Topic Area: Solid Waste Management
Geographic Area: Ireland
Focal Question: What were the effects of the Plastic Bag Environmental Levy on the litter problem in Ireland?
Sources: * “The 10 steps: Information Note on Plastic Bag Governmental Levy”, An Roinn Comhshaoil agus Rialtais Aituil [Department of the Environment and Local Government], (January, 2002).
* “Plastic Bag Environmental Levy: The Irish Experience”, A presentation to Victorian Division P.C.A., Melbourne given by Gerry Allen, CEO Smurfit Irish Paper Sacks, (November 2002).
* “Shoppers still bagging plastic sales”, The Irish Examiner, (January 2003).
Reviewer: Linda Dungan (Visiting Student)
The litter problem in Ireland has been at the forefront of Irish environmental concerns for the last number of years. Rapid economic growth in the 1990’s was marked by a significant increase in the amount of solid waste per capita. The lack of adequate landfill sites resulted in escalating costs of waste disposal, which in turn led to more frequent incidents of illegal dumping and littering.
The litter problem was a prominent issue for the government because of the severe damage it was inflicting on the Irish ‘green image’. It was feared that tourism, one of Irelands largest industries, would be negatively affected as a consequence of the degradation of the environment. The food industry, which based a significant amount of their marketing strategies on a healthy, wholesome reputation, also suffered as a result of the increased litter and pollution.
The most visible element of litter was plastic bags, so the government set about reducing this particular component of waste. Each year, 19,000 supermarkets and other retail outlets around the country provided to Irish consumers 1.26 billion plastic bags, free of charge. This translates to roughly 14,000 tons of plastic and 325 bags per consumer, per annum. A staggering 99.5% of this plastic was eventually sent to landfill sites or became litter on roadsides, in parks and along the coastline.
On March 4th, 2002, the government introduced the Plastic Bag Environmental Levy on all plastic shopping bags, with a few exceptions on bags used for dairy products, fruits and vegetables, confectionary items, meat and fish. These exemptions were sanctioned for health and safety reasons. Retailers were charged a fee of 15c per plastic bag, which they were obliged, by the government, to pass on to the consumer. This levy was designed to alter consumer behavior and create financial incentives for consumers to choose more environmentally friendly alternatives to plastic, such as ‘bags-for-life’ or paper bags.
Bags-for-life are heavy-duty, re-usable cloth or woven bags, which are available in all supermarkets, at an average cost of €1.27. Paper bags are not being used as a substitute in supermarkets, but are primarily provided in clothing and retail outlets, free of charge. Since impulse purchases account for a larger percentage of total sales in luxury and non-essential-goods markets, customers might not have planned ahead and brought their own bag. In this instance, it is more convenient for retailers to supply paper bags.
The Revenue Commissioners, working in conjunction with the Department of the Environment and Local Government, are responsible for collecting the levy from the various supermarkets and retailers. Retailers, for their part, are required to keep comprehensive records on the number of plastic bags they purchase and subsequently sell to customers. Payment is due quarterly, and is paid by electronically debiting the amount from the retailer’s bank account. This method of payment is regarded as the most efficient and cost-effective method. Since retailers are obliged to bear the related compliance and administration costs, the government wished to minimize these costs in order to maximize compliance with the levy. It is estimated that these costs are offset by the savings made by retailers from no longer providing disposable bags to customers free of charge, as well as the profit margin earned on the sale of ‘bags-for-life’ whose sales have increased by 600%-700% since the introduction of the levy.
It was first hoped that this levy would bring about a 50% reduction in the number of plastic bags used, but this figure is currently estimated at 95%! In a single year, Irish consumers reduced their consumption of plastic bags from 1.26 billion p.a. to 120,000 p.a., while concurrently raising approximately €10 million for the Irish Revenue Commissioners. This collected revenue was placed in the Environmental Fund, which will be used in the future to finance environmental initiatives such as recycling, waste management and, most importantly, anti-litter campaigns.
This levy has been viewed as a major success by the government and environmental groups alike. It has also been enthusiastically embraced by Irish consumers, thanks to an intensive environmental awareness campaign that was launched in conjunction with the levy. Irish retailers, although skeptical in the beginning, have also recognized the huge benefits of this levy. The amount of plastic being sent to Irish landfills has been dramatically reduced, bringing about a clear, visual improvement in cities, on coastlines and in the countryside due to the decrease of litter. The Department of the Environment has received a number of calls from a multitude of countries expressing interest in the levy, including Australia, New Zealand, and Britain. It is hoped that many other countries will adopt similar policies in the future, which will further reduce the unnecessary use of plastic bags around the world.