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Issues at Glance – Toronto’s 5¢ Plastic Bag Fee

February 23, 2010

The gestation period for Toronto’s 5¢ bag fee has finally come to term.  Nine months ago, on June 1st, 2009, the city-wide fee came into effect.  Even amongst the initiative’s supporters and naysayers, there is still a bit of uncertainty and confusion.  City Council was criticized by some merchant groups for not clearly communicating the plan to retailers and consumers.  Coerced Musings takes a look back at what has changed and what has been accomplished.

In his 2006 election campaign, Mayor David Miller had publicly stated his desire to divert 70% of Toronto’s waste away from landfills by 2010.  Ecological concerns aside, over the last several years, the mega-city has struggled to find takers for its refuse.  The growing objections of smaller communities to the North compelled Toronto to ship its waste South of the border to Michigan where the City’s garbage trucks were once again faced with local outrage.

Among the City’s other waste-reducing initiatives (including the highly criticized green bin program), on March 31, 2009, Council approved a bill which would force retailers to charge customers 5¢/plastic bag by a vote if 30-13.  The fee of 5¢ was negotiated by City Councillors and by the largest grocery companies operating within the 416.

The 5¢ Bag Fee

  • Goal: Reduce volume of plastic bags, encourage the use of reusable bins/bags.
  • Retailers charge 5¢ per  plastic bag requested and must provide a free alternative.
  • Retailers must display prominent signs explaining the fee.
  • Retailers are entitled to keep the revenue from the bags.

City Council itself was not free of opposition.  Karen Stintz, city Councillor for Ward 16, argued instead for a voluntary fee based on the fact that the city already accepts plastic shopping bags into its recycling program.  Arguments like this are lost on me.  I wonder how Councillor Stintz believes that a voluntary fee would be effective for two reasons.  What percentage of consumers, by their own volition, would simply start paying for plastic shopping bags after a lifetime of receiving them free of charge?  Secondly, just because plastic shopping bags are recyclable is by no means a reason to ignore the issue when there are extremely simply methods for discouraging their use in the first place.  It seems that any reduction in material heading for city recycling stations would save taxpayers’ dollars and is therefor a good thing.

Groundbreaking?

Hardly.  On May 9, 2007, the Ontario Government launched a campaign against the use of plastic shopping bags along with a report stating that Ontarians use 80 plastic bags per second in the province.  That means that every year Ontarians are taking 2,522,880,000 bags home with them, all of which are destined to be either incinerated or to languish within a landfill for the next 1000 years.  The campaign was directed towards capturing the hearts and minds of consumers, urging us to stop and think about whether or not we really need to double bag a bag already containing three bags of milk (yes, thats how we drink it here, get over it).

In many ways, some grocery stores had caught this train long before.  For years, No Frills has been charging customers for their yellow plastic bags.  Something apparent to any observer of a No Frills parking lot as a steady stream of customers can be seen exiting the store, clad with groceries protruding from used boxes once packed with bananas or diapers.

Toronto is by no means the only city in Canada with a policy of charging a fee for plastic bags.  Nor is Canada itself a trend setter.  In 2002, retailers in Ireland began charging the equivalent of 36¢ for plastic bags (although the country imports more plastic bags now than it did in 2002).

The Early Results

Metro has recently reported that it has witnessed a reduction in the use of plastic shopping bags at its stores by over 70%.  A theme that is echoed by almost every grocery retail chain in the province.  By this measure, it seems hard to argue against the success of the program.  The Communications Director for the World Wildlife Fund, Josh Laughren, seems to agree.  Laughren cuts through any criticism by asserting that “it does reduce bags” and that seems good enough.

Although every commercial enterprise is legally required to charge 5¢ per plastic bag, (aside from crown corporations) it seems as though grocery stores are only retailers to have fully adopted this policy.  This may simply come down to this issue of having to offer a free alternative.  Many small stores seem to be lagging behind the requirements by not maintaining a supply of paper bags and boxes, while on the other end of the spectrum, many LCBOs seemed to have abandoned stocking plastic bags at all.

So What About All These Nickels?

It appears that the average consumer truly believes that this fee is a tax.  If you were among those who was under the impression that the money generated from the 5¢ bag fee went directly into municipal recycling services you would be mistaken.  Officials with the Canadian plastics industry estimate that since June 2009, retailers have taken in an additional $15 million in revenue generated from the sale of plastic bags (not including the revenue generated from the sale of reusable bins).  Metro’s reports that bag use has dropped from 5 million/week to 1.2 million/week equates to an additional $3.12 million a year.  Grocery retailers seem torn over what to do with the additional funds.  Although the City doesn’t force the issue, Council “recommends and supports” that the money goes towards environmental causes.

Since January 2009, Loblaws has pledged $3 million over the next 3 years to the WWF.  Sobeys donated $370 000 to 22 various charitable organizations and Metro has founded Green Apple Grants, which has given $2 million to primary and secondary schools in Ontario and Quebec.  It should be understood that these pledges all fall far short of the revenues generated by the sale of plastic bags in all three companies.

This fact is not lost on the public relations practitioners for the grocery chains.  Tracey Chisholm, the Communications Director for Sobeys would like to see more of the money going towards environmental causes but worries that in doing so, consumers would be missing the very point of the The 5¢ Bag Fee.  The fee is not supposed to be about funding environmental cleanup, otherwise it would have been established as a tax that would go towards financially supporting municipal programs already in place (believe me, they need the money).  The fee is all part of the “hearts and minds” strategy.  The idea is simply to create a consciousness within consumers’ minds over the impact of their use of plastic shopping bags.  This awareness then spreads to other unsustainable areas of consumerism.  As Chisholm states, if the proceeds from the sale of bags went directly to environmental causes, the raison d’etre of the program would be compromised because people would begin to feel good about buying plastic shopping bags.

The Ruling

The The 5¢ Bag Fee program was never meant to be a stand-alone.  It is a very small part of the larger initiative towards reducing Toronto’s environmental footprint.  It was designed to be a simple and digestable as possible.  It has clearly reduced the use of bags and has accomplished the program’s goal.  No matter what the issue, there always seems to be an externality or two.  In this case, City Council managed to implement a simple program that quickly facilitated the generation of large revenue streams within the private sector during an economic downturn.  How many grocery clerks’ jobs were saved is open to speculation.  In any case, Coerced Musings gives a thumbs up a for the 5¢ Bag Fee!

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