Cash back cost ‘60pc’
CONTAINER RETURN SCHEME BLOW OUT
SUPERMARKETS are warning some drink prices could rise 60 per cent when WA’s container deposit scheme takes effect, costing thirsty West Australians an extra $300 million a year.
Under the cash-for-containers proposal — due to come into force in 2020 in a bid to lift the State’s low recycling rates — consumers will be paid 10¢ for drink cans, soft drink bottles, bottled waters, flavoured milks and sports drinks between 150ml and three litres.
But Woolworths has warned that, when handling and administration costs are added, the cost of every drink in a recyclable container could rise by as much as 15¢ — and the price hike will almost entirely be passed on to consumers.
The supermarket giant said the cost of $1 drinks would come to about $1.15 but a 24-pack of 600ml water bottles could rise from $6 to $9.60 — a 60 per cent hike.
In a submission to the WA Government — which Woolworths this week said it stood by — the supermarket chain’s government relations manager Richard Fifer said the “overwhelming cost impact” of the scheme would fall on WA shoppers who could “expect a significant price rise on all recyclable products across the board”.
Woolworths said that in NSW, which adopted a container deposit scheme in December, consumers were paying about 12¢ more for each can or bottle and it estimated the extra cost for NSW shoppers at $420 million a year, in part because many containers were not being returned for the 10¢ refund.
Woolworths warned the WA scheme would be “significantly more” expensive — at up to 15¢ per container — because of the State’s size and lower population, with the Consumers’ Association of WA estimating the cost for WA beverage drinkers at $300 million a year more.
The supermarket said based on its experience in SA and the NT, which already operate the scheme, the “vast majority” of drink containers were still dumped in kerbside recycling bins.
Environment Minister Stephen Dawson said big price rises were unlikely but the “cost of beverages may be marginally above the 10¢ refund that they will get for returning eligible drink containers to refund points”. “The actual price rise will vary depending on scheme costs, margins added by producers or retailers, and the extent of product discounting. Experience in other States is that scheme costs are around the 10¢ per container mark,” he said.
A review of the NSW scheme showed drink prices had risen between 6¢ and 13¢.
“So for people who bother to get the 10¢ back, for some containers they could actually end up saving money,” Conservation Council WA director Piers Verstegen said.
He said most people would “accept modest price increases given the environmental benefits and jobs created by the scheme”.