Senator WHISH-WILSON (Tasmania) (18:57): I instigated this inquiry by the Senate Economics References Committee into forestry managed investment schemes. I cannot think of a bigger financial catastrophe in this country than these schemes. Four billion dollars was lost on investment in forestry managed investment schemes, billions of dollars of tax was avoided, and hundreds of thousands of Australians have lost their life savings.
An industry that was supposed to be set up for self-reliance, that used these incentives to invest in trees, was decimated. Those trees were sold at a few cents to the dollar to foreign interests.
Looking back at it, this was Australia’s GFC moment. We had a complex, toxic product that blew up in the face of investors and a few people made a lot of money out of it.
Whether they were financial planners, accountants, the promotors of these schemes, the forestry managed investment scheme companies themselves or listed stock market companies, a few people made a lot of money but lots of Australians lost not only their life savings but also their homes.
Almost no-one has been brought to account on what I think is probably the largest financial scandal in this country’s history.
I have seen the effects in my community in Tasmania: farmers with hundreds of thousands of hectares of trees they cannot touch, that are essentially valueless. What have we done to learn the lessons of history?
The Senate did a good job looking at this.
Unfortunately, it did not go far enough.
The only way to prevent the same kind of catastrophe from occurring again is to remove the up-front tax deductions on these schemes which led to the rorts. We need a royal commission to get to the bottom of this. There are so many institutions and people involved in this—let alone CommInsure, Commonwealth Bank, National Australia Bank, Macquarie Bank and all the other scandals we have heard about in this chamber that the economics committee have examined.
The financial services industry in this country has a culture problem. The only way we are going to get to the bottom of that culture problem and make sure that we have the right laws in place—as you know, Mr Acting Deputy President Williams—is a royal commission, because it has the investigative powers and the resources to call the witnesses that this economics committee, unfortunately, was either unable or unwilling to call.
That includes the accountants, the financial planners, the CEOs of companies and the former ministers who sat on their hands when the bells were being rung, that led to this catastrophe.
If we do not learn the lessons of history, we are bound to repeat them. It is absolutely essential that we back former Senator Mark Bishop, of the Labor Party who, nine months ago, called for a royal commission into financial services.
We need it now.
Watch the Video here:
ONE of the biggest early backers of plantation forestry 10 years ago was Tasmanian Senator Eric Abetz, then Minister for Forests in the Howard government ...
BUT there was some opposition ...
• John Hawkins: The Clearances repeated I suggest, that John Howard and Eric Abetz, for the introduction and promotion of Managed Investment Schemes, a tax scam which has converted over a hundred thousand of acres of the finest dairy country in Tasmania into Nitens plantations, have acted with a similar Ducal disregard for the consequences. Their cohorts in this crime, Paul Lennon, John Gay and Robin Gray, by colluding in the promotion of a pulp mill that consumes annually 3.5 million tonnes of native forest, are performing an act of bastardry, for which they in turn will be hated by generations of Tasmanians to come.
• John Biggs in Comments: Good work Peter for getting this out in the open. What an example of collective insanity and the cost to the victims has been diabolical. Thank you Senator Abetz for that corporate rorting that ruined so many lives. I Am amazed you can have the effrontery to look Tasmanians in the eye.