The Victorian government is working behind the scenes to prevent recycling from going to landfill, as the man behind a major kerbside recycling firm vows to shut down his operation.

Giuseppe Italiano, the founder of SKM Recycling, which collects about half of the state’s kerbside recycling, told the Herald Sun he has run out of money and plans to close his doors and destroy his plant and equipment.

“We are closing up next week, I am closing the doors and destroying the machinery. Someone is out there playing games to have me closed down,” he told the paper.

But Labor MP Jacinta Allan told reporters on Sunday the government had already invested $135 million on a range of actions to prevent recycling ending up in landfill.

“If that eventuates, if that private company makes that decision – and that’s a decision for them – the government has already been working ahead of this potential outcome occurring,” she said.

“The government has already been working on bringing alternative industry players into this sector and also working with local governments about what alternatives are available to them.”

More than 30 local councils currently have contracts with SKM, making up about 50 per cent of kerbside recyclables.

SKM Services Pty Ltd director Robert Italiano, 46, faced Melbourne Magistrates Court on July 16 charged with five counts of breaching the Environment Protection Act following a blaze at the firm’s Coolaroo site.

The fire started on July 13, 2017, and took 11 days to be extinguished.

Last week the company was banned from accepting recyclable waste at another of its Melbourne plants at Laverton North.

The state’s environmental watchdog had previously ordered the company to reduce the site’s stockpiles of waste. Instead, they allegedly increased, sparking the ban.

-AAP