R1.4bn from plastic bag levy put to good use, says DEA

Over R1.4billion has been collected since 2004 through the plastic bag levy that consumers pay for plastic shopping bags at till points. The levy, which increased to 12c/plastic bag (from 8c) on 1 April 2018, is worked into the cost of the plastic bag and is paid by the manufacturer of the bag to SARS.

The purpose of this environmental tax is to assist in reducing litter, by changing consumer behaviour away from relying on single-use carrier bags, and also to use the funds collected to set up recycling centres and create jobs to help tackle the problem of plastic pollution. The tax is collected by SARS and these funds go into the national ‘kitty’.

“The National Revenue Fund is a general fund from which appropriations are made, and there is no earmarking of funds collected, therefore, it is not possible to draw a direct link between the amounts collected for a specific tax or levy with any specific expenditure. However, R1.66billion of the Department of Environmental Affairs’ total allocation as appropriated from the National Revenue Fund was set aside since 2004/5 to 2016/17 for waste minimisation and recycling initiatives,” says Department of Environmental Affairs (DEA) spokesperson Albi Modise.

This means that the department is getting slightly more than is raised through the levy to tackle the litter problem through waste minimisation and recycling initiatives.

The DEA says the levy is working and the goal of less plastic pollution is being achieved with the help of the money generated. “Consumer behaviour has been affected wherein consumers have been encouraged to use reusable bags. There is also an added benefit on investment in infrastructure development for waste diversion and to maximise the recycling economy,” says Modise.

He adds that “infrastructure development including buy-back centres, transfer stations, beneficiation centres, and treatment plants have been established. Projects have been implemented to stimulate recycling by SMMEs, communities and civil society organisations.”

An example of this is the Atteridgeville buy-back centre, which in 2017 won an Eco-Logic award in the municipalities category.

A growing tax

Income from the levy has been steadily increasing year-on-year, which could indicate that increasingly more plastic bags are being produced. The income generated from this tax has risen from R41million in 2004/5 to R231million in 2016/17.

The levy increase (effective 1 April 2018) will be passed on to consumers who will be paying more for a plastic bag in stores. At Pick n Pay, customers will now pay 55c for a shopping bag (previously 50c), this incorporates the 4c levy increase and the VAT increase. Retailers state that they do not make any profit from the sale of plastic bags at the tills.

Plastic bags on fence
The plastic bag levy was implemented to reduce litter and dissuade consumers from buying plastic bags says National Treasury.

The alternatives

General manager sustainability at Pick n Pay, Andre Nel says plastic bag usage by customers dropped significantly after the introduction of the levy in 2003. The reuse of durable bags has become a habit for many shoppers. Pick n Pay provides a range of reusable bags in stores and R1 from the sale of each bag is donated to a community based programme.

The Township Group, a female-owned co-operative in the Western Cape that employs over 70 women has supplied Pick n Pay with over 600 000 reusable bags made from non-genetically modified cotton, since 2009. “In 2017, we sold almost 64 000 of their bags (a 47% increase on last year) and more than 1.29million Pick n Pay green bags, which are made form environmentally friendly fabric,” says Nel.

Retailer Woolworths says initially it saw a decrease in the number of plastic bags produced for Woolworths, but consumers have subsequently changed their behaviour and continue to purchase the plastic bag. Plastic bag usage at Woolworths decreased marginally with 0.83 bags used per transaction compared to 0.88 last year (as at June 2017).

While Woolworths says it has not yet been feasible to eliminate the sale of plastic bags at till points, it has taken a number of steps to reduce the impact of single-use plastics throughout all its operations. It adds that reusable bag sales remained fairly stable with 1.85million bags (FY2016: 1.89 million) sold in 2017. The introduction of the WW reusable (fabric) bag saw the formation of a community project focusing on the employment of disadvantaged woman who manufacture the bags.

We have some work to do in continuing to encourage customers to opt for reusable bags and in incentivising behaviour change,” notes Woolworths.

Plastic iceberg artist Jorge Gamboa
Tip of the iceberg by artist Jorge Gamboa.

Upstream changes

Plastics industry body PlasticsSA says the local plastics industry has come a long way since the introduction of the tax and various polymer groups have been formed within the industry to address and promote the recycling of all forms of plastic (not only plastic carrier bags) in a way that is environmentally responsible and sustainable. Opportunities have been created for the plastics industry to fulfil its extended producer responsibility (EPR) and develop strategies best suited to the consumer and the manufacturer’s needs.

EPR is a policy concept aimed at extending producers’ responsibility for their products to the post-consumer stage of their products’ life cycle. One of the outcomes of an effective EPR programme is to move waste management up the waste hierarchy away from final disposal in favour of recycling, minimisation and avoidance.

PlasticsSA says it has found that voluntary industry initiatives in the plastics industry such as PETCO – the PET Recycling Company, POLYCO, SAVA, Polystyrene Association of South Africa are more effective than mandatory, government-imposed regulations (as in the plastic bag industry) in stimulating plastics recovery.

Screen Shot 2018-04-05 at 2.50.18 PM
Stats from South Africa’s plastics recycling industry from PlasticsSA.

 

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