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The challenges brought on by the Covid-19 pandemic have caused seismic shifts in the way consumers interact with FMCG sectors, and many of these changes will become part of a ‘new reality’ into the future. For government and industry, however, a blueprint for recovery is not only desirable, but essential to chart a road to recovery. In response to the Australian government’s calls for industry strategies to lead the recovery, the Australian Beverages Council and KPMG brought together industry expertise to develop a number of key policy improvements across nine key areas to help businesses and the wider economy get back on their feet quickly. For the drinks industry, this is especially important as it looks to the important summer months to regain some of the ground lost at the start of 2020. ‘A refreshing recovery: A post- coronavirus recovery blueprint for the Australian drinks industry’ was launched recently to provide a pro-growth, pro- jobs set of policy options to position the industry and broader economy on a strong footing. Launched with the support of the Assistant Minister for Waste Reduction and Environmental Management, Trevor Evans, the blueprint forms part of the recovery and ‘new reality’ stages of the industry’s response to the pandemic. The recovery blueprint outlines a number of inhibitors to growth and jobs within the drinks industry (and more broadly across the economy), but most importantly puts forward four pragmatic policy recommendations for all governments to consider in the economic and social rebuilding effort, including harmonisation of container deposit schemes (CDSs), reforming the tax system, a simplified and mutually beneficial industry relations system, and awell-informed energy policy. What became profoundly clear in developing the report is that sustainability has become the vehicle for both economic recovery and a more sustainable future. If managed strategically, sustainability not only has the potential to support a recovery and return to growth in the drinks industry, but it would also meet a number of objectives laid out by the Commonwealth and the states/territories. Particularly, the drinks industry continues to seek harmonisation across CDSs and the potential expansion of the schemes to include waste from other sectors to make this product stewardship scheme even more viable. Extensive research and numerous global case studies have shown that a CDS is not only beneficial to the environment but also provides important social and financial benefits to communities. As the drinks manufacturing and supply industry continues to adapt to the challenges caused by the pandemic, the industry will continue to be focused on more efficient use of resources through more sustainable practices and by minimising its environmental footprint. At present, when virgin materials end up in landfill, an opportunity to reuse this valuable resource is missed. By expanding CDSs and harmonising them across all states and territories, the schemes’ redemption rates and overall effectiveness would be improved significantly while progress is made towards a truly circular economy. Among other considerations, the recovery blueprint notes the multiple benefits of using higher amounts of recycled material in container packaging, which, in turn, reduces energy consumption, relative cost and carbon emissions. One of the greatest obstacles to achieving higher recycled content levels in Australia (and in other markets), however, is the lack of domestic waste processing infrastructure and the price disparity between virgin and recycled material, which has worsened during the crisis. While Australia has a surplus of recyclable plastic and a veritable network of CDSs, all of which collect vast amounts of beverage containers, limited capability to reprocess and remanufacture locally remains a major barrier to creating a circular economy. At present, suppliers of container material are in the perverse situation of being forced to export polyethylene terephthalate (PET) only to import rPET resin to manufacture new containers, which is at odds with sustainability goals and the intent of the COAG waste export ban from March 2020. To address the need for more locally sourced recycled material and provide economic opportunities for communities across Australia in the form of skilled and semi-skilled jobs, the drinks industry is seeking greater investment in recycling, reprocessing and remanufacturing infrastructure. Already, a number of operators in the private sector have commenced discussions to boost reprocessing infrastructure, but this must be against the backdrop of stable energy costs. For some time, high and volatile energy costs have been a long-standing issue in Australia, particularly affecting the manufacturing sector. In order to support a vibrant manufacturing sector and efforts to encourage resource recovery and processing facilities, energy costs must come down. In recent years, high energy costs have not only stymied investment in Australian manufacturing but have precipitated job losses and short-termism across the sector, which has made the sector vulnerable to external shocks, such as Covid-19. Over the coming months, the drinks industry will continue to advance the case for a more circular economy, underpinned by a commitment to job creation and investment by industry in sustainable sectors and practices, to support an ideas-led recovery that will not only benefit the drinks industry, but the wider economy and society as a whole. The drinks industry’s recovery blueprint signals the industry is embracing the permanent market changes caused by the pandemic and that the drinks industry is again stepping up to provide solutions to complex problems. THE BEVERAGE GUIDE About Geoff Parker Since 2009, when Geoff was appointed CEO of the Australian Beverages Council, he has successfully managed two mergers, significantly raised the Council’s profile with key stakeholders and firmly positioned the organisation as the peerless, respected voice of the $7 billion-plus non-alcoholic beverage industry in Australia. Geoff has also served on the Board of the International Council of Bottled Water Associations (ICBWA) since 2009, and in 2017 was elected as its Vice-President. About Australian Beverages Council The Australian Beverages Council is the proud voice of Australia’s non-alcoholic drinks industry, and the only dedicated sector representation of its kind in Australia. The Council represents about 90 per cent of the industry’s production volume and its member companies are some of Australia’s largest drinks manufacturers. The Council also represents many small and medium- sized companies across the country. NOV, 2020 RETAIL WORLD 61