Victoria will throw $11.3 million at councils to help them deal with the recycling crisis but the state government still can't say whether it will adopt a container deposit scheme.
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The state government announced on Tuesday it will financially support councils to help deal with rubbish recycling after processing giant SKM collapsed.
The company's problems have forced dozens of councils to send recycling straight to landfill - and they still have to pay a "landfill tax" for every load that goes to the tip.
Environment Minister Lily D'Ambrosio came under sustained attack during parliamentary question time from the Greens and the Liberal opposition over her handling of the crisis.
"We are working with councils to deliver what they've asked of us," Ms D'Ambrosio told the parliament on Tuesday.
Despite Liberal leader Michael O'Brien's repeated questions about whether councils forced to send recycling to tips would have the bin tax suspended the minister side-stepped the issue.
Instead she referred to the multi-million dollar relief package to help the councils affected.
"We are absolutely providing immediately relief to councils, we are actually delivering with them what they asked us to do ... as they manage through their contracts with SKM and beyond," she said.
Greens MP Tim Read questioned whether a container deposit scheme would be considered.
"There is no silver bullet that can fix everything," Ms D'Ambrosio said in response.
Instead she said it was a complex issue and there needed to be an end market for recyclable materials.
Earlier Ms D'Ambrosio said defunct company SKM had been undercutting the prices of rivals, with many councils now paying double for collection.
About $6.6 million of the funding package will go to help councils pay for the new recycling collection, which will introduce more bins for households to reduce contamination between materials.
But Ms D'Ambrosio couldn't say what would go into the "fourth bin" for households.
For years, Australia has been sending mixed recycling offshore for other countries to deal with, but the crisis started when China stopped accepting foreign materials.
At the most recent Council of Australian Governments meeting, Prime Minister Scott Morrison declared recycling a national issue and on Tuesday announced $20 million to grow the industry.
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.
Australian Associated Press
