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Thursday, 22 November 2012
Page: 9504


Senator BIRMINGHAM (South Australia) (12:37): I am delighted to have learned from listening to Senator Whish-Wilson that you and I, Senator Ruston and Senator Farrell live in some type of litter and recycling nirvana. Where we are is obviously heaven on earth compared to everywhere else—and it is. It is a wonderful place to live, as we know. But I am not convinced that everything we have heard from Senator Whish-Wilson by any means stacks up to the most basic of fact checks or proofing. Firstly, seeing as Senator Whish-Wilson decided to dedicate the first part of his speech to responding to Senator Ruston, I might dedicate a little bit of time to responding to Senator Whish-Wilson before I reflect on the report of the inquiry that I was pleased to chair.

Senator Whish-Wilson claimed in one part of his speech that this type of scheme is the most efficient system we have but then in a different part of his speech that it was a very inefficient system. There was a complete contradiction even within the same speech. Throughout this inquiry, in much of what we heard from Senator Whish-Wilson's questioning, his approach was to question the inefficiencies in the systems of container deposit legislation in place.

He claimed that it was a market based system, not a regulation but an incentive. That is really quite remarkable, I think, for anybody. It is not regulatory, not a regulation? This is a system where the state government legislates to require that a 10c deposit be paid to anybody who returns a certain type of container to a certain type of place. That sounds very much like regulation to me. There is no variance in the price. The state government legislates that it be 10c. It is a fixed price. There is no market in terms of recognising that some of the products returned—say, aluminium cans—are worth an awful lot more than some of the other products returned. Some of them have greater value to recycling than other products.

Senator Whish-Wilson also claimed that evidence provided 'has proven profiteering by Coca-Cola'. Of course, I have not seen the minority report put down by Senator Whish-Wilson. I look forward to reading that and seeing how he has demonstrated and proven his claim of profiteering through the scheme by Coca-Cola. I think anybody with a relatively simple analysis of what occurs in the food and beverages grocery sector would acknowledge that it is a pretty competitive sector. They would acknowledge that at the retail level retailers fight for market share and at the wholesale and manufacturing level there is equally a fight for market share that occurs to maximise profits but to maximise profits in the most effective way—by maximising your sales and margin combinations.

I do not think through this inquiry we saw any credible evidence to support the claim of profiteering through these schemes. If anything, analysis undertaken at all manner of levels indicates that these schemes cost. They come at a cost. There is a merit based argument that can be made about the treatment of litter and the benefits of recycling, and I acknowledge those merit based arguments. We should acknowledge, though, that much has changed since the South Australian scheme was first enacted in the 1970s. Kerbside recycling did not exist then. In fact, very little of the recycling activities that we see today existed then. The scheme was tackling a very different problem to those that we look at today.

In talking about Tasmania, Senator Whish-Wilson suggested that if such a scheme were implemented there it could create hundreds of new jobs. Yet he claims that it all comes at no cost. You do not create new jobs in a sector like this without there being some cost application to fund those jobs.

Senator Whish-Wilson interjecting

Senator BIRMINGHAM: 'It does not cost the taxpayers.' It costs the consumers—that is right, Senator Whish-Wilson. It costs the consumers, because the costs will be passed through to the consumers, who will pay more—

Senator Fifield interjecting

Senator BIRMINGHAM: and who in large part are the same people as taxpayers. Thank you, Senator Fifield. Consumers, taxpayers, Australians, Tasmanians—whoever they are—will end up footing the bill through higher costs.

This inquiry did not, however, seek to take on board the merits of having a container deposit scheme or not. It really was a narrow inquiry that looked very much at the operation of the South Australian and Northern Territory schemes and some of these claims of profiteering that I think were firmly rebuked. The inquiry made some clear recommendations, though. In terms of claims of price impacts, anybody who decides to go down this path in future at a national or a state level should make sure that, just as was the case when the GST or the carbon tax was introduced, there are tests so that anybody who makes false claims as to the price impacts can be held to account for making such false claims. In terms of return rates of products, there should be transparency to give confidence and in terms of disputes that may occur within the scheme, there should be some clear dispute resolution mechanisms.

I particularly want to highlight the last recommendation of the report, which relates to the treatment of small containers—containers of less than 100 millilitres in size—that require refrigeration. I urge the South Australian and Northern Territory governments to exempt them. Perhaps the best known of these types of containers are the small Yakult products. They are consumed in the home, they have to be kept refrigerated and they will be captured through kerbside recycling without a container deposit scheme being in place. The committee has recommended that they be treated just as a litre of milk is treated because they are consumed, by and large, just as a litre of milk is consumed—that is, they should be exempt from the schemes. I would urge the South Australian and Northern Territory governments to look at that because it is placing an unfair cost burden on a number of small companies who produce these products. With that, I commend the report to the Senate.

Debate interrupted.