Peter Costello

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Productivity Commission to Examine Waste and Resource Efficiency



The Treasurer and the Minister for the Environment and Heritage today announced that the Productivity Commission will examine the way Australia manages its waste and products over their life-cycle.

The Treasurer said the inquiry will look at the current policy framework and cover issues associated with solid waste, including municipal waste (such as household collections, electrical and consumer items), commercial and industrial waste, and construction and demolition wastes.

The inquiry will investigate the economic, environmental and social costs and benefits of a range of regulatory and voluntary approaches to managing waste, including the compliance and processing costs of these instruments.

Minister for the Environment and Heritage, Senator Ian Campbell, said waste occurred at all stages of a product’s life, from the extraction and production of materials to the product’s distribution and final post-consumption phase. Inefficient management of waste results in lost value and opportunities, and is an economic and environmental burden on society.

Senator Campbell said the inquiry would look at factors which impede our ability to use and recover our resources efficiently. He said it would identify strategies that could be adopted by governments, industry and consumers to encourage the best possible recovery of resources and to promote a more coordinated and strategic approach to waste issues across the life-cycles of products.

The Productivity Commission will shortly invite expressions of interest from anyone wanting to participate in the review. Anyone with any interest in the inquiry is encouraged to make a submission to the Commission.

The terms of reference for the study are attached.

Further information on the study can be obtained from the Productivity Commission’s website at or by contacting the Commission directly on (02) 6240 3239.


Contact: Amanda Kennedy 03 9650 0244

Terms of Reference


Productivity Commission Act 1998

I, PETER COSTELLO, Treasurer, pursuant to Parts 2 and 3 of the Productivity Commission Act 1998, hereby refer waste generation and resource efficiency in Australia to the Commission for inquiry and report within twelve months of receipt of this reference. The Commission is to hold hearings for the purpose of the inquiry.


Australians generate solid waste at a high rate compared with most other OECD countries. Technologies and processes to avoid, reduce and recover waste are generally not used as extensively in Australia as in some other OECD countries. Non‑optimal levels of waste represent lost value and opportunities, while imposing undesirable economic and environmental costs on society. The objective of this inquiry is to identify policies that will enable Australia to address market failures and externalities associated with the generation and disposal of waste, including opportunities for resource use efficiency and recovery throughout the product life-cycle (from raw material extraction and processing, to product design, manufacture, use and end of life management).

The inquiry will cover resources associated with solid waste, including: municipal waste (eg household collections, electrical and consumer items,) commercial and industrial waste, and, construction and demolition wastes. It will not cover wastes that exhibit hazardous characteristics and pose an immediate and unacceptable risk of harm to human beings or the environment.

Scope of the Inquiry

In undertaking this inquiry, the Commission is to examine ways in which, and make recommendations on how, resource efficiencies can be optimised to improve economic, environmental and social outcomes. This will include an assessment of opportunities throughout the product life cycle to prevent and/or minimise waste generation by promoting resource recovery and resource efficiency.

The Commission is to examine and report on current and potential resource efficiency in Australia, having particular regard to:

  1. The economic, environmental and social benefits and costs of optimal approaches for resource recovery and efficiency and waste management, taking into account different waste streams and waste related activities;
  2. Institutional, regulatory and other factors which impede optimal resource efficiency and recovery, and optimal approaches to waste management, including barriers to the development of markets for recovered resources;
  3. The adequacy of current data on material flows, and relevant economic activity, and how data might be more efficiently collected and used to progress optimal approaches for waste management and resource efficiency and recovery;
  4. The impact of international trade and trade agreements on the level and disposal of waste in Australia; and
  5. Strategies that could be adopted by government and industry to encourage optimal resource efficiency and recovery.

The Commission is also requested to report on: the effectiveness of performance indicators to measure efficiency of resource recovery practices; the effect of government and commercial procurement practices on optimal resource recovery; and the impacts of government support to production and recovery industries.

In undertaking the inquiry, the Commission is to advertise nationally inviting submissions, hold public hearings, consult with relevant Australian Government, State and Territory agencies, local government and other key interest groups and affected parties.

The Commission is to provide both a draft and a final report. The Government will consider the Commissions recommendations and its response will be announced as soon as possible after the receipt of the Commissions report.


20 Oct 2005

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