LATTE LEVY COULD GENERATE MILLIONS FOR GOOD CAUSES

5 January 2018

The introduction of a latte levy has the potential to build on the huge success of the plastic bag levy and raise major sums for good causes, according to the Charities Aid Foundation (CAF).

MPs on the Environmental Audit Committee have argued that a 25p levy on the price of a takeaway coffee could lead to a 30% reduction in the use of disposable cups and generate £438 million in revenue which they say could be used to fund better recycling facilities.  But the impact of the scheme could be increased by applying some of the proceeds to support charities with experience of recycling, environmental protection and consumer advice, harnessing their expertise in recycling and their work changing consumer behaviour.

CAF, which works with thousands of companies, is calling on the Government to look at how charges and levies could support charities working for the public good, building on the huge success of the 5p-a-bag plastic bag levy.

The plastic bag levy brought about behaviour change with an 85% drop in the number of single-use plastic bags used by shoppers and generated millions of pounds for good causes proving that the introduction of levies can be highly effective and useful.  The plastic bag levy dramatically cut the number of bags being used and raised £29 million for good causes in the first six months of the levy.

In 2016 CAF found the plastic bag levy had a huge impact as retailers launched local initiatives and partnerships.  By August 2016 nearly £10 million had been distributed via CAF to charities by retailers including Aldi, Marks and Spencer, Co-Op and Sainsbury's after the levy was introduced in October 2015.

The latte levy, combined with a 5p levy on all single-use plastic items as suggested by CAF in 2017, alongside the plastic bag levy could generate even more money for charitable initiatives and good causes.  CAF estimates that a proposed levy on single-use plastic items could generate at least £1.75 million a day for good causes if levels of use did not change.

Following the Chancellor’s announcement in the Budget that he would explore the possibility of a levy on single-use plastic items CAF calculated how much could be raised if a 5p levy, similar to that placed on single-use plastic bags, was introduced.

Based on figures by sustainability charity WRAP, that more than 35 million plastic bottles are used every day in the UK, a 5p levy on all plastic bottles alone could see £1,750,000 a day and subsequently £638,750,000 a year generated if levels of usage remained the same.  The full amount, including other single-use plastic items, would be even greater.  According to WRAP, 16 million bottles a day are not recycled.

Even if the number of plastic bottles used every day fell by 85%, similar to the reduction in use of plastic bags, this could still generate more than quarter of a million pounds a day (£262,000) for good causes.

Sir John Low, Chief Executive of the Charities Aid Foundation, said:

"The reaction to the idea of 25p added to the price of your takeaway coffee shows that people support levies and consumer charges that are used in a positive way.  Ministers should look not only to develop better recycling facilities but also harness the excellent charities working for the public good, particularly in areas like the environment, recycling and consumer advice to achieve the greatest impact from any levy.

"Combined with a general levy on all single-use plastic items, suggested by CAF last year, these levies can bring about positive behaviour change and generate millions of pounds to change our communities for the better."

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