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With overseas countries rejecting more and more of Australia’s recycling, the federal and state governments are finally working towards a solution – 10 years after industry experts warned of the impending problem. By Drew Rooke.

Ending Australia’s recycling chaos

Early one morning in July 2017, thick toxic smoke and ash started billowing from a waste recycling centre at Coolaroo, a suburb in Melbourne’s north. Massive stockpiles of plastic and paper were ablaze.

Firefighters battled to control the fire, while residents of 115 homes nearby were evacuated, with many suffering nausea and breathing difficulties due to the smoke.

It wasn’t the first time something like this had happened. There had been a number of other recent fires at the same waste centre, including one earlier that year. But this fire was unprecedented in its size; it burned for nearly two weeks.

The owner of the Coolaroo centre, SKM, and its director were charged earlier this year by the Environment Protection Authority with environmental offences related to the fire. More than 200 locals also launched a class action against SKM and, on August 1, the Victorian Supreme Court approved a $1.2 million settlement.

The very next day, SKM itself went up in flames as the company was declared insolvent, and it emerged that SKM owed more than $50 million to hundreds of creditors. SKM’s founder Giuseppe “Joe” Italiano has blamed the company’s collapse on a “witch hunt” by regulators.

“I’ve put millions of dollars into recycling, which no one else has,” he told the Sunday Herald Sun. “I’ve run out of money to pay for bad management by Daniel Andrews and the rest of them.”

SKM has not been accepting any new waste since July – plunging Victoria’s recycling system into chaos. Across Melbourne, six massive warehouses rented by SKM are packed with bales of milk bottles, PET plastic containers, paper and cardboard stacked up to five metres high. It’s likely most of this will be sent to landfill, with landowners forced to foot the bill.

Prior to its insolvency, SKM was one of only three major recyclers in the state. It had contracts with 33 local councils in Victoria and handled approximately 300,000 tonnes of recyclable material every year – about half of the state’s total amount. In a submission to the Victorian parliamentary inquiry into waste management, which is expected to hand down a final report in November, the company warned that if it went under, an extra 400,000 tonnes of recyclable material per year could be sent to landfill.

In an attempt to mitigate this risk, the Victorian government has thrown $11.3 million at councils to help them cope with the fallout from SKM’s closure. But not everyone is satisfied with this. Speaking to the ABC, City of Greater Geelong mayor Bruce Harwood labelled the funding announcement “barely tokenistic” and called on the state government to offer more practical assistance to local councils in dealing with the mess.

While Victoria finds itself in crisis, problems with waste management and recycling are widespread across Australia. As Pete Shmigel, chief executive of the Australian Council of Recycling, says: “Is there pressure on the systems in other states? Absolutely.”

Key to this pressure is the fact that other countries have closed their borders to accepting foreign waste – most disastrously China.

Over the past four years, China, which for the previous quarter-century recycled nearly half of the world’s rubbish, implemented a series of strategies to halt the huge amount of contaminated recyclable materials that were overwhelming waste facilities and creating an environmental catastrophe. This culminated in January 2018, when Beijing enacted the National Sword policy, which restricted the importation of 24 types of solid waste, including various plastics and unsorted mixed papers.

At the time, Australia exported about 1.3 million tonnes of its recyclable material to China. According to a government-commissioned report by environmental consulting group Blue Environment, 99 per cent of this was affected by the new restrictions.

Then, in April this year, India – the fourth-largest importer of Australia’s plastic waste – took similar action to China, imposing a blanket ban on recyclable plastic. Malaysia and Indonesia are expected to follow suit in coming years.

This has resulted in huge amounts of recyclable material that would have previously been exported being hazardously stockpiled in warehouses or dumped in landfill across Australia. “Because Australia sends so much of its waste offshore, we literally haven’t developed factories that can process this waste,” Linda Scott, president of Local Government New South Wales and deputy lord mayor of Sydney, tells The Saturday Paper.

The current crisis could have been mitigated – and possibly avoided entirely – if governments in Australia had listened to the warnings from industry about the volatility of global markets, according to Gayle Sloan, chief executive of the Waste Management and Resource Recovery Association of Australia. Sloan says governments should have advanced, rather than neglected, the 2009 National Waste Policy, which was intended to guide national policy direction up to 2020 with 16 priority strategies for domestic waste, including promoting sustainable procurement practices and better management of packaging.

At a 2018 senate inquiry into waste and recycling in Australia, Sloan said that even if governments had pursued just a handful of the priority strategies, “Australia may well have progressed in creating secondary markets and a circular economy” and “would not have the continued reliance we have, to an extent, on global trading markets, such as China”.

Compare this with the European Union, which in 2015 adopted an ambitious action plan for strengthening its own recycling market and transitioning towards a fully circular economy. Four years later, the plan is completed, with every one of the 54 strategies either being delivered or currently implemented.

Sloan places much of the blame for policy inaction in Australia specifically at the feet of those in Canberra. She tells The Saturday Paper that “government at a federal level absolutely took their eye off the ball” and “did not provide national leadership and co-ordination”.

At the recent Council of Australian Governments (COAG) meeting, though, there was finally some progress in improving national waste management policy. State and territory leaders agreed “to establish a timetable to ban the export of waste plastic, paper, glass and tyres” and their respective environment ministers were asked to develop an exact timetable and response strategy to reduce waste and “maximise the capability of our waste management and recycling sector to collect, recycle, reuse, convert and recover waste”.

This was quickly followed by a federal government announcement last Monday – $20 million in funding to help grow Australia’s domestic recycling industry. “We are committed to protecting our nation’s environment while also building our capacity to turn recycling into products that people want and need,” said Prime Minister Scott Morrison.

However, much more investment will probably be needed to build and support the domestic recycling industry if the promise to ban recycling exports – which last year totalled 4.5 million tonnes and cost Australia nearly $3 billion – is to be fulfilled.

Linda Scott is calling on state governments “to invest 100 per cent of the waste levy into a statewide approach to waste and recycling, via councils”. In 2016-17, for example, the NSW government collected $659 million in waste levies, yet only 18 per cent of this was returned to local government.

Nonetheless, the commitments made at the COAG meeting and the federal government’s funding announcement are “positive steps”, says Gayle Sloan. “Hopefully we’ll get some real action.”

Pete Shmigel agrees with this sentiment. He says the COAG commitments and the new federal funding present a significant opportunity for Australia to “develop sustainable waste management strategies” and “start to become sovereign when it comes to our recycling as opposed to reliant on global patterns”. Practical measures he wants to see implemented include an overhaul of the current kerbside recycling system so there is less contamination, and ambitious government procurement targets for recycled materials to help boost domestic demand.

“Governments are the biggest purchasers of goods and services in this country,” he says. “So, if they, for example, were to demand or specify or determine that the country’s biggest public assets should be built with recycled content instead of virgin materials, that would make a massive amount of difference.”

According to Sam Davies, co-founder of the small-scale plastic recycling factory Defy Design, based in Sydney, individuals can also help by starting to think more deeply about waste – beyond the changes happening at a government level.

“At the moment we seem to be so disconnected from the consequences of our consumption habits,” he says. “We put something in the bin and never see or think about it again.

“I think we all need to try and make an effort to reconnect with our own impact on the planet.”

This article was first published in the print edition of The Saturday Paper on Aug 17, 2019 as "Wasting in the wings". Subscribe here.

Drew Rooke
is a freelance journalist and the author of One Last Spin: the power and peril of the pokies.