I have investigated the Tasmanian Community Forest Agreement (TCFA) signed on the 13th May 2005 between the Tasmanian and Australian Governments.
This extraordinary document commits both Governments to “revitalise the Tasmanian timber industry and preserve old/growth forests,” by an expenditure in total of $250 million dollars. I was alerted to this by the Cash Flow Statement in the end of year financial report of Forestry Tasmania for the year 2009. This shows inflows from the TCFA for the year 2009 of $41,792,000. This cash injection gave Forestry Tasmania the ability to state that the end of financial year they had $37 million in cash in the bank. It should be noted that their main occupation, the forestry business, generated sales of $150 million dollars, which after expenses, produced a net cash flow of $3.3 million dollars. How vital therefore is a net cash inflow from the Government’s of $42 million dollars.
I quote from the notes to the financial report on page 6 under sales revenue, sale of goods: “the point at which revenue is recognised for products sold within the state is considered to be either when the timber is loaded at the landing or delivered to the mill door. Export sales are recognised when the ship departs port.” I ask, does this mean that the wood chips currently lying unsold at the three export ports in Tasmania, now under the control of Gunns, were considered to be “an export sale” if so they are in fact the property of Forestry Tasmania and all Gunns does is flick them a bill when the chips leave port. Perhaps Forestry Tasmania would like to clarify this issue.
On one hand if Gunns own them and they cannot pay Forestry Tasmania no wonder Aird is scrambling. If FT owns them with $3.3 million dollars in cash flow for a year they must be really squealing; this would explain why Aird and Gordon are running around the world looking for cash buyers for the unsaleable non FSC accredited wood chip piles.
The terms on which the $20 million dollars owed by Gunns to Forestry Tasmania were originally granted is of interest, was it 30 days that crept out to 60 days and is it now 90 days and beyond. If so it could be suggested that it is the State and Federal Governments cash flow injected through the TCFA which is keeping Gunns afloat.
Perhaps John Gay and Tasmania’s Lib/Lab Party, all of whom are going to blame the Greens and not FSC Certification for this debacle, would care to comment.
The Hangman’s Noose has dropped, however Gunns neck appears as yet unbroken, but I suggest that slow but steady strangulation is now taking place.
