Packaging giant calls for plastic tax on own industry to boost recycling

Australian packaging tsar Sanjay Dayal says the federal government should slap a United Kingdom-style plastic tax on his own industry, or risk Australia ‘spectacularly failing’ its recycling targets.

Pact Group chief executive Sanjay Dayal at the company’s factory in Villawood. Mr Dayal says Australia is at risk of “spectacularly failing” to meet our plastic packaging targets, without government intervention.

Australian packaging tsar Sanjay Dayal says the federal government should slap a UK-style plastic tax on his own industry, or risk Australia “spectacularly failing” its recycling targets.

Pact Group chief executive Mr Dayal – whose company runs the country’s largest PET plastic recycling plant with Coca-Cola, Cleanaway and Asahi – says a dismal 18 per cent of plastic packaging is being recycled or composted in Australia, well below the 70 per cent by 2025 target set in 2018.

The rest is sent to landfill.

And while the federal government also set a target of 20 per cent recycled content in plastic packaging by 2025, Mr Dayal says the industry average is about 3 per cent.

“There’s a strong view among a lot of household people is that once I put (plastic) in the yellow bin, it’s going to go and get recycled,” he said. “I think they would be enormously disappointed if they find out that 82 per cent is still actually going to landfill.”

The Australian revealed this month that federal Environment Minister Tanya Plibersek had granted an exemption to export overseas 20,000 tonnes of plastic collected in kerbside bins for recycling nationally, because local recyclers could not keep up.

Ms Plibersek is in Paris for international discussions to develop a global treaty to end plastic pollution. She said she was “pushing for it to be binding and include strong targets”.

“Our environment can’t afford anything else,” she said.

But Mr Dayal said the federal government needed to do more domestically to force industry to step up its recycling game, including legislating a 30 per cent mandate for recycled plastic content in Australian packaging, and imposing a tax on companies that fail to meet the threshold.

“For those businesses that don’t meet threshold requirements, a financial penalty should be considered,” Mr Dayal said.

“This would both (discourage) businesses from continuing to waste resources and raise valuable revenue to reinvest in incentives.”

Ms Plibersek said the Morrison government made “a lot of flashy promises about recycling but did nothing to deliver them”.

“They promised 70 per cent of plastic packaging would be recycled by 2025, but we’ve been stuck at 16 per cent for years,” she said.

“Unfortunately this means that recycling infrastructure in Australia does not meet our current needs.”

In April last year, the UK introduced a tax on plastic packaging that does not contain at least 30 per cent recycled plastic. The European Union requires a national contribution from each member state based on the amount of non-recycled plastic packaging waste.

Pact’s existing PET recycling plant in Albury has the capacity to process 20,000 tonnes of PET plastic a year, and a second facility will open in October in Melbourne. The manufacturer has the ability to make 100 per cent recycled PET bottles, and its meat trays contain about 40 per cent recycled plastic.

For mum and dad consumers who want to make a difference, Mr Dayal said the best thing to do at the supermarket was to put your money where your mouth was and buy packaging that was recycled, and recyclable.