The prime minister is allocating $20 million to grow Australia's recycling industry and start the transition to banning waste exports.
Scott Morrison on Tuesday announced the fund for innovative projects to boost the domestic recycling industry as part of the coalition's commitment to ban the export of plastic, paper, glass and tyres.
"We are committed to protecting our nation's environment while also building our capacity to turn recycling into products that people want and need," Mr Morrison said in a statement.
The announcement comes amidst a recycling crisis in Victoria sparked by the collapse of major processor SKM which forced several councils to send material to landfill.
China's decision last year to ban the importation of foreign waste has also caused recycling woes for Australia.
Mr Morrison revealed his government's commitment to banning the export of the four recyclable materials at the Council of Australian Governments meeting in Cairns last week.
Along with state and territory leaders, the PM laid out a plan for the country's environment ministers to improve the recycling system.
Industry Minister Karen Andrews said the funds will also help create Australian jobs and reduce plastic pollution.
Australia spent $2.8 billion exporting nearly 4.5 million tonnes of waste last year, with the vast majority of it going to Vietnam, Indonesia and China.
While NSW has the most people, it exported less waste than Victoria and Queensland, and only just more than Western Australia which has about a quarter of the population.
"Boosting our onshore plastic recycling industry has the potential to create over three times as many jobs as exporting our plastic waste, ensuring a more sustainable and prosperous future," she said.
The $20 million funding will be made available through the government's Cooperative Research Centres Projects grants which open on Tuesday.
Australian Associated Press