Government shelves plan for mandatory packaging standards

The federal government has shelved a promise to implement national packaging standards aimed at reducing plastic waste, citing concerns over cost of living pressures. In an email to stakeholders, the Department of Climate Change, Energy, the Environment and Water said the mandatory standards would not proceed in this term of government.

Instead, it will work with states and territories on "opportunities to improve" packaging standards. "The Minister is looking at the pursuit of reforms in a way that balances environmental outcomes with the broader needs of the economy, with the Government looking closely at its policies to ensure it does not exacerbate cost of living pressures," the email said.

"The Minister has communicated that a new Commonwealth scheme for packaging will not be introduced in this term of government and is now focused on working with state and territory governments on opportunities to improve Australia's packaging regulations and policies in the nearer term."

According to data from 2023-24, only 18 per cent of Australia's soft and rigid plastics are recycled or reused. Federal Environment Minister Murray Watt said the Albanese government remains committed to "delivering stronger environmental outcomes".

"Our immediate focus is to work with state and territory governments to reduce waste by harmonising packaging and recycling policy in Australia," he said. "By working together across jurisdictions, we can reduce waste while also reducing inconsistencies for businesses, and minimise cost impacts on consumers."

Recycling industry 'devastated' by broken promise

Many in the recycling and sustainability industries say they were blindsided by the decision, which followed years of consultations and sustained pressure by the states and territories. Managing director of sustainability and waste management consulting firm MRA Consulting, Mike Ritchie, said the national standards had been agreed to multiple times by different levels of governments.

"[We've] gone down different paths of intergovernmental agreements and looking at how to do it," he said. "It was a great surprise that Murray Watt then just said, 'too hard, we're not doing it in this term of government'."

Mr Ritchie said failing to have national standards could mean different packaging and labelling rules in all eight states and territories. CEO of the Australian Council of Recycling, Suzanne Toumbourou, said a lack of certainty around packaging reforms left Australian manufacturers at risk of closure.

"Australian plastic recycling facilities are operating at around half their available capacity on average," Ms Toumbourou said. "Without those obligations, Australian recyclers are left competing on a vastly uneven playing field with cheap imported plastic."

Last week, one of Australia's biggest recycling businesses, Recycling Plastics Australia, went into voluntary administration, leaving around 60 jobs up in the air. The company received $20 million in federal funding in 2024 to accelerate the recycling of soft plastics, under the Recycling Modernisation Fund.

"It's devastating to see the government break its promise at precisely the point when investment, jobs and Australia's plastic recycling capability are most exposed."

Cost of living argument questioned

Mr Ritchie said the federal government has not conducted a regulatory impact statement on a proposed Commonwealth packaging scheme. A regulatory impact statement looks at the economic, social and environmental costs of proposed government regulation.

"[The government] can make no prognostications, no arguments, no pros and cons of packaging reform without having done it," he said. "So in a weekly shop of say 60 packaging items — your beetroot, your chips, your [chocolate] bars, your drink bottles — that weekly shop might go up by 20 cents."

Independent MP Kate Chaney said the government could act on minimum standards without having to legislate. Senator Hodgins-May said the government has failed to provide evidence that cost is a barrier to implementing mandatory standards.

"We're also hearing that there would be significant cost savings to be made through council rates because there would significantly less waste to be collected," Senator Hodgins-May said.

Public support for action on plastics pollution

Polling from the Australian Marine Conservation Society released in June this year found that nine in ten people surveyed want stronger action to curb single-use plastics, and more than six in ten (63 per cent) want mandatory packaging laws to replace voluntary targets.

"We [Australia] are doing appallingly comparatively to other OECD nations. We are one of the biggest polluters and one of biggest creators of waste."