OPINION: A health check on the road to circularity

Published on Thu 10 February 2022 2:43pm

As we look to 2022, there is every reason to be optimistic about Australia’s potential to take on the big task of creating a circular economy as part of the wider push towards sustainability. The community wants that to occur, and industry will rise to the challenge if provided with a clear and consistent framework. To join those two vectors of change we need policy leadership that is comprehensive, coordinated, harmonised, and strategic.

First published in Inside Waste, Issue 106, February/March 2022 edition

At the end of another difficult year, let’s first focus on the positives. It is welcome that waste and resource management has continued to feature prominently in the national conversation. It is clear that community support and expectation for improving our approach and outcomes remains high. There is no doubt the sector is champing at the bit, and there are numerous examples of Australian companies and industries looking to embrace innovation.

There is every reason for Australia to push harder down the path of greater sustainability by dramatically reducing waste and its environmental impacts, and by dramatically increasing resource recovery/re-use and the job benefits from new manufacturing.

But nothing is gained by self-deception. Australia has a long way to go. We are one of the highest per capita producers of waste, and our rates of recycling and reincorporation of recycled material are not flash, especially with problematic materials like plastic.

At present there are legitimate concerns with respect to the pace and quality of reform.

When we recognise that the waste export bans were effectively forced on Australia, it’s easier to understand how the reforms to date have tended to be reactive and partial. That doesn’t excuse policy and programs that should be better.

The principles on which progress should be based are obvious. We need to address a broken market through reform that is comprehensive, coordinated, harmonised, and strategic. To expand briefly on the importance of each:

 Comprehensive: it’s no good stopping waste exports if the recycling/reprocessing capacity isn’t increased to match through infrastructure investment and the demand for recycled material isn’t supported through strengthened producer responsibility and procurement.

Coordinated: all segments of the circular economy need to be addressed with an understanding of how the cycle is connected and interdependent. Manufacturers bemoan a lack of quality recyclate, while recyclers bemoan a lack of demand certainty.

Harmonised: as change occurs it should be pursued on the basis of adopting common best-practice measures across state and territory jurisdictions.

Strategic: careful thought needs to be given to the opportunities and pitfalls inherent in the redesign of the resource recovery market when considering the challenges presented by Australia’s huge geography and medium-sized consumption economy.

So far, the Morrison government has missed opportunities to lead harmonised progress on container deposit schemes and the phased elimination of harmful single-use plastic. The promised delivery last year of meaningful Commonwealth procurement rule changes was a 2020 Christmas fizzer.

The approach in terms of producer responsibility and product stewardship has been at the very light-touch end of the spectrum. It is disappointing that we are still waiting for the review of the ineffective National Environmental Protection Measures (NEPM) framework.

Packaging – and plastic packaging in particular – offers a useful prism for examining the gap between optimistic claims on the one hand, and actual progress on the other. The latest APCO Collective Impact Report, published in December 2021, shows that the consumption of plastic packaging is increasing, the recycling rate is falling (from 18% to 16%), and the incorporation of recycled material in new packaging has fallen back towards virtually nothing (from 4% to 3%).

The accompanying analysis commissioned by APCO from Accenture, ‘Cost and incentives for a more circular packaging system’, finally bells the cat by saying what government has been reluctant to acknowledge, namely that a number of the 2025 targets will not be met.

This is not a revelation to anyone who has been watching. Despite being unconvinced that the government’s minimal strengthening of the Minister’s Priority List would be effective, Labor did seek to help the government reconcile or align this mechanism with the badly off-track APCO targets by proposing that packaging be added to the MPL from the outset. The government refused – and here we are, a year later, with the APCO measures sliding further off course, and even the promised accreditation of the voluntary scheme yet to be achieved.

More broadly, there is a danger of Australia shifting from the present broken linear market to a new arrangement that bakes in some anti-competitive and regionally inequitable features. In any transition, larger companies are better placed to adapt to change, and infrastructure will gravitate to locations that capture the largest proximate market. Does this mean that scale and vertical integration in recycling might put small manufacturers at a new disadvantage, leading to less diversity, competition, and regional spread of jobs and economic activity? Does it result in an uneven distribution of infrastructure so that the smaller and further-flung states/territories continue to be waste exporters and to bear that cost?

As we look to 2022, there is every reason to be optimistic about Australia’s potential to take on the big task of creating a circular economy as part of the wider push towards sustainability. The community wants that to occur, and industry will rise to the challenge if provided with a clear and consistent framework. To join those two vectors of change we need policy leadership that is comprehensive, coordinated, harmonised, and strategic.

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