Winemakers fight changes to SA container deposit scheme

February 26, 2019
By Alana House

Australian Grape & Wine has opposed moves to include wine bottles in South Australia’s Container Deposit Scheme.

According to AGW, it could cost South Australian wine businesses around $5 million per year and jeopardise the financial sustainability of the wine sector.

It says producers will struggle to bear direct costs including payment of the cost of providing for a refund for deposited containers via a quarterly bill, container label registration, and handling fees. Associated costs would include administrative and compliance costs, quarterly reporting requirements and the redesign and re-printing of labels.

The association noted: “In a very tight retail environment, it is a myth to suggest the producer can pass these costs on to consumers.” 

“These costs would be felt by many small businesses that contribute so much to rural and regional economies in South Australia,” added Tony Battaglene, CEO of Australian Grape & Wine. 

AGW believes changing the CDS to include wine bottles has the potential to jeopardise the financial sustainability of the wine sector, which could have dramatic flow on impacts throughout the supply chain including an impact on regional employment. 

Committed to the environment

Battaglene said AGW was committed to sustainable environmental practices and strongly supported recycling as a part of its environmental commitment. However “no compelling evidence has been presented to support the inclusion of wine bottles in South Australia’s CDS.”  

The South Australian Government is undertaking a review of its CDS, including whether or not any other containers should be included in the scheme.

The primary purpose of the CDS is to reduce the amount of beverage containers found in the litter stream. Since South Australia introduced the scheme in 1977, wine bottles have been exempt on the basis that they represent less than 0.04% of South Australia’s litter stream.

This reflects the fact that almost all wine bottles are enjoyed in the home or at licensed premises. No other states or territories include wine bottles in their CDS arrangements even after the introduction of CDS legislation in NSW and Qld in 2018 and 2017 respectively.

“Good public policy is built upon a strong evidence base, and a proper weighing-up of costs and benefits,” said Battaglene. “South Australia’s CDS has been a strong driver of litter reduction in public spaces without wine bottles being included, and with a focus on resource recovery, there is no evidence to suggest that CDS will be the appropriate vehicle. However, the costs to South Australian wine businesses and that economy are very clear and there are also potential flow on implications for the wider Australian industry.

“Australian Grape & Wine strongly supports the efforts of the South Australian Wine Industry Association (SAWIA) inform South Australian wine businesses about the potential impact this review could have on their operations. We echo SAWIA’s call to make sure businesses engage in the consultation process and encourage people to speak to their local member of parliament.

“We wonder why the government is considering such a move as part of its review. Surely a government that does so much to promote South Australian wine businesses wouldn’t then want to impose unjustifiable costs on the sector?”

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