2009 National Waste Policy Update: Levers to drive economic and job growth

19 September 2018

In the past week, the Waste Management Association of Australia (WMAA) congratulated the Federal Department of Environment and Energy for developing the Updating the 2009 National Waste Policy Discussion Paper within a short time frame, but also pointed out that the paper fails to discuss several leadership opportunities for the Commonwealth that will build economic strength and generate employment in the waste and resource recovery industry in Australia as we forge forward towards a circular economy.

A transition to a circular economy will be a seismic shift in our economy, our communities, and our environment. For instance, according to a MRA Consulting Group report, domestic remanufacturing of just 50% of material that was formerly sent to China would create approximately 500 new jobs. We know that we can create 9.2 direct full-time equivalent jobs and 1.87 indirect jobs for every 10,000 tonnes of waste that is recycled. In South Australia alone, a more circular economy is predicted to create an additional 25,700 jobs (21,000 via actioning material efficiency gains and 4,700 by actioning efficient and renewable energy gains).

Beyond job creation, World Economic Forum estimates suggest a circular economy could add A$26 billion to our economy by 2025. A shift to a circular economy would also add an additional A$9.3 billion to Australian business through a collaborative economy.

So let’s drill down on how we think the Commonwealth can support industry, boost jobs, and drive economic growth through the National Waste Policy, and reflect on learnings from the United Kingdom (UK) and the European Union (EU).

The waste management and resource recovery industry is an essential industry for our community and the economy. One might think that an industry that turns over $15.5 billion per annum, directly employs more than 50,000 Australians, and handles the volume of resource we do (see Table 1) would not have to keep reminding Government that we are in fact essential.

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Table 1: Value of waste and recycling activity across the states (2014-15) - Inside Waste Industry Report 2014-15

The Commonwealth’s Role

To the Government’s credit, the goals set in the discussion paper do not favour one State or Territory over the other, nor are they prescriptive. However, what would be useful would be an accompanying roadmap on how these goals can be achieved.

The first step forward would be for the Federal Government to actively collaborate with State jurisdictions. There are numerous gaps that can be filled if we achieve genuine collaboration between the State and Federal Governments and end what in recent years has looked more like ”buck passing”.

• Data

In Australia, we have a distinct issue with the lack of meaningful data that is at the disposal of government and industry, specifically, the areas of production, manufacturing, and distribution. We simply do not know how much waste is being produced in these areas and when produced, where it ends up. We cannot possibly make true assessments and plans without all the data from throughout these supply chains.

The current form of the Updating the 2009 National Waste Policy Discussion Paper seems to lean towards the management of municipal waste (MSW) despite almost 80% of waste generated in Australia coming from Commercial and Industrial (C&I) and Construction and Demolition (C&D) streams. However, without accurate information regarding the whereabouts and make-up of that waste, it becomes incredibly difficult for government at all levels to formulate meaningful policy.

The data in Table 1, from the Federal Government’s published waste generation and resource recovery report, provides a snapshot of the amount of resource our industry is managing. However,the current level of data does not accurately represent the true benefit those resources are to our remanufacturing industry, nor the impact China’s National Sword Policy will have on resource values, for example.

The UK and the EU’s Circular Economy transitions both began with a true understanding of data. WMAA advocates that the WRAP UK model is an excellent example of commitment to gathering and utilising data for positive change. WRAP UK works as an independent third party in the space between governments, businesses, and communities, to collate and produce workable and meaningful data and advice on action that needs to take place.

We need to be able to accurately and consistently accrue and assess data to be able to underpin the ‘waste management hierarchy’, agree on national diversion targets (increasing towards zero waste in 2050, perhaps), and work systemically towards a national transition to a circular economy. The Federal Government must commit to funding ongoing independent data capture that supports evidence-based policy development for our essential industry.

• National Whole-of-Government Approach

The EU recognised that waste could not be managed under one government portfolio (environment). Australia should take a page from the EU’s playbook and embrace a whole-of-government approach, utilising energy, climate, agriculture, consumer protection, regional development, and research departments. The policy framework that the EU setup was one of the largest in the EU’s history, with more than 54 clearly defined measures, all with responsibilities allocated.

Australia, like the EU and Britain, has many companies that operate nationally, as well as many multi-nationals. Many within our industry collaborate with these companies to work towards common goals; however it is challenging to gain real traction on state-based initiatives given the national and global reach of these companies. The Commonwealth must play a key role in bringing these companies to the national table with industry to share their data and discuss their concerns, objectives, and insights to drive collaboration on all fronts; to date there has been no process for this. The voluntary UK Plastics Pact launched by WRAP UK is a perfect example of how this can and must occur. 42 businesses, including major food, drink and non-food brands, manufacturers, and retailer’s right through to plastic reprocessors and packaging suppliers have made their commitment to the Pact. These Pact members are responsible for over 80% of the plastic packaging on products sold through UK supermarkets. This powerful collective has committed to hit a series of ambitious targets by 2025:

  • Eliminate problematic or unnecessary single-use plastic packaging through redesign, innovation or alternative (re-use) delivery models.
  • 100% of plastic packaging to be reusable, recyclable, or compostable.
  • 70% of plastic packaging effectively recycled or composted.
  • 30% average recycled content across all plastic packaging.

When one considers the plastic stream in Australia (see Table below), it is instantly apparent the power of having all stakeholders from throughout the supply chain come to the table. To date in Australia, we have not been able to consistently achieve this, as there is no body in existence that has either the authority or the trust of all of industry.

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• Levers

The Federal Government must take a stronger role in delivering the updated Waste Policy, by both using the levers that it has at its disposal and leading by example. The EU acknowledged their responsibilities by increasing use and trust in secondary materials and by ensuring that a standards and testing framework was introduced and adhered to. This was interlaced with strict safety standards, before incentivising organisations on moving across to recycled content in manufacturing. This had the economic knock-on effect of creating a domestic industry for recycled materials.

The EU also set about introducing A New Deal for EU Consumers which they launched in April of 2018. Effectively, this enforced circular economy product guarantees for consumers, which included independent testing of products for planned obsolescence. The final step in this process was the introduction of circular economy labelling with durability/recyability information so that consumers could make informed decisions when making purchases. This, again, ensured economic success by making consumers comfortable with the purchase of products that included recycled content.

The introduction of a polluter pays system that ensures manufacturers and waste generators handle their waste correctly and have clear financial obligations for not doing so, was made clear from the beginning of the process and was not a surprise to generators – mainly because they were included in the discussions from the beginning.

The EU’s directive on waste could also offer a balanced approach to proximity/movement of waste. Under the directive on waste, member states must take measures to encourage options that deliver the best overall environmental outcome and develop a network of waste disposal options that will enable waste to be disposed of, or recovered, in one of the nearest appropriate installations.

The EU Waste Regulation provides for a process of notification and consent where waste moved from one country to another is destined for disposal. Only the Federal Government has the ability to clarify the issues surrounding the NSW proximity principle and find a solution to proximity nationally, so that waste does not move unnecessarily and we have certainty of volumes to build necessary infrastructure and the jobs that come with this.

The Federal Government also has in its armoury, a range of tools that it can use to encourage best practice. For instance, tax and R&D incentives should be offered to organisations that are actively working towards the targets set in the Discussion Paper.

Federal levers, if pulled well, have the ability to create a level playing field that incentivises the use of recycled material, creates investment and jobs in the remanufacturing industry, and creates local solutions to local issues. The corollary to that is failure to do so will continue to create an unlevel, uncompetitive playing field for the industry that inhibits market development.

The update to the 2009 National Waste Policy is an opportunity that cannot be wasted. The Federal Government has the opportunity to develop the roadmap for real change for Australia, but we can only do this by working together with a shared vision. Otherwise, we will continue to do what we have always been doing, and it is simply not working.