The Statement

"In New South Wales, they impose a waste levy on councils and industry where they raise over $750 million each and every year, and only 18 per cent of it goes back in to the waste industry, in the form of education via councils."

David O'Loughlin, Australian Local Government Association president and mayor of Prospect, South Australia. June 18, 2019.

The Verdict

Mostly True - Mostly accurate, but there is a minor error or problem.

The Analysis

Mayors around Australia are demanding the federal government show leadership on the national "recycling crisis" and take urgent action to reduce stockpiles of waste building up around Australia following China's decision to stop importing plastic waste.

David O'Loughlin, president of the Australian Local Government Association (ALGA) and mayor of Prospect in South Australia, claimed the states were collectively sitting on more than $1 billion in their waste levy accounts. He urged the states to use this money to work with local and federal governments and industry to find on-shore solutions to recycling. [1]

AAP FactCheck examined Mr O'Loughlin's claim that NSW raises $750 million each and every year from waste levies and that only 18 per cent goes back to the waste industry via councils.

NSW budget 2018-19 papers show $726 million in revenue was collected in waste and environment levies in 2016-17. [2]

NSW budget 2019-20 papers show the figure rose to $769 million in 2017-18 with a steady revenue stream for the following years - $772 million in 2018-19 and $771 million in 2019-20. [3]

Based on this evidence AAP FactCheck found Mr O'Loughlin's claim that NSW raises over $750 million each and every year to be mostly true.

A spokesperson for the NSW Local Government Association (LGNSW), a member of ALGA, told AAP FactCheck Mr O'Loughlin's claim that only 18 per cent of the NSW government's waste levy revenue was returned to local government was sourced from the ALGA 2018-19 budget submission. The submission estimated 18 per cent of waste levy revenue contributed by local governments was returned to councils. [4]

AAP FactCheck examined if only 18 per cent of the amount local government paid towards the state government waste levy was returned.

The LGNSW submission relied on 2017-18 NSW budget figures for its calculation. It estimated $2.13 billion would be collected through the waste and environment levy across the four financial years from 2017-18 to 2020-21. [5]

According to a review of the NSW waste and environment levy commissioned by the NSW Environment Protection Authority and conducted by KPMG, local government contributes 32 per cent of levy revenue. On the 2017-18 budget figure estimates of $2.13 billion, 32 per cent is $682 million. [6]

NSW government hands back waste levy funds to local government for recycling via the Waste Less, Recycle More (WLRM) initiative. The initiative gave local government $70 million over four years plus, according to LGNSW, the chance of applying for a further $100 million. [7]

The LGNSW submission assumed a success rate of 50 per cent for the contestable $100 million, meaning $120 million could go to local governments in total across four years.

That means 17.6 per cent share or $120 million goes back to local council for waste management and recycling from a pool of $681.6 million contributed by local governments to the state waste levy revenue, or just under 18 per cent as Mr O'Loughlin claimed.

Based on this evidence AAP FactCheck found Mr O'Loughlin's claim that only 18 per cent of funds collected from local governments through the waste is returned to be mostly true. The minor problem is that the 18 per cent was calculated on 2017-18 NSW budget figure estimates, not on higher more recent figures published in the 2019-20 NSW budget, which Mr O'Loughlin also referenced.

The Verdict

Mostly True - Mostly accurate, but there is a minor error or problem.

The References

1. 'Mayors urge Federal Government to deal with Australia's recycling crisis', ABC Radio RN Breakfast. June 18, 2019: 2019:https://abcmedia.akamaized.net/rn/podcast/2019/06/bst_20190618_0636.mp3

2. 2018-19 Budget NSW Statement. Revenue. NSW Government. Page 8: https://www.budget.nsw.gov.au/sites/default/files/budget-2018-06/5._Revenue-BP1-Budget_201819.pdf

3. 2019-20 Budget NSW Statement. Revenue. NSW Government. Page 6: https://www.budget.nsw.gov.au/sites/default/files/budget-2019-06/4.%20Revenue-BP1-Budget_201920.pdf

4. 2018-19 Budget - Submission of NSW Local Government Priorities. Waste Levy Page 30. Local Government NSW: https://lgnsw.org.au/files/imce-uploads/90/LGNSW-Budget-Submission-2018-19-June-2018.pdf

5. NSW Budget Statement 2017-18. Paper No1. NSW Government. Table 5, Page 5-7: https://www.budget.nsw.gov.au/sites/default/files/budget-2017-06/2017-18%20Budget%20Paper%201%20-%20Budget%20Statement-1.pdf

6. Review of the NSW Waste and Environment Levy Final Report. KMPG (Page 16). June, 2012: https://www.epa.nsw.gov.au/~/media/EPA/Corporate%20Site/resources/wasteregulation/waste-levy-review-report.ashx

7. 'Waste Less, Recycle More - A $337 million grants and funding initiative 2017-2021'. NSW Government (Page 4). October 2016: https://www.epa.nsw.gov.au/-/media/epa/corporate-site/resources/waste/waste-less-recycle-more-2017-21-brochure-160538.pdf?la=en&hash=7C6B86664897EBE5ECA8702C6E0BD3D6D976DA0E

* AAP FactCheck is accredited by the Poynter Institute's International Fact-Checking Network, which promotes best practice through a stringent and transparent Code of Principles. https://factcheck.aap.com.au/

Australian Associated Press