The Minns Labor Government is pushing ahead with its unworkable coffee cup mandate that will impose more costs and red tape on struggling cafés, rejecting attempts by the NSW Nationals to protect small businesses.
Labor's Environmental Legislation Amendment (Plastic Reduction and Container Recycling) Bill 2026 requires cafés and takeaway businesses to offer customers a reusable cup through a reuse scheme, while preventing them from charging for it.
A barista who forgets to offer a reusable cup during the morning rush could face a $22,000 fine.
This week, the NSW Nationals moved amendments to:
• Remove the mandatory reusable cup scheme, with an offer to work with Labor on a practical alternative.
• Exempt small businesses from the scheme.
• Remove the provision preventing businesses from setting their own charges in relation to the scheme.
Labor and the Greens voted against every amendment.
A record 1,907 NSW companies went bust in the September quarter, up 46.1 per cent on the same period last year, and the highest quarterly total since records began in 1999.
Nationals Leader and Shadow Minister for Small Business Gurmesh Singh said Labor was adding to the burden on businesses already fighting to survive.
"Café owners are working longer hours, watching every dollar and trying to keep their prices affordable. Labor's answer is to give them another cost to absorb, following changes to credit card surcharges and another rule to follow," Mr Singh said.
"The government expects businesses to stock, clean and replace reusable cups, then tells them they cannot charge for the service. Those costs have to come from somewhere."
"At a time of record insolvencies, the Minns and Albanese Labor Governments should be making it easier to keep a business open. Instead, they are making even serving a morning coffee more complicated and expensive."
Shadow Minister for Environment Felicity Wilson said the government had failed to explain how its scheme would work in practice.
"Who pays for cups that are never returned? How will cafés collect and clean them? How is this supposed to work during the morning rush?" Ms Wilson said.
"These are basic questions for the businesses expected to make this scheme work, yet Labor is pushing ahead without providing clear answers."
"Everyone wants to reduce plastic waste, but that requires a practical scheme developed with the businesses that will deliver it."
The Nationals support requiring cafés to accept customers' own clean reusable cups from 2028, a practice many cafés already follow.
