At the Australian Council of Recycling (ACOR), we know first-hand that the recycling industry is actively investing and innovating to support progress toward Australia’s 80% resource recovery target.

One key challenge lies in the lack of alignment between environmental policies and circular economy principles, hindering the sector’s ability to maximise recycling.

In the last few years alone, our industry has made rapid and unprecedented investment in the processing and remanufacturing capabilities for recovered resources. This has been spurred by demand and interest in recycled products and materials. From home construction materials to chocolate wrappers, Australians are increasingly seeking out more circular solutions in their everyday lives. Remanufactured items made onshore are becoming regular features in our built environment. From outdoor furniture, fence posts, builders film, paint trays, bedding sands, gravel, asphalt additives, to mulches and compost – we are (re)making more than ever before!

However, regulation blind spots and a lack of transparency in decision-making continue to cause headaches for construction, demolition and the broader resource recovery industry. The recycling sector has long faced a fragmented, variable and duplicative regulatory environment across Australia’s States and Territories, undermining investor confidence in recycling infrastructure and impeding innovation. Whilst laws and regulations for waste and recycling are implemented at a State level, there is an increasing need for them to be harmonised at a national level to prioritise circular economy outcomes.

Balancing risk with reward

When it comes to resource recovery, an abundance of caution often leads environmental regulators across Australia’s States and Territories to apply a strong focus on risk, whilst not properly recognising the broad benefits.  This effectively limits the potential of resource recovery outcomes.

This ‘precautionary principle’ follows the theory that it is better to avoid any new action that carries a hypothetical risk for human health or the environment, regardless of whether the hypothesis has been subjected to rigorous formal testing.

It’s easy to understand why, with lessons learned from the cautionary tale of asbestos. The health risks of asbestos are widely known today, but up until the mid-1980s Australia had one of the highest rates of asbestos use per person in the world. And of course, the presence of this material in today’s built environment is now a burden across society. This experience has undoubtedly spurred the precautionary principle in regulation.

But by its very nature, this principle is inherently subjective. Taken to its extreme in the recycling context, the application of this principle means that no recovered materials could be reused and recycled in case unknown pollution risks to the environment and human health manifest in the future. Whilst it is of utmost importance to avoid harm to human health and the environment, the most appropriate way to balance circular economy outcomes with environmental protection priorities is to apply transparent, robust and reliable risk assessment and risk management practices. And to work in partnership with industry to map the way forward.

A supportive and stable regulatory environment

The recycling industry needs to be consulted in a timely and collaborative manner in order to effectively adapt and contribute to the circular economy goals of state and territory governments.

Late last year, the NSW environmental regulator flagged an intention to revoke the Recovered Fines Orders and Exemptions. In simple terms, ‘Recovered Fines’ are soil or sand substitutes of less than 9.5 mm, derived from the processing of mixed construction and demolition waste and skip bin materials.

This planned revocation was abruptly announced by the NSW EPA with an original consultation period of only one month; eventually extended to two months.

Industry analysis quickly revealed the impact of this proposed decision, including the diversion of up to 1.3 million tonnes of material to landfills annually; a reduction of the construction and demolition recovery rate from 76% to 66%; and a reduction of the overall state-wide recovery rate from 64% to 58%. If the environmental impacts weren’t alarming enough, the modelling also predicted a net economic loss of over a billion dollars over the next decade across industry. Homeowners would have been affected as well, with a predicted increase in the construction costs of an average residential building of over $2000.

The condensed timeframe did not allow for an adequate consultation process, nor did the investigation leading up to this decision adequately involve industry experts. Additionally, a reasonable transition plan for the resource recovery sector was not sufficiently outlined.

Industry pushed back strongly across both the recycling and construction sectors. The issue even hit talkback radio waves. And in an unprecedented move, reflecting broad concern about the perverse outcomes, the regulator decided not to move ahead with the planned revocation.

Whilst this is ultimately a good news story, the industry disruption and investment uncertainty caused by this process was unnecessary, time-consuming and counterproductive.

This is not a situation unique to NSW. Our industry has found critical shortcomings in transparent, collaborative and timely engagement by regulators across all Australian jurisdictions – often coupled with a lack of balance between potential harms and economic and social benefits. There is a keen need for better industry engagement and consultation, and better alignment between circular economy and environmental protection priorities, to support stronger confidence in our operating landscape.

A harmonised regulatory framework

So what active steps can be taken to ensure industry consultation and further instil confidence in our operating landscape? One of ACOR’s goals is the establishment of an Australian Resource Recovery Code Board, to deliver a nationally harmonised regulatory framework for resource recovery and recycling. Based on the model of the Australian Building Codes Board (ABCB), this nationally harmonised framework would oversee ‘end of waste’ codes and product stewardship schemes such as container deposit, with the priority of advancing circular economy outcomes.

As with the ABCB, it is monumentally important for industry to have a seat at the table when it comes to defining regulatory frameworks for resource recovery. Our members bring considerable real-world resource recovery and recycling expertise based on their operations in every jurisdiction in Australia and internationally. A proposed Resource Recovery Board should agree on the beneficial uses of all existing emerging recoverable resources and develop model regulation for adoption by all jurisdictions. This would not only deliver a nationally harmonised framework (or as close to one as we can get!), but it would also help resource recovery regulation to achieve the appropriate balance between circular economy priorities and environmental protection, through robustness, objectivity, consistency, and transparency. A nationally consistent and stable regulatory framework will drive investment, innovation and demand for recycled materials.

Transparency, consultations and better outcomes

Encouragingly, regulators are increasingly listening to industry and involving them earlier in the decision making process. Just last month, the NSW EPA confirmed they will not move ahead with proposed changes to the ‘Recovered Fines (skip bin fines) Orders and Exemptions’, which threatened to disrupt the C&D recycling sector. This decision reflects the consultations and concerns of the recycling sector, small businesses and the construction industry over the last six months. It also highlights the importance of a constructive relationship between industry and regulators. We hope this trend continues with the independent review of the NSW Resource Recovery Framework and also the upcoming review of the Queensland Waste Management and Resource Recovery Strategy.

We must never forget the lessons of the asbestos legacy.  However, current regulatory frameworks are often so concerned with not getting it wrong again, that they are failing to see where they could be getting it right. The establishment of an Australian Resource Recovery Code Board could deliver a nationally harmonised regulatory framework for resource recovery and recycling and help state and territory regulators to embark on a step change in delivering a circular economy.