Response to the enforcement of the China National Sword Policy

The NSW Government and the EPA are committed to working with councils, regional waste groups and industry to improve and strengthen our recycling systems in NSW.

Changes to the recycling industry in NSW

Until recently, China was a large importer of recyclable materials, accepting more than 30 million tonnes of waste from all over the world every year. Australia alone sent 1.25 million tonnes of recycled material to China in 2016-17 which is now impacted by National Sword. At the start of January 2018, however, China began to stringently enforce restrictions on the importation of recycled materials under its National Sword policy. This policy has impacted the global market for recyclable material, including the recyclable material that is currently collected in NSW.

Coordinating efforts across sectors

Effectively responding to this issue requires a collaborative approach. The EPA is committed to helping local government, industry and the community work together to find an effective solution.

The EPA has met with representatives from state, local and federal government, industry, recycling associations, the not-for-profit sector and environment groups to help the EPA to understand the extent of the impact of China’s National Sword policy and develop short, medium and long-term solutions in response to these challenges.

While industry faces immediate pressures to find alternative markets for recycled materials, this is an opportunity to strengthen local markets and the NSW recycling industry.

$47 million to support recycling in NSW

In March, the NSW Government announced a support package of up to $47 million to help local government and industry to respond to these global changes.

The support package is being funded by the Waste Less, Recycle More initiative and provides a range of short, medium and long-term initiatives to ensure kerbside recycling continues and to promote industry innovation.

The funding will:

  • enable councils to off-set some extra costs associated with kerbside recycling collections subject to guidelines
  • improve council tendering processes to increase the production and use of recycled products
  • fund community education initiatives to reduce kerbside recycling contamination.

The package also includes $4.5 million to support co-investment in infrastructure projects to improve the quality of recycled materials produced by MRFs and reduce the amount of unrecyclable material left at the end of the recycling process, and $5 million to fund grants and programs that identify new uses for recyclable materials and increase the production and use of recycled products.

Applicants seeking funding will need to meet certain guidelines to ensure that initiatives best address the China National Sword issue, represent better value for money and demonstrate clear benefits to the community such as increased levels of service.

More information on the grants available and new funding guidelines is available on the relevant grant pages.

Inter-governmental taskforce

A whole-of-government approach is required to coordinate immediate interventions, as well as plan longer-term solutions. To this end, the NSW Government has established an inter-governmental Taskforce to urgently progress a longer-term strategic response to National Sword.

This Taskforce is led and chaired by the NSW EPA. The Taskforce includes representatives from the Department of Premier and Cabinet, including the Cross-Border Commissioner, NSW Treasury, Department of Finance, Services and Innovation, Roads and Maritime Services, Fire & Rescue NSW, Department of Planning and Environment, Office of Local Government, Department of Industry, and the Office of the Small Business Commissioner.

The support package enables a rapid and well-funded response to support recycling across NSW. Longer term solutions are also required to ensure NSW can continue its strong recycling record, and the Taskforce’s work is focused on long-term actions, including: examining the use of recycled products and scouting opportunities to increase the use of recycled products, developing a circular economy policy for NSW and pursuing a national policy, and examining long term recycling strategies and support requirements.

This Taskforce will consult widely with industry, local government and other relevant stakeholders.  The EPA anticipates opportunities for industry, local government and other stakeholders to join future planning and response groups, and these opportunities will be advertised on the EPA website.

Temporary increases to stockpiling limits

The global changes to the recycling market means that recyclers are currently working to find new places to sell their recyclable materials. To assist industry, and to stop recyclable material from going to landfill, the EPA will consider temporary increases to stockpiling limits on a case-by-case basis.

The EPA recognises that any temporary benefits of increasing stockpile limits need to be carefully balanced with the safety of the community and environment.

Applications made to the EPA to temporarily increase stockpiling limits must

  • address potential risks such as fire, public health, workplace safety, odour and other environmental risks.
    • provide detailed site information such as existing development consent
    • The proposed increase being sought
    • The timeframe for temporary storage
    • Infrastructure currently in place
    • Any other information relating to potential impacts to the surrounding environment and community.

If you would like to review or apply for a variation to your operating conditions, please contact The EPA’s Environment Line ph: 131 555.

The EPA is also available to provide support and advice to facilities that are currently not required to hold an Environment Protection Licence but that may be required to become licensed due to the temporary increase in stockpiling limits. Please contact the EPA, should you wish to explore this option.

Grants and assistance

On 20 March 2018, the NSW Government announced a support package of up to $47 million to help local government and industry respond to global recycling changes. This significant support package is funded by the existing Waste Less, Recycle More initiative. This form and source of funding enables a rapid and well-funded response to support recycling across NSW.

Inside the levy region

Levy-paying councils

Councils within the levy paying area can continue to access funding through the Better Waste and Recycling Fund. This is a pre-existing, non-contestable funding program to support levy-paying councils to improve recycling, reduce waste generation and tackle litter and illegal dumping.

Councils will receive the same amount of funding under BWRF as they have previously been allocated, but the NSW EPA has updated the funding guidelines to ensure councils can direct their funding towards responding to National Sword. Program participants can now use BWRF funds to pay for the additional costs associated with the collection of dry recycling and to develop a long term Strategic Plan for dry recyclables.

Some projects that work to alleviate the impacts of the China National Sword policy are already permitted under the existing BWRF Guidelines, such as education to reduce contamination and market development for recycled content products.

Outside the levy region

Non-levy paying councils – the new Recycling Relief Fund

The Recycling Relief Fund is a new $2.5 million program designed to help local councils and regional waste groups in rural and regional areas temporarily offset increased recycling costs. The program is a capped dollar-per-tonne assistance payment for household dry recycling for a maximum of four-months, over the period 1 March to 31 August 2018.

The program’s approvals and payments have been designed in line with similar EPA programs that aim to provide funds urgently. The EPA recognises that fast approval and payment times are integral to supporting councils and the ongoing provision of recycling services for households.

As part of accessing this new funding program, councils and regional waste groups will be required to develop their own strategies to manage dry recycling systems in their community.

Regional Waste Groups- Regional Coordination Support package

Waste groups in regional and rural NSW have been operating and funded by the NSW Government for 20 years. They work collaboratively with the government and local councils on a regional basis to deliver improved recycling and better waste management.

The Regional Coordination Support package continues this funding. Wherever possible we encourage regional waste groups to continue to use the Regional Waste Coordination Funds for regional waste coordinators, and existing projects and activities. However, groups may wish to refocus some funding and resources where required to identify priority projects resulting from lower commodity prices and impacts from the China National Sword policy. This is entirely the decision of the groups.

Regional waste groups should continue to develop new regional projects and to support councils to apply for grants. These projects may include:

  • community education to avoid waste and reduce contamination in the dry recyclables stream
  • new or enhanced infrastructure to reduce contamination in the dry recyclables stream
  • facility improvements and market development to identify new uses and increase local processing of recyclable material
  • increase purchasing and specification in contracts of recycled content material, including glass sand.

Material Recycling Facilities, Industry and Others

Product Improvement Program: this program will support the NSW resource recovery sector to respond to changes in recycling markets and meet NSW waste and resource recovery targets.

The program targets waste generated by households (yellow-lid bin) and commercial and industrial premises (mixed paper/cardboard, plastics, glass, tyres, engineered and treated timbers, e-waste and plasterboard), but will give preference to projects that prioritise glass and materials affected by China’s National Sword policy; that is, mixed paper/cardboard and plastics.

The program supports co-investment in infrastructure projects that aim to

  • improve the quality of recycled materials produced by materials recycling facilities to better supply local and international markets and reduce the amount of unrecyclable material left at the end of the recycling process
  • increase the amount of waste materials recycled in NSW and divert additional waste from landfill
  • increase in NSW the capability and capacity to recover and reprocess waste materials (with priority given to mixed paper/cardboard, plastics and glass)
  • increase the use of recovered plastics, glass, and mixed paper/cardboard in the manufacture of products within NSW 

Circulate and Civil Construction market: These are existing programs designed to support the recovery of C&I and C&D waste through business to business solutions. These grant programs will continue to be offered and are open to businesses, not-for-profit organisations, councils, industry bodies, product stewardship groups, local government, consultants, waste service providers. The NSW EPA has expanded the eligibility to ensure funding for grants and programs that identify new uses for recyclable materials and increase the production and use of recycled products.

Further information and assistance

The EPA is working closely with the Office of Local Government (OLG) to help provide councils with other forms of support for their waste and recycling services, including negotiation of kerbside recycling collection and processing services, community education, and more.  The EPA is also working with OLG to engage with councils and investigate other avenues where we assistance would be useful.

The EPA encourages councils to get in touch with Local Government NSW before renegotiating kerbside recycling contracts.

Longer-term solutions are being developed by the NSW National Sword Inter-governmental Taskforce.

Local government organisations

CDS revenue sharing arrangements between MRFs and councils

The CIE model and user guide are now available for download:

EPA contact

For more information on programs for local councils and regional waste groups email

For other EPA information, contact the Environment Line on 131 555

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