Plastic Bags - COAG Standing Council on Environment and Water

4. Is government intervention required?
5
10
15
20
25
30
35
The main justification for further government intervention is the market failure caused by
environmental externalities associated with littered plastic bags. A further reason for government
intervention is the public-good nature of litter abatement. In both cases, it is unlikely that the
market will find a solution without further government intervention. Mandatory action by
governments would create a level playing field for retailers - a diverse sector that consists of more
than 200,000 retailers that may potentially distribute plastic bags. 66
Although there has been a significant reduction in the use of plastic bags in recent years, there is
reason to believe that further voluntary reductions will be very difficult to achieve, and will
require well resourced and well targeted strategies. From 2002 to 2004, plastic-bag use fell from
5.95 billion in 2002 to 4.73 billion in 2004 – a decrease of 1.22 billion. However, from 2004 to 2005,
plastic bag use is estimated to have fallen from 4.73 billion to 3.95 billion in 2005 – a decrease of
780 million. This indicates that the rate of voluntary reductions may be slowing. Based on reports
from retailers, Hyder Consulting confirms that the rate of decline in bag use by Group One
retailers has slowed over recent years. In 2002, supermarkets provided 3.64 billion HDPE bags to
customers. In 2004, they provided 2.73 billion, a reduction of 0.91 billion. In 2005, supermarkets
provided 2.14 billion HDPE bags to customers, a fall of 0.59 billion bags from the previous year.
This also is supported by a report from ANRA to EPHC in June 2006 that indicates that measures
undertaken up until 2005 are likely to have achieved their maximum results and that new
measures which capture a broader range of smaller retailers, such as take-away businesses, are
required to improve on current reduction levels.
Although the reduction across the non-supermarket sector has been lower, there are exceptions.
Where retailers have voluntarily introduced a charge on plastic bags the observed reduction has
been much greater at around 80 percent. 67
Importantly, the reduction in plastic bag use to date has not produced evidence to demonstrate
that this has resulted in a commensurate fall in the amount of plastic bag litter, as noted earlier,
Clean Up Australia and Keep Australia Beautiful report minimal change in plastic bag litter
levels. 68 As mentioned in section 3.4 it is unclear how severe bag reductions will need to be before
a significant reduction in plastic bag litter will be noticed.
As a general comment voluntary initiatives can provide more flexibility in application for
businesses and they generally lead to lower administrative costs and faster implementation than
regulation. However, voluntary initiatives by themselves may not be successful where:
66 In 2004 ABS figures indicated there were around retail 200,000 businesses, excluding motor vehicle
retailers, Note not all retailers may distribute plastic bags.
http://www.ausstats.abs.gov.au/ausstats/subscriber.nsf/0/090DA0FCAF499A6CCA257092007506D3/$Fil
e/8161055001_jun%202004.pdf (Accessed 9/1/07).
67 Australian Bureau of Statistics – Australia’s Environment: Issues and Trends 2006
http://www.ausstats.abs.gov.au/ausstats/subscriber.nsf/0/5BC32E8955FEF5E3CA2572210019AF02/$File/
46130_2006.pdf (Accessed 9/1/2007)
68 Keep Australia Beautiful National Litter Index 2005 and 2006; and Clean Up Australia Rubbish Report
2002 and 2005
Consultation Regulatory Impact Statement: Investigation of options to reduce the environmental impact of plastic bags January 2007 32