Few people outside the waste and recycling industry know the worldwide recycling system is on the verge of a meltdown.

For decades, recycling in the developed world has relied on China accepting mixed and dirty recyclable material and sorting it out using extremely cheap labour. Now China is trying to sort out its own environmental issues, and is not prepared to do the dirty work any longer.

Last month, China banned imports of plastic packaging and 23 other types of solid waste. Much tighter limits for contamination of recycling will be introduced on March 1.

Internationally, recycling industry leaders in Britain claim it is the biggest problem they have ever faced, and reports say recycling is being stockpiled around the world.

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The changes also have major implications for recycling in New Zealand.

People are often surprised to learn that most of NZ's plastic recycling is sent overseas, with the exception of small amounts (plastics 1 and 2) which are recycled here. The new rules are going to create upheaval in our recycling systems which have been relying on China to reprocess our waste.

Closer to home, cracks are showing in glass-recycling collections, with kerbside collections imploding in Queenstown and Tauranga.

For the past year, Queenstown's glass has been collected for recycling but ending up in landfill because of contamination issues. In Tauranga, Waste Management recently announced it will not collect household glass from March 1, suggesting people deliver the glass to recycling centres or drop-off points themselves.

Both towns have been running commingled recycling collections where glass is mixed with other recycling materials in kerbside wheelie bins. Waste Management issued a statement saying this practice was "commercially unsustainable" at its Mt Maunganui recycling facility and caused health and safety issues.

Other materials were "easily contaminated by shards" of glass, leading to potentially recyclable materials being sent to landfill. In short, this is the wrong collection method for glass because it causes much of it to break.

The Zero Waste Network has been banging on about "real recycling" for more than a decade. For recycling to live up to its name, materials must be collected and sorted in a way that preserves their future usefulness.

We have to find a better way to fund recycling systems and infrastructure, which are currently funded by councils and ultimately paid for by ratepayers. And we have to redesign systems to produce clean, uncontaminated recyclable material.

Drink bottles and cans are huge contributors to the recycling system but they're also easy to deal with. Those of us who were around in the 70s remember trading bottles for pocket money at the local dairy.

Similar deposit-refund schemes, which fund recycling and reduce litter, are on the rise in Australia and have been the norm in many other countries for more than 40 years. More recently, much of Britain has decided to introduce them.

It's a very simple concept. A 10c deposit is included in the price of a drink and this amount is refunded when the container is returned. The 10c incentive massively increases recycling rates to as high as 82 per cent in Australian states with deposit refund schemes, compared with rates as low as 45 per cent here.

Worldwide, we buy a million plastic bottles every minute and fewer than half of them are being recycled. Plastic has pervaded the food chain, is harming coral reefs and pollutes even the most remote beaches. Scientists estimate there will be more plastic in the oceans than fish by 2050.

A deposit-refund scheme would also relieve financial pressure on councils that are currently forced to pay for recycling infrastructure and systems. A New Zealand report released late last year found councils would save up to $28 million a year in recycling, litter and landfill costs.

The system also offers "bottle-drive" fundraising opportunities for community groups and commercial opportunities for businesses and social enterprises that can operate recycling drop-off stations.

No wonder 83 per cent of New Zealanders support introducing a deposit-refund scheme for beverage containers and a newly released Local Government Waste Manifesto has named it among the top five priorities for councils.

But, as the Local Government Waste Manifesto recognised, we also need to tackle waste at its source. We must reuse everything possible and recycle what's left.

We already have an easy and effective tool to reduce waste but it's not being properly used. The government-imposed waste levy, a charge placed on rubbish taken to landfill, is currently set at $10 per tonne, which is so low very few people notice.

It certainly doesn't make them change their behaviour. Raising the levy to a sensible $140 a tonne, similar to Australia, and applying it to all landfills, would encourage huge waste reduction.

A report last year found that if the levy was raised to this level by 2025, it would slash New Zealand waste by at least 3 million tonnes per year. That's enough rubbish to fill trucks parked nose to tail all the way from Cape Reinga to Bluff, then back to Wellington.

It would also create a net benefit to the economy of $500m annually that would pay for more onshore recycling infrastructure, waste minimisation campaigns and prevention of waste dumping in remote spots.

The authors of a recent report about the levy, A Wasted Opportunity, also said an additional 9000 jobs would be created.

With change comes opportunity. We can treat the pending Chinese recycling industry shake-up as a disaster or we can view it as time to face up to the waste we make in our own backyard and do something about it.

Taking responsibility for our waste on a personal, community and government level will be a giant step towards a zero waste future.

• Marty Hoffart is chair of the Zero Waste Network.