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EPIC criticizes Loblaw five cent bag fee


I thought readers would enjoy reading a news release from the Environment and Plastics Industry Council (EPIC) that’s critical of the move by Loblaw’s supermarkets to charge a nickel to customers for each plastic non-reusable bag they request for their groceries. I have inserted some comments in bold just to add my two cents (pun intended). — Guy Crittenden
CONSUMERS TO PAY MILLIONS WITH LAUNCH OF FIVE-CENT BAG FEE BY LOBLAW
Toronto (January 12, 2009) – Consumers are the losers with the implementation today of a five-cent charge on plastic shopping bags by Loblaw which has moved quickly to benefit from the City of Toronto proposal to charge for bags. The five-cent bag fee is an unnecessary $44 million hit to consumers on their food bills and retailers are the big winners.
The bags cost 1-cent and the Loblaw charge is 5-cents; a 500 per cent profit. Retailers are turning a cost item into a highly profitable source of revenue at the expense of consumers. For Loblaw, with its dominant share of the market, this is a major windfall profit of millions during a recession, particularly since the retailer is rushing to introduce the fee in Toronto six months ahead of the city mandated deadline so it can add as much as $15 million to their bottomline.
GUY ADDS: This is an interesting characterization of the issue. Plastic bags are a cost centre for stores. It seems odd to criticize retailers for reducing this kind of cost. If they make a profit of the kind EPIC claims, it will only be because consumers keep using and buying the same number of plastic bags, which is unlikely. The point of the fee is to encourage greater use of reusable bags — which no one disputes is a good thing to do — yet still give people the option of a plastic bag if they want the convenience, or to use a few each week in their below-the-sink kitchen catchers (as I do).
“With the Loblaw launch, the first shoe has dropped on the $44 million bag tax on consumers in Toronto. It is very hard to see this fee as anything other than a revenue grab during a recession”, said Cathy Cirko, Vice President, Environment and Plastics Industry Council.
“There is no question that this will add costs to consumers’ food bills. Consumers will now have to buy plastic bags if they want to participate in the city’s organics collection program and to get their household garbage to curbside. We doubt very much that Loblaw plans to lower the cost of their food to consumers,” said Cirko.
Currently, seven out of ten traditional plastic shopping bags are reused by residents for many purposes including household garbage and the city organics program. A fee could become a disincentive to participation in the organics program. Consumers lose even if they opt for a reusable bag.
As Cirko points out consumers are not going to use a reusable for their household garbage or to participate in the city organics program. They will now have to pay for bags; either five-cents for the traditional bag or 15-cents for a kitchen catcher or they can shop at stores that are not charging for bags.
GUY ADDS: This seems inflammatory to me. I like and respect Cathy Cirko, so this is not personal and I know she’s got a job to do, and I’m sure she believes what she’s saying. But you don’t absolutely have to use a bag for the organics program, and a new generation of compostable bags is on the market. Having to pay five cents or more for a kitchen catcher bag is actually an incentive to recycle and divert more (I know I do) so you save money by putting out less garbage. Isn’t this the whole point? So one can equally argue that the Loblaws levy not only encourages the use of reusable bags when shopping, but also greater waste diversion at home. I’m down to just two or three grocery bags per week for what I throw out, and I have two boys, plus no organics collection program in the condo where I live.
“If consumers opt for kitchen catchers, it will cost three times as much adding even more to the retailer bottomline; a win-win for retailers”, adds Cirko.
The industry is most concerned that the Loblaw focus and publicity around bag fees is a red herring sending the wrong message to consumers. And it could end up undermining and killing Toronto’s new blue bin recycling program for plastic shopping bags.
The addition of plastic shopping bags to the Toronto blue bin was seen as the first step to recycle a wide range of other plastic bags and film in packaged products sold by retailers like Loblaw – bread bags, toilet paper wrap, dry cleaning bags, produce bags, milk bags, vegetable bags, newspaper bags, etc. Toronto’s bags are being recycled by EFS Plastics Inc. in Elmira, Ont. and remanufactured right here in Ontario into new bags, drainage pipes, lawn edging, and a host of other made-in-Ontario products.
GUY ADDS: Missing from this argument is the cost of collecting and processing the plastic shopping bags and other film plastic. These are the most expensive items to collect and recycle, especially from an activity-based costing perspective. In today’s market I’d expect these to cost $1500/tonne or more. Whatever the number is, the fact is that these plastics are also being collected in only tiny amounts, perhaps because of the cost. I think an argument can be made that we should reduce our reliance on these plastics in all but the most essential cases (e.g., food safety, meat wrap, etc.) and recycle the rest 100 per cent paid for by industry, which should also pay for anything sent to disposal. EPIC is criticizing teh visible Loblaw fee, but not mentioning the huge hidden cost of collecting and recycling or disposing of film plastic. Let’s get all the numbers out there and have an honest debate.
“Consumers want to recycle, not pay unnecessary fees for bags,” contends Cirko. “The best thing Loblaw could do for the environment is promote recycling and educate consumers on the 3 R’s. We should not be continually exporting jobs to Asia. Retailers need to work with industry on solutions that grow jobs locally and help the environment,” said Cirko. According to the plastics industry, 10,900 Ontarians are employed in the manufacture of plastic bags and film.
International experience shows that bag fees actually hurt the environment. Plastic bags represent only 1 per cent of landfill and less than .5 per cent of litter. Everywhere bag fees have been implemented, they have failed. Consumers have responded by purchasing the heavier kitchen catcher type bags which contain 82 per cent more plastic and by using more paper bags. This has resulted in more resource consumption, more material going to landfill and the generation of even more greenhouse gases.
GUY SAYS: I direct readers to Maria Kelleher’s excellent recent article on the experience in Ireland, that they can access by searching on her name on the home page of www.solidwastemag.com She offers a different perspective.
“The best thing we can all do for the environment is buy locally-made products, reuse and recycle locally,” continues Cirko. “We don’t need to load these kinds of costs on consumers, but need to continue with public education, building recycling infrastructure and drive recycling. There are 44 million reasons why this is a better approach.”
GUYS SAYS: Once again, industry is pushing the recycling solution and not respecting the 3Rs hierarchy. I think the five cent fee is a reasonable compromise compared to, say, an outright ban on plastic bags. Let’s face it, a lot of people will keep using and buying these bags, but lots will also use their reusable bags, too. If the plastics industry had to participate in full Extended Producer Responsibility for plastic shopping bags, and pay for all net collection, recycling and disposal costs, would the industry feel the same way? it’ll be interested to see what the five cent fee actually accomplishes. Readers are invited to email their opinions to the magazine.
The Environment and Plastics Industry Council (EPIC), a council, is part of the Canadian Plastics Industry Association (CPIA), is dedicated to sustainable plastics recycling and to minimizing plastic waste sent to landfill.
For more information, contact:
Aydan Raghavan/Jaclyn Clare
416-777-0368


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