33 jobs could go unless State Government assists
By Matt Male
INCREASED recycling fees have put the jobs of 33 employees at Wonthaggi Recyclers at risk, but the State Government can help.
The business has joined forces with the Bass Coast Shire Council to place pressure on the State Government to cover the increased fees.
Without the support, Wonthaggi Recyclers faces an unviable future.
Both are urging the State Government to pay the increased fees to Visy Recycling – to then ship it to China – until June 30, when the councils can put up their rates. But so far the State Government’s refusing to hand over any cash – although they’ve got around half a billion dollars sitting in a ‘Sustainability Fund’ which collects money from landfill levies and tip fees.
Wonthaggi Recyclers needs $200,000 to keep kerbside collection continuing until June 30.
And although residents, the shire and Wonthaggi Recyclers have forked out millions of dollars to that fund, the State Government so far hasn’t offered a helping hand – despite meetings with councils and waste contractors.
“The State Government’s got $550 million in the fund, which is the perfect case to use it – just until June 30. That’s all we need,” said Wonthaggi Recyclers managing director Adam Hill.
“Our business cannot sustain the increase without assistance.”
The shire could get the cash out of its back pocket, but it could see major infrastructure projects stall or worse, face the axe.
If the State Government opts to fund the gap until June 30, council can then up the annual garbage levy by about $20.
Although there’s a rate cap in place, it doesn’t include the garbage levy and so councils who separate the levy from their rates can get away with charging above the rate cap.
It’s that $20 per household or residents risk not getting their rubbish picked up because Wonthaggi Recyclers folds (the company encourages residents to continue sorting their rubbish into the respective bins).
That’s a worst case scenario, alternatively, the State Government could continue beyond June 30 to pay the increased fees on behalf of waste contractors to prevent a shut-down of kerbside waste collection.
But negotiations between councils, waste contractors and the State Government have stalled and they’ve got a deadline of next Wednesday, February 28, before Wonthaggi Recyclers need to sign a new contract with Visy.
The contract will mean Wonthaggi Recyclers is forced to pay $60 per tonne to get rid of recyclables – but that fee makes the business unviable. Last year, Wonthaggi Recyclers was actually getting paid $40 per tonne to get rid of the recyclables.
It’s a $100 per tonne out-of-pocket expense and considering the shire goes through 5300 tonnes of recyclables a year, it’s a $530,000 annual fee that someone needs to pay. And Wonthaggi Recyclables can’t cop it – or 33 staff, including 32 who live in the Bass Coast Shire and one in South Gippsland, will face the axe.
The issue’s multiplied by a further 21 regional councils that’ve been hit by the crisis, and it’s understood metropolitan Melbourne will be impacted this week.
Failure to sign that contract will result in Wonthaggi Recyclers either; having to send all the recycling and waste kerbside collection to landfill (and paying around $150 per tonne) or paying an unspecified amount to Visy to send the recyclables to their facilities.
Visy hasn’t answered questions from Wonthaggi Recyclers around how much they will need to pay per tonne, or even if Visy will accept their recyclables, if they don’t sign the contract.
Worse, if Wonthaggi Recyclers sign the contract and the price paid for recyclables in China increases, the extra cash might not be passed on – forcing the company to pay $60 per tonne for the contract that doesn’t end until 2027.
“The council’s been so supportive throughout this. We’ve had constant meetings,” Mr Hill said.
“They haven’t just left out us out to dry. And they don’t want the rubbish to go to landfill, but we can’t stockpile it either.
“The whole world’s relied on China for waste and now they’ve said, ‘We don’t want it anymore. We only want the good stuff’.”
Bass MP Brian Paynter said the State Government needed to use the cash in the Sustainability Fund to help out the Bass Coast Shire and other councils.
He said the money in the half a billion dollar fund should be used to invest in infrastructure.
“For example, we have a power station in Hazelwood that’s just sitting there. It’s doing nothing,” Mr Paynter said.
“We should treat our own waste, there’s an ideal industry that’s ready to be set-up and we’d love to have something happen here, but realistically it’d need to be at a larger regional centre, like Latrobe Valley.”
Mr Paynter said if the State Government refuses to cover the increased costs, ratepayers will be charged again.
“It’s either going to come out of State Government coffers, which they said it won’t, but we’ve all contributed to it. That’s our money, we’ve all had landfill levies whether through garbage charges or at the gate.
“When the new garbage rates are developed, the local council’s going to want their break-even point and that’s about $20 per household per year.
“The ratepayers are going to be charged again. Council’s been good but ultimately they can’t wear it.”
Mr Hill said in Queensland, starting this week, they would dump recyclables in landfill because it’s cheaper and they don’t have to pay a waste levy.
The shire and Wonthaggi Recyclers don’t want to send the rubbish to landfill, following 25 years of recycling education and more recently, the introduction of an organics’ waste bin.
And it would cost $150 per tonne to send it to landfill – compared to $100 out-of-pocket to Visy.
Ideally, the State Government would pay the $100 per tonne to allow Wonthaggi Recyclables and other waste contractors, to remain viable, and ship the recyclables to China until June 30.
Then either the councils would up their rates to cover the extra charge or the State Government could continue to hand out cash until a permanent solution is found.
Mr Hill said the waste could be converted to energy in a regional facility.
“The kerbside recyclables burn hotter with the paper and plastic, and it produces less toxins.
“It’s an alternative form of power that, when the sun isn’t shining and the wind isn’t blowing, would have a constant fuel from households,” Mr Paynter said.
The only other option to solve the crisis is stock-piling rubbish but Mr Hill says that’s out of the question due to EPA rules and regulations.
The Municipal Association of Victoria (MAV), which represents councils, is also highly involved in discussions.
Minister for Energy, Environment and Climate Change Lily D’Ambrosio said, “We are discussing and working with the MAV and industry on this important issue, to ensure that confidence in Victoria’s recycling program is maintained.”