From 1 July 2024, businesses bidding for Australian government construction services projects above $7.5 million must meet agreed sustainability outcomes, including cutting or repurposing waste and replacing single-use materials with recycled materials.
The Environmentally Sustainable Procurement Policy (ESPP) aims to ensure that government officials purchase goods and services that are environmentally friendly, reduce greenhouse gas emissions and promote sustainability.
The announcement occurred alongside the release of the Australian government’s Circular Economy Ministerial Advisory Group (CEMAG) Interim Report, which calls for the development of a national circular economy framework.
“These initiatives aim to create tangible benefits for everyday Australians,” said Engineers Australia CEO Romilly Madew AO FTSE HonFIEAust EngExec, who is a member of CEMAG.
“By transitioning to a circular economy and environmentally sustainable procurement, we are safeguarding our planet for future generations while driving economic prosperity for everyone.”
The policy will guide the government in purchasing products that minimise greenhouse gas emissions, are safe for the environment and last longer.
Madew said the scale of these procurements presents a unique opportunity to make a substantial impact on Australia’s sustainability and net zero ambitions.
“Sustainable procurement isn’t just about buying products; it’s about shaping markets, driving innovation and creating jobs,” she explained. “Prioritising sustainable products and services will help drive demand for new technologies, materials and processes that are environmentally friendly, socially responsible and economically viable.”
Staged implementation
The policy aims to use the government’s purchasing power to give certainty to businesses unsure about investing in the circular economy.
“We’re giving business[es] the confidence to invest in products that support a circular economy, without the green tape. This is important work that will help leave nature better off for our kids and grandkids,” said Tanya Plibersek MP, Minister for the Environment and Water.
It will initially cover construction projects costing more than $7.5 million, but will be expanded from 1 July 2025 to include tenders for textiles and ICT goods, as well as furniture, fittings and equipment above $1 million.
“Our national procurement policy will cut waste to landfill, help boost recycling and reduce emissions – all while supporting good, local jobs,” Plibersek continued.
Plibersek drew direct links to the Future Made in Australia policy recently announced by Prime Minister Anthony Albanese.
“This will deliver a future remade in Australia, creating opportunities and demand for goods to be recycled and remanufactured right here. It’s a win for business, and a win for the environment.”
CEMAG’s recommendations
The report goes further than a procurement policy, making 20 recommendations that aim to direct Australia’s shift towards a circular economy with a strong emphasis on enhancing materials efficiency, reducing energy demand, minimising waste and achieving net zero emissions.
“Engineers Australia is proud to contribute our expertise to CEMAG and supports the call for urgent regulatory reform and coordinated action outlined in the Interim Report’s preliminary recommendations,” Madew said. “We advocate for regulatory frameworks that foster circularity, addressing priority issues like strategic policy setting and economic leverage for circular markets.
“Engineers will play an increasingly critical role in transitioning to a circular economy by implementing principles that promote materials efficiency, reduced energy demand, waste minimisation, and achieving net zero emissions. We commend the government’s commitment to environmentally responsible practices and look forward to seeing the positive outcomes of this work.”
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