A new sustainability initiative imposes stricter standards for government contracting.

Starting from July this year, companies looking to secure federal government contracts will be required to meet stringent sustainability criteria. 

Environment Minister Tanya Plibersek has announced that the new rules will first apply to government construction services contracts exceeding $7.5 million.

This policy is in line with recommendations from the Circular Economy Ministerial Advisory Group. 

“Our national procurement policy will cut waste to landfill, help boost recycling and reduce emissions, all while supporting good, local jobs,” Plibersek says.

The rules mandate contractors to report on waste management strategies, such as the reduction or repurposing of waste and the substitution of single-use materials with recycled content. 

By July 2025, these regulations will extend to include new contracts for textiles, information technology, and other sectors, targeting purchases over $1 million.

Plibersek highlighted the importance of leveraging government purchasing power to promote environmental sustainability in business practices. 

“Just as many Australians look for recycled content or environmentally friendly products at the supermarket, the Australian government will use our purchasing power to back cleaner, smarter, more environmentally sustainable businesses,” she said.

The new standards, developed in consultation with industry groups and construction service companies, are expected to affect approximately 50 per cent of the total value of construction services procurement from the outset. 

The CSIRO has identified that embracing a circular economy could potentially boost Australia’s GDP by $23 billion and create around 17,000 new jobs.