The voluntary administration of Recycling Plastics Australia has placed about 60 Adelaide jobs and a significant part of Australia’s plastics-processing capacity at risk, intensifying industry criticism of the Federal Government’s decision not to introduce a national packaging scheme during its current term.
Tim Mableson and Edward 'Ned' Swifte of KPMG were appointed voluntary administrators of Recycling Plastics Australia and associated company Blackburn Inwood No.1 Pty Ltd on 31 August.
The administrators have begun an urgent assessment of the company’s financial position and operations. The first meeting of creditors is scheduled for 10 September.
Based at Kilburn in Adelaide’s inner north, Recycling Plastics Australia processes mixed rigid plastics into granulated and pelletised feedstock. Its administration also raises questions over the future of a major advanced mechanical recycling project intended to process 14,000 tonnes of soft plastics annually.
In July 2024, the Australian Government announced a $20 million investment in the project through the Recycling Modernisation Fund Plastics Technology stream. The project was valued at $40 million and expected to create 45 jobs.
The new facility was designed to clean and purify shopping bags, food wrappers, chip packets and other flexible plastics, producing feedstock that could ultimately be used in new packaging. When PKN reported on the project in 2024, commissioning was expected by mid-2025.
The company was also allocated $8.89 million through an earlier government recycling infrastructure funding round in 2021. That funding was intended to improve mixed-plastics sorting, grinding, washing and pelletising at the Kilburn operation as part of a $25 million project.
Soft Plastics Stewardship Australia (SPSA) said Recycling Plastics Australia had not completed construction of its soft plastics processing facility and had therefore not been contracted by the stewardship organisation. “This does not affect SPSA,” it said.
SPSA also confirmed it had recently met Federal Environment Minister Murray Watt and senior state and federal officials to present specific industry requests. It said its push for nationally harmonised packaging regulation – aimed at improving productivity and protecting sovereign processing capability and supply-chain resilience – would continue and would be central to its forthcoming economic report.
ACOR warned of viability crisis
Australian Council of Recycling CEO Suzanne Toumbourou told PKN RPA's administration followed more than a year of warnings about the financial position of plastics recyclers.
“For over a year, we have been very clear that the viability of Australia’s plastic recycling sector – particularly those managing plastic packaging – is on an unsustainable trajectory,” Toumbourou said.
“We have provided strong and compelling evidence and analysis to governments and understood there to be a commitment by the Federal Government to deliver the reforms necessary to support this industry.”
Toumbourou said the government’s decision to defer a new national packaging scheme had been confirmed on the same day that a major plastics recycler entered administration.
“It is devastating to be watching this slow-moving crisis materialise, and baffling that the government would not move to support not only this industry, but this important, government co-funded sovereign capability,” she said.
“This is particularly concerning given the government has also banned the export of plastic waste, which means we must have the capacity to recycle it here.”
In correspondence seen by PKN, the Department of Climate Change, Energy, the Environment and Water advised stakeholders: “The Minister has communicated that a new Commonwealth scheme for packaging will not be introduced in this term of government.”
The department said the government was instead focused on working with state and territory governments on opportunities to improve Australian packaging regulations and policies in the nearer term.
Asked whether further recycling failures could follow, Toumbourou said the sector remained under severe pressure.
“I know other plastics recyclers are doing everything they can to maintain their capability and are working as hard as they can under extremely tough conditions,” she said.
“I cannot predict what might come next, but the analysis ACOR has undertaken in partnership with APCO does not show a healthy trajectory in the absence of reform.”
WMRR calls for urgent action
Waste Management and Resource Recovery Association of Australia CEO Gayle Sloan said RPA's administration should be an inflection point and move packaging reform to the top of the agenda when Australia’s environment ministers meet this month.
“Recyclers invest millions in Australian facilities and jobs, process an ever-growing volume of plastic and compete against cheap virgin and imported recycled materials,” Sloan said.
“Meanwhile, producers can place low-value, poorly designed packaging on the Australian market without funding its recovery or using the recycled materials created. That is not a circular economy. It is an economic regime designed to make Australian recycling fail.”
WMRR is calling for extended producer responsibility, packaging design requirements and measures to build demand for Australian recycled materials.
“We need an economic regime that recognises the true cost of packaging, rewards Australian recovery and remanufacturing, and stops penalising the recyclers doing the work,” Sloan said.
PKN has approached other stakeholders for comment.
