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Legislative Council - Fifty-First Parliament, Second Session (51-2)
2008-06-17 Daily Xml
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ENVIRONMENT PROTECTION (MISCELLANEOUS) AMENDMENT BILL

Second Reading

Adjourned debate on second reading (resumed on motion).

(Resumed this page.)

The Hon. SANDRA KANCK (19:49): The Democrats support this bill, which will improve South Australia's much vaunted and admired container deposit system. I am sure that most MPs have found over the years that when they meet MPs from other states and go to conferences there is always discussion about our container deposit legislation. There is envy (I suppose that is probably the best way to describe it) when politicians in other states talk about our system and say how they wish—

The Hon. C.V. Schaefer: Why don't they bring it in then?

The Hon. SANDRA KANCK: I will get to that. They do not bring it in because of the power of the packaging lobby. They fall at the hurdle every time there is an attempt.

There is no doubt that container deposits are very effective. The tonnage rates for collection of bottles of assorted types are far in excess of what other states manage to get. South Australia recovers 85 per cent of non-refillable glass soft drink bottles compared with 36 per cent nationally. The return rate for plastic soft drink containers (PET) is 74 per cent while the national return rate is 36 per cent. Ian Kiernan, founder of Clean Up Australia and a past Australian of the Year, said:

Beverage container recycling rates are appalling low in most states. 40 per cent of the rubbish we collect on Clean Up Australia day is bottles and cans, but in South Australia, where they have container deposits, they are just 8.4 per cent of the rubbish we collect.

Ian Kiernan has been a strong defender of the South Australian system and has argued that similar systems should be introduced in other states. I take members back to 2004 when our esteemed environment minister, the Hon. Gail Gago, was a backbencher. The minister was a member of the Environment, Resources and Development Committee (as was I) at the time the committee conducted an inquiry into waste management. That committee made seven recommendations about container deposit legislation, and they were numbered 20 to 26 in the list of recommendations. I will read them all because, ultimately, when she is summing up, I would like the minister to give some feedback to us all about how each of these recommendations have been addressed. Recommendation 20 states:

The committee recommends the Prime Minister through COAG encourage all states and territories to adopt uniform container deposit legislation.

I do not know that we had much power over the Prime Minister. The recommendations continue:

Recommendation 21: the committee recommends that all CDL containers be a uniform capacity of up to and including three litres.

Recommendation 22: the committee recommends the 5¢ deposit value be reviewed and that an analysis of the benefits of an increase be determined considering both economic and environmental factors.

Recommendation 23: the committee recommends that the government introduce legislation to minimise the potential abuse of CDL [and I note that this legislation does deal with that].

Recommendation 24: the committee recommends the development of industry standards for super collectors.

Recommendation 25: the committee recommends the EPA collect data to make the container deposit scheme more transparent and determine the amount of unredeemed deposits.

Recommendation 26: the committee recommends that government investigate the value of unredeemed deposits so that unredeemed deposits can be returned to the system for litter education initiatives.

One has to observe that progress is slow. It is five years since the House of Assembly referred that particular waste management issue to the Environment, Resources and Development Committee, and it is four years since the committee conducted the inquiry. I note that the minister has announced that deposits will increase from 5¢ to 10¢, but it is also interesting to observe that the Environment, Resources and Development Committee baulked at making a clear recommendation on increasing the deposit. A couple of sentences from the committee's report in that regard state:

There are convincing arguments to increase the amount of the deposit and for it to remain the same. However, there has been little research to substantiate either side of the argument. The committee believes further investigation into the value of the deposit is required.

The fact is that we did not receive convincing evidence in support of retaining it at 5¢. What happened was good old-fashioned buck-passing, because the unstated fears of the committee were about impacts of competition policy in relation to other states if we went down that path. Again, when she sums up, and although competition policy does not have the power that it had at that time, I would be interested to know what advice the minister did receive in relation to how this fits with other states.

In some of the evidence the committee was given there were some very good arguments for increasing the deposit, and the Ceduna council's submission argued for an increase to 20¢ because it believed that if the glass bottles in particular had a high enough value it would stop them being smashed on the foreshore, as has happened in that area, and they thought that a decent rebate of that amount would encourage more of the bottles to be returned and fewer to be broken.

Having acknowledged that the minister has announced that deposit increase from 5¢ to 10¢, I would like to know whether in fact she considered 20¢ as an option. I reflect that, when I was a child, soft drink manufacturers all had deposits on bottles because it was in their interest to do so. The glass bottles cost so much that it was in their interest to collect them, wash and reuse them and at that stage we had small and large soft drink bottles. The small ones had a deposit of threepence and the large ones had a deposit of sixpence. In 1966, with decimal currency, the sixpence become 5¢. I tried to work out what 5¢ might be worth now, without going to an economist and finding out what inflation rates had been, and I reflected on the fact that 5¢ could buy a single icecream cone at that stage and the same item today would be about $2.50. If we were keeping pace with the real value of money, it seems that we should expect a deposit of at least 20¢. I wonder why the government has been so timid in setting it at 10¢.

Other evidence the Environment, Resources and Development Committee heard included the discrepancy between deposits on different sorts of containers. The minister might remember that representatives from Recyclers of South Australia brought different containers with them and put them up in front of us and said that this one has a deposit on it and this one has not. We saw puzzling differences. They showed us exemptions to the deposit being made on the basis of size. A one litre container of fruit juice did not have a deposit, while a 250ml container of fruit juice did have a deposit. Containers with the same capacity but made of different materials were treated differently, and there was a 5¢ deposit on a one litre PET bottle but not on a one litre cardboard carton.

For some it was the same material but the contents of the packaging made the difference. Fruit juice was exempt from a deposit while basically the same shape container with fruit juice drink—fruit juice watered down with water and sugar—had a deposit. We were told how difficult it was for the recyclers. Your basic 16-year old school leaver working as a labourer in one of these yards had to be aware of something like 3,500 different containers and be able to make an instant assessment as to which pile to throw it in. The point was made that this was also confusing for consumers who had to look at containers and work out whether or not they had a deposit, and for 5¢ it would not be worth it for many consumers.

The Hon. Caroline Schaefer interjected earlier and asked why the other states were not introducing container deposit legislation. It is an interesting question and it is answered by the power of the packaging industry. They are extremely powerful and, in other states, whenever there has been an attempt to introduce container deposit legislation, they have fought very strongly against the introduction, and usually have done so by distorting the arguments and lying by omission—and, sometimes, overtly lying. When the Northern Territory tried to introduce container deposit legislation, I think about 10 years ago, the packaging industry offered half a million dollars to the Northern Territory government to use alternative programs and also falsely told the people of the Northern Territory that if it was introduced the price of a carton of beer would go up by $7 per carton just to cover the deposit and, of course, it scared people.

In 2001 the New South Wales government carried out a review to look at the possibility of introducing container deposit legislation, and it asked the Institute of Sustainable Futures at the University of Technology, Sydney to prepare a report about it. That report found that there was substantial economic benefit to introducing such laws. However, a group representing the packaging industry called C4ES Pty Ltd responded to that report and gave a list of the things it said were wrong in the Sustainable Futures report, and I will pick on one of them only. It said:

The ISF report highlights that CDL systems produce high quality recovered containers...but fails to identify that higher quality recovered materials would not result in increased revenue for recycling systems under current circumstances and is therefore of little importance.

It is interesting to look at Sustainable Futures' response to that, because it highlights the dishonesty of the packaging industry. Sustainable Futures' response was:

The independent review report did not claim that the higher quality of used container material collected through the South Australian CDL system would result in increased revenue for the recyclate.

Then it goes on (and this is something very interesting for us all to look at):

However, the existence of a 30,000 tonne stockpile of contaminated glass fines at Chullora MRF [materials recycling facility] is proof enough of the additional costs imposed on used container material recycling by contamination arising from our current collection methods.

We also saw that when the Productivity Commission was looking at CDL the packaging industry and its spin doctors argued that the benefits of CDL might not outweigh the costs. It is very obvious that the packaging industry is a very effective lobby group, but it ignores some of the costs to reach that conclusion.

On 10 February this year there was an article in The Age entitled 'Revealed: our growing glass mountain'. A short time ago I referred to the Chullora recycling facility in New South Wales, but this is in Victoria. It stated:

Victoria is one of the highest per capita waste generators in the world and efforts to recycle outside the home need to be accelerated. This is the view of Sustainability Victoria as it ramps up efforts to curb Victoria's waste addiction.

The latest available figures show that on average every Victorian creates two tonnes of waste a year, up from 1,200 kilograms in 1993-94.

Victoria produces more than 10 million tonnes of waste annually. This is predicted to increase to 13 million tonnes by 2012-13 if reduction targets are not met, 11 million tonnes if they are.

This article has a photo of what can only be described as mountains of glass fabrics at Visy in Melbourne. It shows one person on top of one of those mounds. It is a little difficult to describe the picture, but the person is barely visible in a photograph that is about seven by four centimetres. That is a problem that Victoria is facing.

The problem there is that broken glass contaminates paper, and once you have the broken glass in amongst the paper it makes it much more difficult to recycle the paper. In South Australia, because we have our deposit system, many of our glass containers are pre-sorted away from other waste so that it does not ever create that problem—it does to some extent, but not to the extent that New South Wales and Victoria have been finding. Nationally, more than 10 per cent of paper goes to landfill because of the contamination of glass, but in South Australia it is only 1.7 per cent. I think that speaks for itself about our deposit regime.

I refer to the Sustainable Futures report and its response to the packaging industry. It is very interesting that in the past couple of weeks there has been an announcement that this problem at the Chullora recycling facility has been solved. The following is an article from the website sustainabilitymatters.net.au:

WSN Environmental Solutions and joint venture partner Australian Glass Technologies are launching a facility capable of processing up to 40,000 tonnes per year of previously unwanted glass. The facility at WSN's Chullora Recycling Centre will transform small pieces of glass into a valuable resource and open up markets in New South Wales. The recycling facility crushes the glass, which is then sold as granules that can be used in the manufacture of bricks, water filtration medium, pavers and roof tiles.

Up until now, glass that was shattered in the recovery process has been difficult to process and often had to be sent to landfill. The facility sorts the recycled glass from fine powder to larger pieces, with each size being used as an additive in the manufacture of a broad range of products. In addition to building materials, the recycled glass can also be used as an abrasive in sand blasting and as a filtration system for pools, while coloured pieces of glass can be used as decorative features in pot plants.

The article goes on to say that, in getting this project together, the National Packaging Covenant has provided a grant of $400,000 to Australian Glass Technologies. What is interesting to observe is that it has been seven years since Sustainable Futures put that report together for the New South Wales government. What this article does not say is that it costs about $3 million, I understand, to set up such a plant. When one considers how we do it with our deposit system, one will see that it is a much more efficient way to do it.

I observe that, for the most part, plastic comes from oil and an increasing amount of our containers are made from plastic. From that perspective, given what we know about peak oil, I think there is a real imperative to reduce the usage of plastic bottles and do whatever we can to make sure that what we have is recycled. Glass, aluminium and plastic all have embodied energy in them from their manufacture, and aluminium is often referred to as congealed energy. I believe that we should be addressing this issue in the context of reducing climate change emissions that come from energy use.

I also remember that at least one of the submissions to the Environment, Resources and Development Committee suggested that we needed to include wine and spirit bottles as part of the deposit legislation. So, I would be interested to hear what the minister has to say about that. I would also like the minister to advise me whether she and her department, when they were drafting clause 7 of the bill, considered including something in new section 64E that recognises that our container deposit scheme also positively impacts on South Australia's efforts to address greenhouse gasses. I do recall that, when the High Court challenge was on about South Australia's deposit legislation in the 1980s, there was some argument about the intention of the legislation. As a state, we were arguing that it was about reducing waste and the benefits to the environment, while those who were opposing it were seeing it is a constraint on trade.

I truly believe that the impact it has to make in terms of climate change ought now to be recognised in the legislation. As I say, I would like to hear from the minister about that particular aspect. I probably will have an amendment to do that, unless she is able to give me very good reasons why I should not do so. This legislation still does not put a true value on containers but, bit by bit, I think we are edging in the right direction, and for that reason the Democrats will be supporting this bill.

The Hon. M. PARNELL (20:11): The Greens support this bill, which will strengthen the container deposit legislation provisions of the Environment Protection Act 1993. When container deposit legislation was first introduced in 1975, it was primarily seen as a tool to control litter and, in particular, drink containers—bottles and cans—that covered our roadside verges from one end of the country to the other. I think it has been a point of pride amongst South Australians that, over the past 30 years, we have been able to see that most of that litter now tends to stop at the South Australian border. Who here has not had a conversation with someone who has travelled saying, 'I noticed as soon as I crossed the border that I started seeing the bottles and cans again'.

The system has worked fairly well over many years, not the least of which is that it has changed our behaviour towards waste, and it has also been a major incentive to promote recycling. Most of this legislation is about behavioural change, and that is important because, until the recent announcement of putting up the deposit from 5¢ to 10¢, the deposit certainly has not kept pace with inflation. I understand that, if it had followed inflation, the deposit would now be 30¢, and that raises all sorts of issues about whether the container deposit legislation should be a mechanism to spawn industries to make money or whether there is a social benefit in keeping the deposit fairly low to encourage charities and even casual bin collectors. That is a debate that we can have as well.

The most important thing for me about this legislation is that container deposit legislation is now seen to be much more than just a litter control mechanism. Now it is about recovering valuable resources, reducing greenhouse pollution and even saving water. As the Hon. Sandra Kanck mentioned, much of the debate has been contentious, in particular in relation to savings and benefits. However, because I am interested to look at this recycling scheme from an energy saving point of view, I found a couple of local sources which seem fairly clear to me to be well based on research and science and which shows that there are genuine savings. For example, Clean Up Australia, an organisation that has been referred to previously, talks about the energy saving to be had in manufacturing glass from recycled cullet.

The main reason that it saves energy is that the recycled glass melts at a lower temperature than the virgin raw materials, and because they do not have to be heated to the same temperature, less fuel is required—and we are mostly talking about fossil fuels, oil and gas and, to a lesser extent, coal—which means that there are greenhouse benefits.

According to Clean Up Australia, making glass from recycled materials requires only 40 per cent of the energy used to make glass from sand. Another organisation close to home, KESAB, provides on its website a more detailed analysis of the costs and benefits of recycling and, again, looking just at the case study of glass, the organisation points out that using cullet for glass-making not only uses less energy but also enhances furnace life, so capital savings can be made as well.

KESAB estimates that, for every tonne of glass cullet reused, an equivalent of 135 litres of oil is saved in terms of production process in the furnace, extraction and transportation. KESAB points to another study which estimates that recycling glass containers saves between 13 and 25 per cent of the energy needed to make glass from virgin raw materials; and a third study it refers to talks about glass made from 100 per cent cullet using 20 to 35 per cent less energy than glass made wholly from virgin raw materials.

On the other hand—and this has been referred to before—some with vested interests in the packaging industry like to cite figures to show that there is, in fact, no benefit environmental or otherwise in recycling, and it is not that difficult to come up with a set of circumstances that might, for example, involve truckloads of glass travelling halfway across the country and taking into account the fuel used in that process before you can make a case for recycling not being efficient environmentally. But the point is that if we do this properly and we do it locally, there are clear savings in terms of energy use and, therefore, in relation to greenhouse gas emissions.

Another reason why I think this container deposit legislation is important is that it points to some further steps we will have to take as a society in the future and, by that, I mean that we need to engage in a debate about the appropriate level of responsibility that manufacturers of products (in particular, manufacturers of packages) have in order to take responsibility for their waste. At present, very little responsibility is taken by industry. There are incentives on end consumers—that is, members of the public—in that they can get a small deposit or they can get a feel-good factor if they put their recycling bin out on the kerb, but very little responsibility is attached to the manufacturers.

Another objective of this bill is to stop beverage containers purchased interstate, on which no deposit has been paid, from being cashed in here in South Australia. The mechanism is to provide for proof of purchase or certain declarations can be required in cases where large numbers of containers are presented for a deposit refund. The need for this provision, to me, highlights the importance of moving to a national scheme eventually or at least complementary legislation in the other states. From our perspective, that means New South Wales and Victoria should be the priority being the two states with the highest levels of interstate traffic with South Australia across our borders.

The Greens in the parliaments of the other states and territories have moved (or are about to move) for this type of legislation to be introduced into their jurisdictions. Most of my interstate colleagues' container deposit bills go much further than the South Australian scheme. For example, most Greens bills in other states incorporate paperboard as well. But to go back to where I started and talk about this as a litter control mechanism, if that remains our focus, then we will only ever apply a scheme like this to things that are known to end up in the litter stream when we should be concerned about things that end up in landfill and we should be concerned about things where recycling results in savings of resources, fuel and water.

So, there is no reason why a peanut butter jar eventually should not attract some level of deposit if we find that voluntary measures such as kerbside recycling do not of themselves work. I would be interested to see the statistics and I would be interested if the minister could provide us with any statistics about whether items other than beverage containers could have increased recycling rates if they were subject to a deposit.

The final point I make is that, with these moves happening interstate (and it is not just Greens members in other parliaments; other state governments are now seriously talking about this sort of legislation in their state), I do not think it will be very long before our leadership in this area is overtaken by some other jurisdiction. It is one of those things that we see in this place a lot, where innovative legislation of 20 or 30 years ago serves us well for a while, but we very quickly lose the forefront position we had as other states take over. So, there is an opportunity for us to take the example of CDL and extend it to other items where there are clear benefits from recycling. With those words, I indicate that the Greens are happy to support this legislation.

Debate adjourned on motion of Hon. B.V. Finnigan.

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