Mr Frydenberg said waste management and recycling was "primarily the responsibility of state, territory and local governments who have a number of different methods to encourage recycling to reduce the impact of waste on the environment”.
“Australia supports international efforts to reduce pollution and protect the environment.”
But Ms Sloan of the WMAA said the federal government's approach had been "wholly inadequate when considering the importance of this essential industry" with an annual turnover of $15 billion and employing 50,000 people.
"[It's] simply too important an industry for [Minister]Frydenberg to continue his mantra that it's up the states," she said.
Peter Whish-Wilson, the Tasmanian Greens Senator, said Australia's "system of kerbside recycling that has been in place for decades is collapsing".
"Without being able to on-sell the waste, companies are walking away from their waste collection contracts and recycling is being stockpiled without a plan for what to do with it," he said.
Senator Whish-Wilson said the federal government had had "at least a year's warning" China would end imports", and yet it had done nothing to prepare for it.
“Victoria has been in crisis for a month with contracts failing and councils having to go elsewhere to get their recycling collected," he said. "We now know that this has just begun in NSW."
LG NSW's Cr Scott said councils in her state were already seeking support to develop new markets for recycled glass, paper and plastics.
"Councils alone can't be asked to save the recycling industry in this state," she said.
"There is an immediate need for financial assistance and fast-tracking of approvals for on-shore reprocessing and remanufacturing."
Glass sand for pipe bedding, road base and asphalt, were examples of new markets.
Cr Scott said the NSW government collected $659 million in waste levies in the 2016-17 financial year but her organisation's research showed only 18 per cent of those funds were returned to local government. That curbed councils' ability to invest in waste and recycling infrastructure.
A spokeswoman for Sydney's InnerWest Council said China's limits involved a tightening of accepted contamination levels in recycling imports. "[If] clean, uncontaminated recyclables are sent to China they will still be accepted".
"There have not been any impacts on council’s recycling contracts so we’d encourage the community to keep recycling and if anything changes, then we will communicate that," she said.
Trevor Thornton, a hazardous materials management lecturer at Deakin University, told The Age in January the state's recycling industry faced a 50-50 chance of collapse.
Council rates would likely rise, with Victorian councils already allocating about one-eighth of their annual budgets, totalling about $600 million a year, for kerbside recycling, he said.
Peter Hannam is Environment Editor at The Sydney Morning Herald. He covers broad environmental issues ranging from climate change to renewable energy for Fairfax Media.
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