By Deanne Holdsworth, Executive General Manager, Pact Packaging New Zealand

As the Government considers plans to implement a national Container Return Scheme (CRS), it’s time to pause and ask some fundamental questions: What problem are we trying to solve? Is this about reducing litter—or are we truly committed to building a local circular economy that works for Aotearoa?

At Pact, we support the intent behind the CRS. We’ve seen firsthand how such schemes can have a positive impact in Australia. We operate two of the largest PET recycling plants in that country which can collectively recycle around 2 billion PET beverage bottles a year. That’s most of the plastic beverage bottles collected through the state-run scheme. Our experience has taught us that the success of a CRS depends not just on its intent and the amount of material collected, but on its design, execution, and integration into the broader waste and recycling ecosystem.

Beyond Litter: The Bigger Picture 
If the CRS is intended as a litter-reduction initiative encouraging people to take their empty cans and bottles back to collect a refund, we risk missing the forest for the trees. Litter is a symptom, not the root cause, and needs a strategic response.

The real opportunity lies in creating a system that retains valuable materials within New Zealand, reprocesses them locally, and feeds them back into our manufacturing supply chains. That’s how we build a truly circular economy that benefits the environment and creates new jobs for New Zealanders.

Unfortunately, the current proposals raise more questions than answers. Are we collecting containers only to ship them offshore for processing? Or are we investing in the infrastructure needed to recycle these materials here, to the highest possible standard? Without clarity on this, we risk undermining the very sustainability goals the CRS is meant to support

Infrastructure, Investment, and Integration
A CRS cannot exist in isolation. It must be aligned with other stewardship schemes, kerbside collection systems, and the broader product stewardship for all packaging. Fragmentation will only lead to inefficiencies, increased costs, and confusion for consumers and industry alike.

The International Extended Producer Responsibility Alliance (EXPR) draws on its members’ 30 years of experience to recommend harmonisation of Extended Producer Responsibility (EPR) and CRS systems to prevent duplication of collection networks. This is particularly relevant for New Zealand, with its population of 5 million across a geography the size of the UK.

And why limit our thinking to any one stream of containers as is the case in the proposed CRS scheme?  We should draw from other learnings when making an approach to collection and recycling and investigate the use of technologies from non-waste industries to improve our circular economy. For example, using 3D QR codes to help consumers understand which products can be recycled, or broadening the scheme to incentivise the collection of more than just drink containers.

To manage material flows, international best practice shows that the Producer Responsibility Organization (PRO) responsible for the scheme should own the materials collected. This way the PRO can channel the material in the best way to ensure development of local infrastructure and improve the retention and reuse of local material over time.   There needs to be an understanding of the commercial reality of assets needed to collect, process, and then utilise the local materials.

There is a challenge to investing in local recycling infrastructure where there is uncertainty of the waste roadmap for New Zealand and a high-cost barrier to invest.  For those in the recycling industry, commercial realities can be stark. Introducing eco-modulated fees would encourage the use of locally recycled content and help to build New Zealand’s circular economy.  The private sector also needs access to co-investment through centralised funding to ensure there is enough investment in infrastructure to create a viable local circular economy.

If we’re serious about circularity, we need to co-invest in scalable, local solutions that close the loop onshore. Recovery of materials is one step in the solution to minimising litter, we need to ensure that we do not create unintended consequences by making a solve for one issue without ensuring that the end solution is in place. A closed loop local circular economy should be the shining aim, which includes collection, recycling, and remanufacture onshore. This has the benefits of reducing litter, emissions, improving local sustainability and creating jobs, (according to a CSIRO report, some 9 jobs created per 10,000 tonnes of waste recovered).

The Cost of Getting It Wrong 
A poorly designed CRS could have unintended consequences: duplication of logistics, underutilised local infrastructure, and disruption to existing kerbside systems that are already optimised for certain material streams.

Worse, it could erode public trust in recycling altogether.

We urge the government to take a holistic, systems-based approach. Engage with industry. Leverage the expertise of those who’ve operated in this space for years. And above all, ensure that any scheme introduced is fit-for-purpose for New Zealand—not just a copy-paste of overseas models.

A Call for Collaboration 
Let’s take a moment to create a New Zealand solution – this cannot be done in isolation, nor should it be done on paper.  Let’s work together across Government and industry to design something that works—for people, for business, and for the planet.