The powerful beverages industry offered to display anti-littering messages on its trucks and spend $3.5 million a year on NSW recycling programs in a bid to kybosh the government's plans for a cash-for-containers scheme.

The unsuccessful offer, which the industry is scrambling now to improve, was deemed risky and inadequate by the government, and casts doubt on the industry's commitment to decreasing littering and improving recycling rates.

After more than a decade of community and political debate, the NSW government is planning to introduce a container deposit scheme, in which a refundable deposit, probably 10¢, would be added to the cost of every drink bottle and can.

Consumers could redeem the money by recycling containers at "reverse vending machines" in public places such as shopping centres and at community recycling depots.

Proponents say the scheme would encourage recycling and divert many of the one billion plastic bottles that go to landfill in Australia each year.

The beverage industry says the move, which would raise the cost of beverages initially, would mean job losses.

The industry had proposed an alternative national scheme involving bins and other recycling infrastructure, and anti-littering education campaigns. However, the NSW government said the plan was a significant policy and funding risk, which lacked clear governance arrangements, specifics and long-term funding.

It has emerged that the industry offered $33.5 million nationally each year for a decade, about 30 per cent of which would have been allocated to NSW.

Of the roughly $10 million annual NSW funding, the industry would have spent $3.5 million on recycling programs and $1.5 million on advertising that contained an anti-litter message. It also offered to display the anti-litter message on its trucks and carry out letterbox drops.

It is understood the remaining $5 million, which was not guaranteed, involved "leveraged investment" through partnerships with the recycling industry.

Government sources said the offer fell far short of the funding required to deliver long-term improvements in recycling and litter reduction.

In a letter to the beverage industry last month, NSW Premier Mike Baird and Environment Minister Rob Stokes said a far greater commitment and contribution from the industry was required.

A spokesman for the Australian Food and Grocery Council said the industry was working on a new proposal, which would be presented to the government soon.

It is understood the government will consider a revised offer, but still favours a container deposit scheme as the best way to achieve its ambitious litter-reduction targets.

Total Environment Centre executive director Jeff Angel said the beverage industry was so ideologically opposed to container deposit schemes that it had been blinded to working with the community and government on the effective solution.

South Australia and the Northern Territory already have container deposit schemes. The debate is shaping as a NSW election issue and the Australian Beverages Council has threatened to run attack advertising against the government if it supports a container deposit policy.