Tasmanian Times


Forestry Tasmania’s final report: The Billion Dollar Loss

*Pic: Matt Newton, http://www.matthewnewton.com.au/

First published November 9

A survey of the wreckage left behind by Forestry Tasmania (FT) reveals since its peak in 2004 it has lost over $1 billion from forestry activities.

During that time cash outlays were $440 million more than trading revenue and the value of the forest estate fell by over $600 million. Add the two figures together give the aggregate loss over the past 13 years of $1 billion. Equal to $40 for each tonne harvested.

Spending on plantations ($106 million), property and plant ($33 million) and roads ($105 million) added nothing to FT’s asset base. Together with the continual losses from forest harvesting meant FT’s cash losses totalled $440 million over the last 13 years.

Then there are non-cash losses, often called book losses, principally the fall in the value of the forest estate. This has occurred because a lot of trees have been chopped down and sold and because as maintenance and harvest costs rise faster than prices for forest products then the value of remaining forests consequently falls. Over the past 13 years the value of FT’s forests has fallen by over $600 million. Trees entrusted to FT are now worth a fraction of their former value.

So how did FT cover its cash losses? …

Read more here on the Tasfintalk website

*John Lawrence worked as an economist, public accountant and a DIY Super consultant. Currently a public policy researcher and blogger. Am interested in promoting an understanding of finance and economic issues particularly those that confront the State of Tasmania. (Published in The Mercury on 9th November. A longer version reviewing the demise of FT will be posted in a few days). Mercury: Billion-dollar loss shows forestry finances need overhaul

ABC: Government rejects claim that waste log export operation is ‘rorting’ federal subsidy

• Gordon Bradbury in Comments: When the forest industry is already the most heavily subsidised industry in Tasmania, Andrew Wilkie is spot on: ABC: Government rejects claim that waste log export operation is ‘rorting’ federal subsidy. It is the taxpayer who is being rorted. Job creation? What rubbish! Centrelink timbers in the sheltered workshop … that is the forest industry.

Author Credits: [show_post_categories parent="no" parentcategory="writers" show = "category" hyperlink="yes"]


  1. Robin Charles Halton

    November 15, 2017 at 12:56 am

    #26 Mike Seabrook,
    James Neville Smith’s plan to truck forest
    “residues” arriving at then from from Southwood and other pick up points along the route of linked forestry roads to the west and south west of Geeveston to an export loading point at Strathblane on Esperance Bay sounds an exciting prospect!

    I will be examining the plan closely as more information becomes available with a positive

    I say give the project space as it sounds far better than barging wood products from Waterloo into bulk carriers at anchor at the mouth of the Huon River.

  2. mike seabrook

    November 14, 2017 at 8:42 pm

    the southern export of woodchips residues will fix that

    lots of jobs for wwf members in loading the woodchip barges and in transfer those wood chips to ships in the huon river/channel

    lots of jobs for australian seamen in manning the ships in tasmanian/australian waters

    paid for by transferring the present ongoing subsidy cost in trucking woodchips north for the next will it be 50m years

  3. Gordon Bradbury

    November 13, 2017 at 10:15 am

    Tasmania needs a transition strategy out of public native forestry, with say a 10 year horizon.

    And it needs the support of the majority of Tasmanians so that it doesn’t become a political football.

    A new forest policy is needed that focuses on farm forestry and profitable tree growing.

    The new policy needs to be driven by the TFGA and PFT.

    It is well and truly time to end the Tasmanian forestry madness.

  4. Todd Walsh

    November 11, 2017 at 4:47 pm

    Funny how people like My Johnny Howard keep ridiculing those on the other side of the fence. The absolute blind loyalty in the face of the bleeding obvious is usually something to admire. Unfortunately, there is no admiration for those who trumpet the destruction of our bush for no more than pocket linings for the rich and powerful.

    The sad reality is that forest subsidies to leave the bush intact would have made much better economic sense. The end result could have seen Tasmania as a true, last wilderness destination, rather than a monarchy of incompetence with the starving peasants rallying to the king. Shame on us, unfortunately.

  5. Russell

    November 11, 2017 at 10:11 am

    Re #12
    They’ve been doing it for over three decades, so I guess the answer to your question is “on public subsidies.”

    Re #13
    I don’t know where you live, most likely not in Tasmania, because the native forests they logged have been turned into plantations. Go for a drive around Tasmania and witness it for yourself. You’ll have to look past the thin roadside strip of gums and myrtles though.

    Re #16
    “What have MIS’s got to do with STT’s losses anyway ?”

    They’re one and the same. Put lipstick on a pig and it’s still a pig.

    Re #18

    Landowners who were sucked into converting their land lost and are now pulling up the mess this MIS caused.

    “loggers, cartage contractors, service personnel, tree planters, company staff (whatever that is), airlines (???? – please explain!), catering companies (???? – please explain!), local newspapers (???? – please explain!), car companies (supplying FT’s shiny new vehicles every couple of years) and of course, the finance industry etc” were and are still the most expensive bunch of professional welfare recipients Tasmania has ever known.

    It’s the government’s funds to spend however WE like!

  6. spikey

    November 10, 2017 at 1:21 pm

    #13 … lol

    squark squark splatter splatter

    (bonus gibbon points for inferring its all the bloody greens fault)

  7. spikey

    November 10, 2017 at 1:16 pm

    #18 … pmsl

    that desperate bullshit was so funny i’m thinking about getting it tattooed on my butt


  8. Mike Bolan

    November 10, 2017 at 12:59 pm

    #18 … Interesting.

    You are arguing for absolute rule by the government without reference to meeting taxpayers’ needs/wants. That is not democracy as I understand it. The idea that some group can declare ‘terra nullius’ and then claim to legally own the land is an early example of the kind of domination that governments operating in the manner you define. We aren’t going to agree on this because I totally reject that model.

    In a democracy, stability and success is achieved through the people having a real say in their own affairs and how their money is to be used, not just at election time. That helps ensure that the system is geared to meeting the needs/wants of its members.

    If the government owns and controls everything then that won’t happen. Instead. governments become autocratic and corrupt and then the people lose their respect for government and ultimately collapse (e.g. revolution) or chaotic failure occurs. Perhaps that’s what we’re seeing?

  9. Tim Thorne

    November 10, 2017 at 12:20 pm

    Being taxed and then having no say in how that money is spent seems to describe a situation such as that which led to the American War of Independence, not to mention hundreds of other violent attempts to increase the element of democracy in government over the centuries.

    MjF in comment #18 no doubt sees these attempts as wrongheaded.

    If the money was raised from taxation it is perfectly accurate to call it “taxpayers’ money” when it is being spent.

    Money is never “lost”, merely redistributed. The important issue is the nature of that redistribution.

  10. MjF

    November 9, 2017 at 11:26 pm

    #17 … Incorrect.

    In the MIS case, the community didn’t all lose.

    Examples of winners were landowners who sold land, agents who made the sales, numerous contractors performing a range of activities, landowners who leased land, nursery owners, loggers, cartage contractors, service personnel, fencing contractors, tree planters, company staff, airlines, catering companies, local newspapers, car companies and of course, the finance industry etc. These people are all members of communities.

    Personally my view is that after I pay my taxes, that money belongs to the government. It ceases to be taxpayers’ money at the point the taxpayer hands it over. So to bang on about taxpayers (public) money is rubbish. You the donor have no say. It’s the governments money to spend however they like.

    Make your point by all means, try keeping it factual.

  11. Mike Bolan

    November 9, 2017 at 8:50 pm

    #16 … The point I was making was that forestry didn’t lose any money … they put into their pockets and those of their partners. It was the public that lost money. MIS investors similarly lost money. So in all cases it was the community that lost … money, public forests, roads, upkeep costs and so on. Anyway, thanks for the opportunity to say it again.

  12. MjF

    November 9, 2017 at 6:32 pm

    I do know MIS investors typically spent annual pre-tax earnings in buying woodlots to reduce taxable income, as sanctioned by the individual ATO product rulings. Plenty even took internally offered finance to get in on the action rather than spending their own money. Tax deductible interest + other holding costs.

    And then defaults on payments. Promoter resumes the juvenile woodlot(s) but has no repayments to help cashflow. They then sells loan book for a fraction of its worth for some cash injection.

    I didn’t know there were ‘thousands’ that invested their life savings. I doubt the truth of that statement.

    That would be a very foolish thing to do by anyone, regardless of investment type.

    Accountants did not receive percentages. They were generally either employed as hourly hire or on salary.

    Financial advisors received a percentage of the gross sales back from promoters resulting from their recommendations. These guys were the winners in every sense.

    I don’t use financial advisors.

    What have MIS’s got to do with STT’s losses anyway ?

  13. Mike Bolan

    November 9, 2017 at 11:24 am

    Interesting the false impression our accounting language leaves.

    As far as I see it, forestry didn’t lose the millions – they received them! It was taxpayers who ‘lost’ the millions and lost the resources that were variously cut down, chipped, torched and otherwise removed from public access. And we shouldn’t forget the thousands of MIS ‘investors’ who lost their life savings because they believed the government (Erica etc) and percentage receiving accountants and ‘advisors’ who ‘recommended’ MIS to them.

    That forestry ‘lost’ is merely accountant speak. In the whole debacle of Tas forestry, it was the forestry interests that got the cash, taxpayers who lost the money, and various supposed ‘greenies’ who got the blame.

  14. MjF

    November 9, 2017 at 10:53 am

    What are you up to these days spud ?
    Oh, I see, the woodworker. Don’t know the gentleman. They say he’s very skilful.

  15. John Tacey

    November 9, 2017 at 10:25 am

    Another typical misrepresentation of the facts about the forest industry. Those who think plantations are superior to native forests have been completely misled.
    Plantations are monoculture and by using herbicides and pesticides the land is killed. We don’t have to worry about destroying flora and fauna in plantations as it doesn’t exist. Native forest harvesting is not monoculture, uses no pesticides or herbicides, and its return to native forest mimics natural processes. Green propaganda has made us think that plantations rule … Instead they are killing us all.

  16. Wining Pom

    November 9, 2017 at 12:05 am

    How can they clearfell for forest residue?

  17. spikey

    November 8, 2017 at 10:57 pm

    blah blah blah
    it’s all the bloody lying greens fault
    if they hadn’t locked up all gunns and ta anns forests
    the dickheads entrusted with our public resources
    could have lost more money
    and planted more firebomb shit

  18. Gordon Bradbury

    November 8, 2017 at 9:50 pm

    When the forest industry is already the most heavily subsidised industry in Tasmania, Andrew Wilkie is spot on:


    It is the taxpayer who is being rorted.

    Job creation? What rubbish!!

    Centrelink timbers in the sheltered workshop that is the forest industry.

  19. John Powell

    November 8, 2017 at 8:38 pm

    Martin #3 you don’t know George Harris aka Woodworker? suspect @ShTiT aka @forestrytasmnia should cease your consultancy

  20. Gordon Bradbury

    November 8, 2017 at 7:55 pm

    John Lawrence answered my call. Thankyou John!

    With this analysis from John, plus that from Graeme Wells:


    We can all do some serious damage this coming State election; damage to the Liberals, to Labor and most of all to the forest industry.

    No more subsidies?

    How about no more public native forestry??

  21. john hayward

    November 8, 2017 at 7:53 pm

    Losing $1b over 13 years selling a public natural asset for which you have paid nothing requires either super-human stupidity or a managerial kleptocracy combined with a staggering and sustained level of public gullibility.

    I’m presuming that FT and their descendants finally desisted from claiming ownership of State Forest Crown land, as they formerly did, and now content themselves with jeering at their old victims.

    John Hayward

  22. spikey

    November 8, 2017 at 7:52 pm

    #3 … was that a variation of the harriss defence?


  23. Teresa Maddox

    November 8, 2017 at 7:40 pm

    …….and people go on about welfare recipients being a drain on the taxpayer! Ha!

  24. Ted Mead

    November 8, 2017 at 7:33 pm

    Thanks John, for the great analysis/number-crunching. Of course there are no real surprises beyond what every Forestry critic has been postulating for some time.

    These statements from you are very significant because it is easy for governments to dismiss numbers from conservationists, but impossible for them to do so from a credible economist!

    Depressing as the figures are, they are now out there so the public can no longer say they don’t know, they can only say they don’t care !!!!!!!!

    # 3 – haha – who’s the predictable one?

  25. mJf

    November 8, 2017 at 6:49 pm

    @2 powell LOL

    Personally I’m waiting for a mead expose. Expecting it to contain the classics i.e. neanderthal, cave, troglodyte, slither, rocks, primordial slime, morons, devastation, renewables and the…………..p- word.

    Maybe even multiple !!!!!!!!’s to conclude matters.

    Who’s Aka ?

  26. John Powell

    November 8, 2017 at 2:55 pm

    Just cannot wait for the erudite comments of support from RCH, MjF, MP, and AKA = not to mention TGC. What a great resume of the pathetic management of FT and successive governments!

    But $161 million in 3 years @willhodgman ? #Wreckingyourfuture

  27. Chris

    November 8, 2017 at 1:34 pm

    Whats wrong wiv them, My friend, a farmer purchased back many many many acres of plantations on his land for the sum of one dollar.

    John Gaye did not spend one cent towards this transaction.

    We still travel on the East Coast highway, upgraded no doubt to service Triabunna, good road but I think it was refurbished, like many others, at taxpayer expense and the cost hidden in other budget items.
    Corrupt or misleading?

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