Labor shelves national plastic packaging standards, citing cost of living concerns

The decision represents a significant reversal from the commitment made in June 2023 by then environment minister Tanya Plibersek, who joined state and territory ministers in agreeing to impose minimum targets for recycled content and limits on harmful chemicals in packaging. At the time, a press release stated it was ‘clear that voluntary targets and design guidelines aren't working’.

Federal Environment Minister Murray Watt told the ABC in a statement that the government remains committed to ‘delivering stronger environmental outcomes’ but said its immediate focus is harmonising packaging and recycling policy across jurisdictions to ‘reduce inconsistencies for businesses, and minimise cost impacts on consumers’.

The email to stakeholders explained that 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 closely examining policies to ensure they do not exacerbate cost of living pressures.

The recycling industry has reacted with dismay. Mike Ritchie, managing director of sustainability and waste management consulting firm MRA Consulting, said the national standards had been agreed to multiple times by different levels of government. ‘It was a great surprise that Murray Watt then just said, “too hard, we're not doing it in this term of government”,’ he said.

National targets set in 2018 included an average of 50 per cent recycled content in packaging, but the most recent data from 2023-24 shows only 28 per cent of rigid plastics and 9 per cent of soft plastics were reused, recycled or reclaimed. The minimum standards for the Commonwealth packaging scheme had not been finalised before the plan was scrapped.

Why This Matters

Australia's plastic recycling rates remain low, with only 18 per cent of soft and rigid plastics recycled overall, and the shelving of national standards removes a key mechanism to force improvement.
The decision pits environmental goals against cost-of-living pressures, a recurring tension in government policy that could delay meaningful waste reduction for years.
Without a unified national approach, businesses face a patchwork of state regulations, potentially increasing compliance costs and consumer prices in the long run.

Background

In June 2023, federal, state and territory environment ministers agreed to introduce mandatory packaging standards, including minimum recycled content targets and restrictions on harmful chemicals. The move followed years of voluntary targets that had failed to significantly boost recycling rates. The Commonwealth was to develop a national scheme, but the standards were never finalised. The Albanese government has now shelved the plan for this term, citing the need to avoid adding to cost-of-living pressures.

Key Perspectives

Federal Government (Minister Murray Watt): Argues the decision balances environmental outcomes with economic needs, and that working with states will reduce inconsistencies and minimise consumer cost impacts while still pursuing waste reduction. Recycling Industry (Mike Ritchie, MRA Consulting): Describes the industry as ‘devastated’ and blindsided. Believes the national standards were essential to drive investment in recycling infrastructure and that the government has broken a clear promise made after years of consultation. Critics/Skeptics: Environmental groups and some state governments are likely to argue that the decision prioritises short-term political convenience over long-term environmental action, and that voluntary measures have already proven inadequate.

What to Watch

Whether state and territory governments proceed with their own harmonised standards, and how they differ from the abandoned national plan.
The timing of any renewed federal commitment – the government has indicated the scheme will not be introduced in this term, pushing any action to after the next election.
The impact on Australia's ability to meet its 2025 National Packaging Targets, which include 70 per cent of plastic packaging being recycled or composted.

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