Thursday, April 30, 2015

Magazines Canada wants changes to Blue Box pricing and accounting

In a letter to the Canadian Stewardship Services Alliance (the national authority governing recycling), Magazines Canada describes as "egregious" the pricing and accounting practices currently being used in administering Blue Box programs in Ontario and elsewhere. 

A methodology review that the Alliance is undertaking must address fundamental failings in the way Canadian magazines and other printed papers are treated, the letter said. Among those issues are:
  • US publishers are still not paying their way, including those with Ontario residency, requiring magazines to carry the funding load (approx. 40%-50% of Ontario’s magazine tonnage can be attributed to foreign publishers). Stewards continue to pay for unstewarded materials
  • Magazines are paying more than they otherwise should because single stream collection causes a comingling of printed paper and packaging resulting in a devaluation of paper fibres due to significant soiling and the broad mix of paper materials within post-processed bales.
  • The system is not fair and equitable; for instance, newspapers are not paying significant cash into the system and have that arrangement enshrined in legislation, despite having very similar handling. 
  • Magazines are being required to help subsidize costs for new and light-weighted materials when magazine papers remain much simple to process
Magazines and other printed papers have a higher recovery rate, sitting above the average at 88%, MC says. It also points out that they are 100% recyclable and represent 50% of  total tonnage in Ontario and yet magazine fee increases have been 8,300% since 2003.Magazine fees are approximately double what they should be. Compare magazine fee increases with other, harder-to-recycle materials:
The letter asked that the "cost transfer barrier" be removed, originally meant to redistribute costs from high-performing materials to low. This is now redundant given that materials are co-mingled.

It also asks for changes to "free rider" costs,...
"To force any Steward to absorb any cost that is not of a Steward’s making is a failing of the legislative and regulatory environment within which the plan must operate."
...And for a review of cost measurement and cost allocation.
  • Easy to recycle printed paper materials are saddled with unfair and relentlessly increasing system costs driven primarily by the introduction of new, difficult to recycle materials that often require more complex and expensive sortation solutions to properly manage those materials
  • We believe that the methods used to measure and allocate overheads and system costs should be reviewed to ensure that each and every material is indeed treated fairly


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