Extended Producer Responsibility (EPR) Presentation to Liberal Caucus Jordi Morgan, Vice President, Atlantic Nick Langley, Director of Provincial Affairs, Nova Scotia September 2, 2015

About CFIB Mandate: Big voice for small business Promote and protect Canada’s free-enterprise economy Result of tax protest over 44 years ago 109,000 members with over 5,200 in Nova Scotia Non-partisan; 100% member funded One member, one vote policy

Nova Scotia CFIB member profile Our diverse membership of 5,200 businesses is a good reflection of the Nova Scotian economy 3

The Issue – Extended Producer Responsibility (EPR) EPR is an approach to solid waste management that shifts the responsibility for recycling and disposal from consumers to the business owners who sell products and packaging that end up as consumer waste.  It means business owners are required to submit detailed plans to the provincial government and pay fees to an external body – all for disposal and recycling services already funded through municipal property taxes. EPR would require businesses to weigh, measure, record, and forecast their packaging and pay based upon that packaging waste material. This is called printed, paper and packaging (PPP) component of EPR. EPR exists in the following jurisdictions: Ontario, Manitoba, Quebec, BC, and Saskatchewan.

The Background In October 2009, an MOU was signed by the Canadian Council of Ministers of the Environment (CCME). The MOU was to have implementation of EPR by October 2015 and for Nova Scotia to reduce its solid waste to 300 kg/person. Consultations took place in summer 2014 where the Department of Environment received 260 submissions, 25 per cent were from one environmental organization. In October 2014, CFIB shared with Minister Delorey the negative impacts of EPR in British Columbia and Ontario. In March 2015, the Department of Environment released its What We Heard document and sought feedback on that document in the spring of 2015.

Are you aware that the Nova Scotia government is considering implementing a new recycling program? Source: CFIB Nova Scotia Recycling Survey, June-July 2015, n=435

Have you had an opportunity to participate in the NS government's consultations about the new recycling program? Source: CFIB Nova Scotia Recycling Survey, June-July 2015, n=435

What would EPR Look Like in Nova Scotia? New Bureaucracy: A stewardship council would be created that would mirror the RRFB that would oversee EPR. Increased Taxes: Small businesses would have to pay based upon forecasted weight of their packaging, this is not something business can control. Oppressive Regulation: The regulatory burden of recording the packaging would overwhelm many businesses. Ineffective Policy: EPR will not help Nova Scotia achieve its solid waste goals, but it will create havoc with small business sector.

Small Business Views on EPR Source: CFIB Nova Scotia Recycling Survey, June-July 2015, n=435

CFIB Survey Findings 70 per cent of small businesses are opposed to EPR. Small businesses feel they have no control on the amount of packaging and waste their business sells as it is manufactured out of province. Businesses believe EPR is a new tax on their business. 99 per cent of small businesses were not aware or participated in the EPR consultations. Small businesses are not able to recover the costs of EPR by passing it on to customers.

CFIB Members – Environment Matters 75 per cent of small businesses felt they could grow the economy and protect the environment. 77 per cent said the have expanded their recycling measures to reduce waste. 84 per cent of small businesses are motivated to make environmental changes because of personal views. Source: CFIB Nova Scotia Energy and Environment Survey, January - March 2007, n=574

Does Nova Scotia Need EPR? No, EPR does not reduce solid waste. 22 of the 26 items to be included in EPR are already recycled under RRFB guidelines. Halifax Regional Municipality (HRM), which is 45 per cent of the provincial population, is incorporating new changes to its waste diversion program on August 1 st. Nova Scotia is at 380kg/person for waste in The provincial waste target is for 300kg/person.

Waste Reduction - How far we have come Waste Generation per Capita Sources: * Conference Board of **Stats Canada ***Waste Resource Management International **** Resource and Recovery Fund Board Inc.,

How Nova Scotia Compares to the World

Has EPR worked in other Provinces? In 2013, Ontario’s Ministry of the Environment stated it was only diverting 25% of waste away from landfills, despite a goal of 60% diversion established in In 2010, the Ontario Auditor General noted: “About 12.5 million tonnes of non-hazardous waste is generated in Ontario each year. Based on the Auditor General’s audit, about one quarter of this waste is diverted through reducing, reusing, or recycling. About two-thirds of the remaining waste goes to landfills in Ontario and almost all of the rest is shipped to U.S. landfill sites.” British Columbia has been another jurisdiction that has been held up as an example, but it is not accountable as it is not subject to Freedom of Information, the Auditor General, and no transparency for its fees.

Inconsistent Government Policies CFIB has been an ardent supporter of Premier McNeil’s vision of “Nova Scotia becoming the best regulatory environment in Canada.” CFIB works closely with the Office of Regulatory Affairs and Service Effectiveness on red tape reduction and internal trade issues. EPR is contrary to the government’s vision of regulatory excellence and effectiveness. EPR has been a “red tape nightmare” for small businesses in other provinces and CFIB has shared this information with the Department of Environment and the Office of Regulatory Affairs and Service Effectiveness.

Recommendations The Nova Scotia government must stop this EPR plan before it derails Nova Scotia businesses. There are two options: OPTION 1: Stop the EPR program before it advances forward. Look at ways Nova Scotia can implement meaningful waste diversion programs that will work and not be a red tape nightmare or tax grab upon small business. OPTION 2: Create a “de minimis” (a safe level of small business revenue) of $5 million to ensure small businesses are not impacted by the EPR plan of the Department of Environment.

What Small Businesses say about EPR “If we are burdened with more costs (taxes) we will simply quit and close down permanently.” - Retail, Kennetcook “Enough with the taxes and bureaucracy and red tape. Why does the government not get on with the recommendation of the Ivany report around growing our economy?” – Retail, Enfield “We are able to comply with such costs by eliminating 15% of our workforce, which we will..” – Hospitality, Baddeck “I sell goods manufactured by other, often offshore suppliers. I have no control over their packaging.” – Retail, Bedford “As the largest supplier in Nova Scotia of packaging materials, I am alarmed that we have not been consulted at all with regards to this new program.” – Wholesale Supplier, Dartmouth

Thank you Jordi Morgan Vice President, Atlantic Canadian Federation of Independent Business Nick Langley Director of Provincial Affairs, Nova Scotia Canadian Federation of Independent Business