There is no doubt the ban on single-use plastic bags is reducing plastic on earth.

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UNSW Business School professor of economics Richard Holden told The Australian if people were buying fewer groceries it was likely they were forgoing unnecessary items.

“It’s hard to believe there will be a macroeconomic effect from plastic bag bans,” Professor Holden said.

“What are heavy groceries? It’s things like bottles of soda and soft drink. A plastic bag ban isn’t going to mean that people aren’t feeding their children or buying the things they really need. It’s almost surely that people are not throwing in the optional extras. It doesn’t sound like the end of the universe,” he said.

But Australian Prudential Regulation Authority member Geoff Summerhayes said there was an unavoidable short-term economic cost involved in going green.

“Regardless of their choice, some pain will be felt — the only questions being how much and when,” he told The Australian.