It will of course be old news to Tasmanian Times’ readers who have been warned for years by TT Analyst JOHN LAWRENCE of Forestry Tasmania’s incompetent, capricious, spoilt and arrogant approach to the management of Tasmania’s forests. Now the Legislative Council has put its Upper House imprimateur on a highly questionable performance in its report into the financial performance of FT.
The report of the Leg Co Committee, chaired by fiercely independent member Ruth Forrest, was tabled on Wednesday.
• Graeme Wells, in Comments: In its pulpwood supply contract with Gunns in 2007, the price was indexed to the BHKP PIX price index in Euros. In effect, FT wrote a contract which exposed it to the risk that the $A would appreciate against the Euro. Since late 2007 the $A has appreciated from around 0.6 Euro to around 0.75 Euro. Perhaps prudent managers might have hedged that risk? A bit late to complain about exchange rate risk now, perhaps?
Loretta Johnston in the Examiner: Concern at report on Forestry Tasmania
FORESTRY Tasmania says it is deeply disappointed with a Legislative Council report that expresses concern about its financial viability.
The report on the committee’s inquiry into Forestry Tasmania’s financial performance was tabled yesterday.
It was also critical of the organisation for not readily providing information.
“In general terms, the committee found that the majority of the information sought was straight forward financial information that would already have been readily available to them,” the report reads.
Forestry Tasmania managing director Bob Gordon said the company was under “considerable pressure at the time of the hearings, dealing with three separate state and federal parliamentary inquiries, a pending state review of its operations, the statement of principles process and managing the most severe market conditions in decades.
“Perhaps the quality of our submissions and evidence were not of a sufficiently high standard and that is regrettable,” he said.
Forestry Tasmania’s operating cash position for 2010-11 is recorded as a deficit of $12.117 million but, according to the report, the organisation requires a minimum operating cash flow of $20 million to cover capital expenditure.
The committee found that Forestry Tasmania’s cashflow challenges included the organisation’s requirement to meet community service obligations, the costs associated with its defined benefits superannuation liability and the effect of the annual revaluation of its biological assets on profit.
The committee also reported that at July 4 this year, the organisation was owed $37 million, of which $27 million was overdue with some debts well outside normal commercial payment terms.
The committee was also critical of shareholder ministers, Treasurer Lara Giddings and Resources Minister Bryan Green, for taking a “hands-off approach” to the financial performance issues facing Forestry Tasmania.
“Given the nature of the problems facing Forestry Tasmania it was difficult to understand why the government would have adopted such an approach in the circumstances,” the report says.
Mr Green said the government was considering the report and was working constructively with the Forestry Tasmania board through the strategic review of the organisation.
Loretta Johnston in The Examiner HERE
• Kim Booth: Forestry Tasmania treats Leg Co Commitee with disdain
FT TREATS UPPER HOUSE COMMITTEE WITH SAME DISDAIN AS ENGOS
Reluctance to Provide Requested Data Unacceptable
Kim Booth MP
Greens Forestry spokesperson
The Tasmanian Greens today called for the Legislative Council Committee Report of the Inquiry into Forestry Tasmania Financial Performance to be submitted for consideration by the independent Strategic Review of this Government Business Enterprise (GBE) which is currently underway.
Greens Forestry spokesperson Kim Booth MP said that additional to the serious financial management issues identified in the Report, serious concerns were also raised by the Committee over the difficulty to obtain necessary and reliable information from Forestry Tasmania, which corroborates the experience found by Signatories to the Forests Principles process.
“The Legislative Council Committee Report strips some of the gloss from Forestry Tasmania and instead reveals a picture of an obstructive and disingenuous GBE that ducks and weaves to distort or prevent the release of requested information,” Mr Booth said.
“In this regard, reading this Report was a case of déjà vu. These serious concerns raised by the Parliamentary Committee members in effect corroborate the complaints of the environmental organisations involved in the Forests Principles process of deliberate non-compliance and obstructionism by Forestry.”
“For months the eNGOs raised formal concerns over Forestry’s failure to provide data in a timely manner, as well as its obfuscation over information, and partial release of requested data.”
“If the Legislative Council Committee is reporting a similar unsatisfactory experience with Forestry Tasmania as some Forest Principles Signatories, it must surely trigger serious action to bring this rogue agency under control.”
“The first step is to ensure that this Parliamentary Report is formally submitted to the independent Strategic Review of Forestry Tasmania currently underway, for its urgent consideration in light of any potential recommendations the consultants may be considering regarding the future governance structure of this GBE.”
“The Greens have long been on the public record with our concerns over the appalling financial record of this GBE, and in that regard the findings of this Upper House Committee are not surprising. This Report adds to the growing calls for this rogue agency to be held to account for its true social, ecological and economic cost inflicted upon the Tasmanian community,” Mr Booth said.
Excerpt: Executive Summary of the Inquiry into Forestry Tasmania Financial Performance, Legislative Council Government Administration Committee ‘A’, September 2011:
No 19 From the outset of the Inquiry, the Committee found it a difficult task to obtain clear answers from Forestry Tasmania in relation to a range of questions put to them. They were reluctant to answer questions and provide appropriate documentation as expected.
No. 20. Forestry Tasmania provided incremental information to the Committee, only after multiple requests to do so. In general terms, the Committee found that the majority of the information sought was straight forward financial information that would already have been readily available to them.
No.21. During the course of their evidence, the Committee also noted a tendency on the part of Forestry Tasmania to present a conflicting position in relation to whether they sought to be treated as a commercial enterprise or not.
