Forestry’s abysmal return

Vica Bayley

Forestry Tasmania not only gets a leg up from millions of dollars of taxpayer subsidies, but they also get special treatment when it comes time to pay up their dividends to Tasmania. If it were a private company, FT’s shareholders would have replaced its executive to provide the direction and leadership it needs in the 21st century. Or perhaps the shareholders would simply have sold out.

Ironically, the news of FT’s financial woes comes just weeks after long-time leader Evan Rolley announced his departure with glowing analogies to cricket and pats on the back from his team mates. Statements like, “there’s a good score on the board, there’s more runs to be made and your side is winning — that’s when you carry your bat,” seem ludicrous and are now proved to be quintessential spin.

The money that taxpayers have invested in this transition has repeatedly been squandered on entrenching the status quo and propping up oldgrowth logging. The public has given well over half a billion dollars to Forestry Tasmania over the last 18 years.

And, The Mercury, June 29: Timber giant probe over smoke haze from hell
A PREDICTED $1-million return to Tasmanians by Forestry Tasmania in 2006/07 is an abysmal outcome.

This is all we get for the destruction of thousands of hectares of Tasmanian forests, mushroom clouds from climate-changing forest burns, degraded water from chemical use and plantation establishment, and sharing our roads with countless log trucks. It’s all we get from the millions of dollars of taxpayers’ money thrown at logging in Tasmania.

Yet analysis of the state budget papers shows that this is all that we can expect.

The fall in return to Tasmanians is caused by a large decrease in sales, predominantly due to the predicted glut of plantation woodchips on the world market. In addition, Forestry Tasmania will be paying a lower percentage of its profit to the state. This reduction in its dividend payout ratio is but another attempt to keep an otherwise sinking enterprise afloat.

Forestry Tasmania not only gets a leg up from millions of dollars of taxpayer subsidies, but they also get special treatment when it comes time to pay up their dividends to Tasmania. If it were a private company, FT’s shareholders would have replaced its executive to provide the direction and leadership it needs in the 21st century. Or perhaps the shareholders would simply have sold out.

Ironically, the news of FT’s financial woes comes just weeks after long-time leader Evan Rolley announced his departure with glowing analogies to cricket and pats on the back from his team mates. Statements like, “there’s a good score on the board, there’s more runs to be made and your side is winning — that’s when you carry your bat,” seem ludicrous and are now proved to be quintessential spin.

Mr Rolley’s departure should be seen as a positive opportunity for Forestry Tasmania to lead our timber industry through the transition that is long overdue. That transition is away from current reliance on logging oldgrowth forests and away from bulk woodchip exports. Clearly, the transition should not take us towards a polluting pulp mill fed on native forests, or wood-fired power generators such as the one proposed at Southwood.

Squandered

The money that taxpayers have invested in this transition has repeatedly been squandered on entrenching the status quo and propping up oldgrowth logging. The public has given well over half a billion dollars to Forestry Tasmania over the last 18 years.

This includes over $150 million from the Tasmanian Community Forest Agreement; over $30 million in 1988 as part of the Helsham Inquiry; $272 million in Forestry Commission debts absorbed by the state government in 1990; $76 million on the signing of the original RFA in 1997; and over $52 million of interest and capital on softwood loans, written off by the federal government in 1998.

Much of this was handed over with the expectation and understanding that an honest and accountable restructure of the timber industry would occur. Yet we still see our forests destroyed, still see jobs in the industry lost and still see the ongoing and unnecessary destruction of forests and wildlife stain the good name of Tasmania in an increasingly environmentally aware world.

Despite the taxpayer propping up oldgrowth logging with over half a billion dollars over several decades, Forestry Tasmania appears unviable. We call on the government to rule out giving Forestry Tasmania any more lavish taxpayer-funded subsidies.

Instead, use the combined opportunity of financial imperative and imminent change in leadership to complete the transition that should have been achieved years ago. There is an estimated $200 million from the Supplementary Regional Forest Agreement as yet unspent.

This money should stimulate the imagination of industry leaders and policy makers to help the timber industry move away from destructive practices in our precious forests. The alternative is yet another taxpayer-funded program where a pulp mill locks us into decades forest destruction and dependence on volatile export commodity markets and the spin doctors keep denying the existence of a problem.

Vica Bayley
The Wilderness Society