Tan Ann Tasmania, through the agency of its CEO, is trying to orchestrate a similar publicly-funded compensation buy-back as Gunns Ltd managed in 2011.
With no FSC certification for their wood products there can be no markets. If there are no forward sales to customers in Japan effectively it will mean their two peeler mills and their wood supply contracts [valid to 2027] are Ta Ann’s only saleable commodities.
Mr Evan Rolley, the now CEO for Ta Ann Tasmania, appeared before the Legislative Council committee on their final afternoon or public hearings [28 February 2013].
[b]Evan Rolley[/b]: “We put on record to this Committee today the appreciation of the Board of Ta Ann for the very considerable financial and moral encouragement that was given to the company to remain and await the deliberations of this Committee. I put on record the Board’s appreciation for the very considerable measures Forestry Tasmania and its Chairman [Bob Annells], for example, took to remove the take-or-pay provisions of our contract and provide a new framework at reduced volumes for us to operate that relationship; the significant work the Tasmanian State Government did to deal with the new wood infrastructure and the costs of our electricity supply to the Huon mill, the Australian Government’s commitment to immediately commence the process of negotiation on the compensation question so we could inform our shareholders and the parent board that that matter was now in hand and there was a commitment to it, and the support the unions provided for a negotiation around our EBA [Enterprise Bargaining Agreements] terms with our employees, which saw us have to push out an extra four weeks of shutdown in operations.
Reference: Parliamentary Hansard – Legislative Council Select Committee on the Tasmanian Forest Agreement Bill 2012 – Transcripts: Thursday 28 February 2013 – Hobart – Afternoon Session http://www.parliament.tas.gov.au/CTEE/Council/Transcripts/28%20February%202013%20-%20Hobart%20-%20afternoon%20session.pdf]
Ta Ann’s negotiated take-or-pay provisions in their contracts for access to the public forests were prepared and signed whilst Mr Rolley was CEO of Forestry Tasmania. Under specific clauses these contracts can be cashed in under [i]Force Majeure[/i] provisions.
Such clauses allow Ta Ann to negotiate for compensation if they have to retire a quantity of wood supply in their existing contracts, as identified in the Tasmanian Forest Agreement 2012 bill. Gunns Ltd [i]pas-de-deux[/i] with Forestry Tasmania over long-standing debts during the IGA process saw Gunns Ltd surrendering its wood supply contracts and both Gunns and Forestry Tasmania receiving $34.5 million in compensation funds courtesy of the Commonwealth Government.
Liberal MHA, Peter Gutwein’s [i]Right to Information [/i]documents received in late September 2011 reveal that Gunns Ltd argued for sympathy from their creditor, Forestry Tasmania, because their markets for woodchips had disappeared because of competition pressures and the lack of FSC certification.
The business of Messrs Harriss and Rolley to secure even larger tranches of public funds this time for Ta Ann will be more difficult now that this commercial mechanism and its conflict of interest are now been made public.
[i]Giddings knew Gunns was insolvent[/i] by [b]John Lawrence[/b]
http://oldtt.pixelkey.biz/index.php?/weblog/article/giddings-knew-gunns-was-insolvent/
[i]Contracts and Collusion: The Underbelly of Forestry Tasmania[/i] by [b]John Hawkins[/b]
http://oldtt.pixelkey.biz/index.php?/weblog/article/Contracts-and-Collusion-The-Underbelly-of-Forestry-Tasmania/
[i]The Underbelly of Forestry Tasmania[/i] by[b] John Hawkins[/b]
http://oldtt.pixelkey.biz/index.php?/weblog/article/underbelly-part-ii/
Claire Gilmour
March 10, 2013 at 11:19
Add to that, the currently (politically) touted 100 + million ‘restructure’ of FT/forest industry suggests a new mode of on the ground/in the forests, and profitable practices. However, it is, as always was, just another avenue for FT management and co to shuffle community money from one sock draw to the next. Trying to hide the thread of largesse is the name of Gov/FT’s community service obligations …
“Conclusion
8 The most effective and least disruptive manner in which to respond to the current difficulties facing FT would be to make a CSO payment to FT. The URS report seems to quantify the community service activity of FT at between $17mil to $19 mil annually.
9 In the alternate if point 8 is not acceptable the non production forests only should be transferred to a government agency with that agency entering into a long term management agreement with FT. That agreement should provide for an annual payment of 17 mil for the performance of forest management and Community Service Obligations (CSO).â€
http://www.adrianataylor.com/sites/adrianataylor.com/files/userfiles/AWU Response to URS Report 28 Sept 2012.pdf
The heads of the industry and their political players don’t care the how or where for of the money pit, just as long as they can manipulate it.
Claire Gilmour
March 10, 2013 at 11:22
In addition,
“Mr Mulder also wants to make permanent protection for forests dependent on securing Forest Stewardship Council certification for the native logging industry.
The agreement states environment groups will “actively support†FSC certification for remaining logging, seen as a key to restoring overseas markets for Tasmanian wood products.â€
http://www.examiner.com.au/story/1354752/wood-supply-move-threatens-forestry-deal/?cs=95
As yet, neither the original agreement (IGA) or L.C have bothered looking into any detail about decent changes to forestry practices on the ground, let alone the corrupting processes behind the scenes. How will certification happen without proof of better management? Or does Mr Mulder believe the enviro groups will compromise their integrity and say something which is not true?
Then again as the Examiner article goes on to say … “Mr Mulder said there was still a risk the Forest Stewardship Council would not grant certificationâ€. So I’d suggest it’s just another sweetner, a ploy to get the money signed off on; keep on keeping on bad practices in the states available native forests; and (deceptively) helping Ta Ann look like a good corporate citizen.
They dig a hole, chuck the money in, put a lid indeed trap door on it, and then on the chorus carousel sing … Supercalifragilisticexpialidocious – which in this case means -Super callous, atrocious, fraudulently expedient, lidded deviousness – take the money, run, give and tell you nothing.
Which even backwards – suoicolaipxitsiligarfilacrepus – socially suicidal, suspects/expects its illegal, as gov guarantee to fill their pockets, creeps in … again.
Unless something drastically changes, there’s little to look forward to other than more broadway style theatre from our government.
More chimney sweeps please …!
http://www.youtube.com/watch?v=qkHV6THFoDs
Karl Stevens
March 10, 2013 at 11:32
Thanks David for informing us Ta An are angling for compensation from the taxpayer. Interesting that Lara is paying Ta Ann’s electricity bill. The Sarawak gang have form on this. Ta Ann’s owner Hamid Sepawi is the Sarawak Chief Ministers cousin. The Chief Minister ‘steals’ electricity for his mansion from the state he governs by by-passing the electricity meter. Read all about it on Sarawak Report:
http://www.sarawakreport.org/2011/03/taib-steals-his-electricity-exclusive-expose/
Frank Strie
March 10, 2013 at 12:30
Re: Pic: of Evan Rolley
These were the days of “Eucalypt Tasmania”, just look at the spin!
All colour matched for the audience.
Here parts of the Interview
http://www.abc.net.au/4corners/content/2004/s1132891.htm
Reporter Ticky Fullerton interviews Evan Rolley, the managing director of Forestry Tasmania.
Date: 16/02/2004
…
TICKY FULLERTON: What does it mean today to have the State Forestry corporatised and what’s your responsibility?
EVAN ROLLEY: Well I think the parliament decided to corporatise the old Forestry Department and the main reason was to separate out all the regulatory functions, to separate all the community service relationships, particularly with private forests and to try and give forestry on state forests a more commercial focus. Bearing in mind it couldn’t be fully privatised because the parliament wanted to retain certain legislative controls over the way the forests are managed.
TICKY FULLERTON: So it’s now operated as a business to make money?
EVAN ROLLEY: Well it’s operated with a very clear requirement from the parliament to optimise the returns while maintaining the range of non-wood values. That’s what the legislation says precisely so we can’t simply go out there and make the biggest possible profit. We’ve got to optimise returns and maintain non-wood values.
TICKY FULLERTON: Is what Forestry Tasmania is doing sustainable?
EVAN ROLLEY: Absolutely and … we’re managing a forests on a long term, sustainable basis. Now that doesn’t produce the biggest profit but it does retain the jobs in Tasmanian veneer and sawmills and the parliament has seen that as being a more important priority for long term sustainability.
TICKY FULLERTON: And what do you mean by “sustainable”?
EVAN ROLLEY: Well by sustainable I mean that you ensure that every hectare of forest that’s been harvested is replanted back to forest. What I mean by “sustainable” is that the next generation has an opportunity to make informed decisions about how forests might be managed and what I mean by sustainable is that all the non-wood values are put into a proper, a valuation before any timber harvesting occurs.
…
TICKY FULLERTON: There are some people who would say you’re not replacing forests with forests. Plantations are not forests.
EVAN ROLLEY: Well 95 per cent of what we do of course is replacing the same eucalyptus seeds on the sites with the same forests that if you go back and look at them in 70, 80, 90 years which is when they’d be planned for harvesting, they will be that rich diversity of native forest.
TICKY FULLERTON: So 95 per cent of what you replant…
EVAN ROLLEY: Yeah we’re looking to retain around 95 per cent of public native forests as native forests forever. …
TICKY FULLERTON: Just for my clarification, what percentage of the trees that have been harvested by Forestry Tasmania are replanted as natives?
EVAN ROLLEY: Well the majority are replanted as native forests. I mean that is the whole basis of our program. We’ve got an area program for plantations and as I said to you that’s a requirement of the Commonwealth and State governments that we plant 20,000 hectares of plantations. To make up for the 400,000 hectares added to conservation reserves. …
Karl Stevens
March 10, 2013 at 16:39
Knowing what we now know, why was an electricity meter ever installed at the Ta Ann Huonville site at all?
That proves how much they love red tape. Hydro sends the bill to Evan, he forwards it to Lara, she pays it and sends Evan the receipt.
Why weren’t Ta Ann given free electricity into perpetuity given the critical diplomatic importance of Sarawak to Tasmania?
john hayward
March 10, 2013 at 22:34
I’m curious as to what “non-wood values” were being served by FT’s Heads of Agreement to the Wood Supply agreement with Gunns, particularly s.7.
Normally, such agreements are made by totally defeated armies dealing with the victor.
John Hayward
Robin Halton
March 11, 2013 at 00:04
#4 Karl, I think that Rolley is fibbing to Ms Fullerton.
It would be difficult for FT and Rolley to prove sustainability of regrowth harvest even at the reviewed figure of 185,000M3pa and apply for FSC!
I do hope that Leg Co can draw some reality from the currnet Ta Ann deal. The wiser members should ask FT based on their data, a list of coupes, volumes linked potential regrowth forest types and forecasted yields for the duration of the Ta Ann State Forest contacts till 2027.
Link the peeler log information to regrowth to be EXCLUSIVELY RESERVED for a build up of sawlog material to come on stream, staged over 90 year cycles.
FT should be able to provide that information in order to forecast sustainability !
FSC could be approved only if the current rate of native forest regrowth harvest is actually sustainable! That is the big question!
Another way would be to incorporate a gradual move into plantation not forgetting Ta Ann max billet size is up to 70 cm, to takr pressure off the regrowth resource.
It seems to me that Rolley is only interested in the easy money to escape the responsiblities of harvesting in Tasmania’s public forests.
Under no circumstances should Leg Co award Ta Ann any form of compensation payout.
When Ta Ann were first invited to set up in Tasmania there was an intention to use plantation wood as well as native forest regrowth,
Both Bob Gordon and Evan Rolley would have been aware of this committment!
Frank Strie
March 11, 2013 at 09:27
#7 Robin Halton…” Both Bob Gordon and Evan Rolley would have been aware of this committment!”
It would be great if it was not so serious!
In the past both Bob Gordon and Evan Rolley would have been aware of the committment, and their close mates in the IFA, the ANU, and at University of Melbourne would “have been” ones aware of what sustainable development is about.
I say shame, shame, shame for hiding behind the political process every time the question was made about the serious consequences of each and every political deal.
Frankly, this is sickening stuff and I call it what it is: white collar crime if there ever was some!
Intergenerational theft.
But Evan refuses to wear shirts with a collar so he my think that he can get away with this spin.
There will not be a special version of FSC Tasmania or FSC Victoria if that is what the ENGOs and the Industry promoters try to make you believe.
The story continues and believe me, the world is watching, reading and listening including FSC International stakeholders.
David Obendorf
March 11, 2013 at 10:57
Robin Halton is highlighting the deceptive linkages under which this Tasmanian Forest Agreement bill has been fabricated.
Robin correctly highlights the need to identify the log resource for [b]any[/b] wood product manufacturer in this state to the specifications required for their foward contracts.
The public forests set aside for 70-90 year harvesting for premium quality peeler grades at the rate of ~165,000 cubic metres per annum (as per Ta Ann’s forward contract) needs to be identified.
Has that [i]sustainable[/i] 70-90 year projection planning been done? Where are those trees?
And what happens if a portion of those valuable maturing production forests are incinerated in a mega-fire?
john hayward
March 11, 2013 at 17:05
Why strive for the maximum sustainable harvest when the best you will get is severe damage to water catchments, topsoil, and roads combined with negligible or negative financial returns to the general economy?
John Hayward
Robin Halton
March 12, 2013 at 01:36
Rolley is wearing out his wardrobe of disguises: Nitens for sawlogs, regrowth for peelers, patting the ENGO’s on the back with support for a significant catchment of reserves and Ta Ann’s access to the Federal government’s piggy bank.
At the same time Mr Rolley has shown no care at all for the local sawmillers and access to Specialty timbers resource.
Mr Rolley has known for at least two decades with the ascendency of the Greens that harvest of native timbers for an export would be difficult with Markets for Change wielding the FSC stick at the former chipwood industry, it was obvious Ta Ann would be next.
Perhaps had the harvest of regrowth had been on a sustainable basis for local milling and peeling for laminate export then FSC could be applied with some confidence.
Rolley has gambled with both FT and Ta Ann and now expects a $40M handout for his past mistakes.
Rolley has effectively tried to roll the Tasmanian forest industry, the ENGO’s, the State government and Federal government into submission, attempting to make them to pay for his blunders.
FT can continue to harvest native forest for local use without FSC approval however it needs to look harder at better managing its overall resource harvest as Nitens plantations are unlikely to ever produce any sawlog until after the mid century.
David Obendorf
March 12, 2013 at 11:38
Robin Halton [comment #11] identifies the range of deceptions and spin that underpin this flawed Tasmanian Forest Agreement process.
Various groups holding out countering the ENGO roll-over to bolster Ta Ann’s customer-base has been exposed.
The Legislative Council needs to significantly modify this bill and if the Government is not agreeable it should be rejected.
The process has been fraught from the beginnings with the McKim-Bartlett accord in 2010. The ENGOs were duplicitous in their negotriations and showed the same untrustworthness that we came o expect from the forestry interest groups.
The process was treated as an Magic Pudding – a never-ending [i]’cut & come again’ cake[/i].
How did the ENGO-bureaucrats all let it come to this?
William Boeder
March 12, 2013 at 13:34
#12. David I would suggest that this ENGO business was accomplished by the usual industry pledge as is their standard industry guarantee that has forever been issued to each and all, that being the logging industry known expedient of proffering their usual quantum of false promises.
It’s hard to understand just how many gullible persons and ENGO heavy-weights their actually are in the State of Tasmania.
Robin Halton
March 13, 2013 at 07:10
The State government under Premier Giddings have failed to deal with the current Tas Forest Agreement Bill by passing it in the Lower House without a responsibile approach towards taxpayer funding an international timber processor for the tune of $40M!
The ENGO’s and the Greens support the same process.
$40M would go along way towards badly needed educational and continued health support for the state and not to be gifted to some Malaysian company who is showing no genuine interest in Tasmania’s forest transitional crisis!
I am hopeful that Leg Co will take a stronger view after their analysis.
Of cause I would be pleased if the Premier and her two Green partners are left red faced for their initial mishandling of the TFA, serve them right.
David Obendorf
March 13, 2013 at 10:26
If the lessons of throwing taxpayer funds at the big wood-product manufacturers has nor sunk in yet… maybe the politicians and treasury officials need to refer to other historical cases in Tasmania where millions were passed over to companies like Australian Paper to purchase state-of-the-art new machinery to maintain cost-competitiveness globally only for their Tasmanian businesses to be sold off and those specific pieces of newer equipment sold as company assets to overseas buyers.
Maybe that is an accepted form of money laundering in Tasmania.
I understood that Ta Ann’s expensive rotary peeler machinery at Smithton and Huon were also financed out of John Howard’s Commonwealth contributions to supporting forestry jobs under the Tasmanian RFA he signed in 1997. Please correct me if I am in error.