Third Sector has caused a stir this week with its article on the plastic bag levy. According to the transcript of a meeting held last month, Dan Rogerson, the Liberal Democrat environment minister, told the Environmental Audit Committee that he expected the charge to raise a total of £95m a year – £70m of which “would go straight to good causes.”
5p charge on plastic bags
Everyone is in agreement that the plastic bag levy (a 5p charge on plastic bags from retail outlets) is long overdue and has clear environmental benefits. However, beyond that, there are lots of questions, queries, uncertainties and a fair dollop of understandable dismay.
The first obvious query is around how much the levy is likely to raise. The amount of £70m a year sounds optimistic given the key objective is to encourage people to stop using plastic bags. The introduction of the levy in Ireland back in 2002 led to a drop from an estimated 328 bags per person per year to 21 bags per person by the end of 2012. In July 2012, the Welsh Government released a brief summary covering 13 retailers which showed reductions of 35 – 96% since the launch of their charge. So it’s clear that the levy does work. After being stung for 40p or so for a few weeks at Tesco’s, people do start to wise up. Gone are the days of ‘double bagging.’
How to put this money to use?
Setting aside uncertainty over specific amounts , the levy is still likely to raise a huge amount of money. In Ireland the figure so far stands at over 203m euros (£168million) for a country with a much smaller population than England.
[quote align=”right” color=”#999999″]This funding needs to be managed, accounted for and distributed properly.[/quote]
So how will all this money be put to use? Last September when the initiative was first announced, there was a clear leaning towards environmental charities. There now appears to be a preference for leaving the decision making in the hands of the retailers who charge for the bags. This throws up further questions…
- How can the government be sure that the money will actually go to charity? It has been clearly stated that there is no intention to pass legislation to require retailers to give it to good causes. There is simply a belief that they will do so due to the reputational risks if they don’t. Other than the large retailers who will be under the spotlight, this could potentially end up being a nice little earner for lots of businesses.
- How can we be certain that funds distributed by retailers from the levy won’t simply displace other funding which they may otherwise have donated to charity? Surely it is important to make sure that this money is additional?
- Why should retailers benefit at all from a halo effect from distributing money to charities arising out of what is akin to a tax? Arguably, it’s not the retailers’ money to determine what to do with in any event.
This funding needs to be managed, accounted for and distributed properly. There are obvious candidates such as the Big Lottery Fund or the network of Community Foundations that are far better placed to do this than retailers.
All these questions need to be addressed properly. With almost half the charities in England having an annual income of less than £10,000 per annum, the sector needs to act with a concerted voice with someone at the helm.
So who will be taking the lead? DSC, NAVCA and Small Charities Coalition have all raised their eyebrows but who is going to be the first to pick up the phone and suggest a meeting to formulate a plan of action?
The plastic bag levy is not due to come into force until October 2015 so there is time to sort this out for the benefit of the whole sector in England but I for one suggest we don’t let the months slip by.
Mark Atkinson is Chief Executive of VCSchange, which delivers breakthrough solutions for voluntary and community sector organisations. Their mission is to support the creation of strong and vibrant voluntary and community sector organisations through well thought through, carefully planned and expertly executed change.
Photo: plastic bags by daizuoxin on Shutterstock.com