What is the National Packaging Covenant?The National Packaging Covenant is the leading instrument to minimise the environmental impacts of consumer packaging waste throughout the entire life cycle of the product packaging. A key aim is to develop economically viable and sustainable recycling collection systems. Implementation of the NPC is coordinated by the National Packaging Council. http://www.environment.gov.au/epg/Covenant/
What does the National Packaging Covenant require of our Organisation?
· Action Plans for your company to minimise environmental effects of product packaging over a 5 year period. (see section 5) .
· Financial Contribution over 3 years to support development of the kerbside recycling system (see section 4).
Section 1
Do we have to sign the Covenant?
No, but if your company doesn't sign the NPC it will be subject to the National Environment Protection Measure (NEPM) being enforced through state legislation. The NEPM which targets "Brand Owners", will provide a complementary regulatory safety net affecting many of those who do not sign the Covenant. The Covenant is a voluntary scheme and reasonably flexible whereas the NEPM is relatively prescriptive and inflexible.
In NSW, the NEPM is being implemented through the EPA, by the Industry Waste Reduction Plan (IWRP) for Used Packaging Material, which commenced in July 2000. (Available from NSW Environment Protection Authority, those companies not signed up to the Packaging Covenant may be subject to the NSW IWRP (http://www.epa.nsw.gov.au/waste/iwrp.htm). For a quick reference to see if your company may be affected by the IWRP, follow the decision tree provided on last page.
Section 2
Why is the path of the Covenant a good option?
It is a self-regulatory agreement between industries in the packaging chain and all spheres of government, based on the principles of shared responsibility through product stewardship, and applied throughout the packaging chain, from raw material suppliers to retailers, and the ultimate disposal of waste packaging.
It is not prescriptive, does not tell companies how to make their packaging or what type of packaging to use; nor does it implement regulation requiring businesses to take back materials recovered from kerbside recycling collection programs.
By supporting this initiative the industry is displaying to the government a commitment and ability to be self-regulated in this area. If industry in general does not support this initiative there is the alternative, when the process is reviewed in four years time, that more prescriptive and less flexible measures will be implemented. These would undoubtedly translate into actions that may not be as easily implemented and higher costs.
Section 3
What is the industry response to the National Packaging Covenant?
Industry wide the Covenant has been signed by a range of industry associations, corporations and local governments, with the current total at over 170 signatories.
List of current signatories can be found at: http://www.environment.gov.au/epg/Covenant/signatories.html
Section 4
What are the costs involved?
Once signed to the Covenant, each signatory in the packaging supply chain undertakes to contribute to the industry portion of the cost of the Transitional Funding Arrangements.
The funding goes towards studies and other measures to make kerbside collection programs more cost-effective and to strengthen and expand markets for collected materials. The objective is a sustainable, market-based recycling system.
A schedule of contributions has been developed for industry Covenant signatories. It sets out the annual contribution to the Transitional Arrangements to be made over three years and is based on the organisation's position in the packaging supply chain and it's turnover in packaging-related sales. For example, for a company involved as a user of packaging with an annual turnover of $25-50M the contribution amounts to $400 per year for three years. If the turnover is $500-$750m the contribution is $7,000per year. Exports are excluded.
An industry association- National Packaging Council (Transitional Arrangements) Industry Association. Inc.- has been established to raise and manage the industry contribution.
Section 5
What is an Action Plan?
The second requirement for signatories is to produce an Action Plan, which will address the commitments of the organisation in regards to product stewardship and effective environmental management of packaging throughout its life cycle. As from June 1 2001,the time allowed to prepare the initial Action Plan has been reduced from 12 months to 6 months from signing. You can submit one Action Plan to cover the full 5 year period, or submit yearly plans.
Signatories are required to keep adequate records of their achievements against the targets of the Action Plan. At the end of each financial year an Action Plan Report is to be lodged with the Covenant Council.
What is contained within an Action Plan?
The Action Plan sets out what actions you will take to contribute to reducing the amount of packaging waste in the domestic waste stream, and when you will implement the actions. Action Plans are public documents. Existing company Action Plans are available to view at: http://www.packcoun.com.au/
There are four broad areas companies can address, such as reducing or lightweighting packaging, standardising packaging, reducing bulk or transport packaging and labelling information regarding opportunities for re-use or recycling. If these areas offer limited scope, the covenant says "be open minded and creative" in defining opportunities. You could target internal improvements in production or pre-production packaging waste. For many companies, your existing waste minimisation and environment improvement activities will provide a sound framework for the initial Covenant Action Plan.
Guidelines on the development of Action Plans are available at: http://www.environment.gov.au/epg/Covenant/action_plan.html
How much time is involved in creating an Action Plan?
To be consistent with the goals of the Covenant, the Action Plan requires the understanding and commitment of Senior Management. Areas like marketing have a major effect on packaging- don't just pass it onto your environmental manager "to handle", and hope to hear no more about it!
The costs of developing an Action Plan will be dependent on the size and scope of your operations. A medium sized business (approximately 150 - 300 people) should allow approximately 20 working days to complete the whole process of Action Plan development through to reporting. This could be reduced by working and sharing approaches with other companies.
Section 6
A few facts on the IWRP for Used Packaging Materials.
In NSW, the NEPM is being implemented by the Industry Waste Reduction Plan (IWRP) for Used Packaging Material.
What are the obligations of brand owners?
· Brand owners must systematically recover, reuse and recycle the used packaging materials to which this plan applies
· Inform consumers as to how the packaging is to be recovered.
· Collect and record detailed information regarding the materials to which this plan applies.
What are the materials to which the NSW IWRP applies and the target recovery rates?
50% 60% 60% 45% 45% 75% 50% Similar targets are required by the EPA in Victoria.
What happens if we fail to comply with the requirements of the NEPM?
The NSW, the EPA will serve you with a notice of contravention outlining the infringement and requiring corrective action. If your company does not comply to this notice within the time allotted then you may be subject to financial penalties which are up to $125,000 for corporations and for a continuing offence up to an further $60,000 per day.
In Victoria the relevant legislation is the "State Environmental Protection Policy for Used Packaging Materials (SEPP). (www.epa.vic.gov.au). A letter requiring a response within 30 days to either signing the Covenant or being subject to SEPP is being mailed to relevant companies.
Quick References
General information on the National Packaging Covenant : http://www.environment.gov.au/epg/covenant/
Examples of Existing Action Plans can be found on the Packaging Council website : http://www.packcoun.com.au
NSW - Industry Waste Reduction Plan legislation information available from the NSW EPA website and a copy of the IWRP can be downloaded from: http://www.epa.nsw.gov.au/waste/iwrp.htm
VIC - State Environment Protection Policy on used packgaging materials information available from the VIC EPA website http://www.epa.vic.gov.au/or contact the EPA Information Centre to order copies of the SEPP and relevant guidelines (03) 9695 2722
