Beggaring belief

The Tasmanian Greens today said that Forestry Tasmania should be scrapped, following the Auditor General’s revelations that the government business enterprise has sought and received Ministerial assurances of more public money.

Greens Forestry spokesperson Kim Booth said the report showed that Forestry Tasmania would be unable to survive without robbing at least another $20 million from the public purse to fund its losing operations.

Mr Booth said that it was lunacy for Forestry Tasmania to increase its borrowings in the current market environment, especially after it lost another $128.794 million last financial year, leaving it without any capacity repay its debts.

“Forestry is continuing to cry poor, using the Forests Intergovernmental Agreement and the Strategic Review to justify its disgraceful financial management and its continued dependence on public handouts,” Mr Booth said.

“The claim that the IGA is creating ‘uncertainty’ is just rubbish. This situation has been created by a collapse in demand exacerbated by Forestry Tasmania’s failure to wake up to the realities of the timber market.”

“Forestry presides over a massive publicly owned resource, some globally unique ecosystems and a store of sequestered carbon which should be a gold mine in a low carbon economy. It is not only squandering this resource, it is selling it at a loss.”

“Forestry’s complete lack of business sense is breathtaking. It has failed to convert what are challenging but perfectly predictable market environments into opportunities.”

“This is a failed enterprise, and if it weren’t for the State Government continuing to write its cheques it would have been declared insolvent and placed into liquidation years ago.”

“Forestry Tasmania is clearly positioning itself to receive more public money, but the State Budget can no longer afford to support this GBE.”

The report shows:

• There was a total comprehensive loss this year of $128,794 million.
• The GBE’s cash position deteriorated from a low $29.546 million at 30 June 2010 to $9.348 million at 30 June 2011.
• Forestry Tasmania plans to borrow up to $20 million to “fund operations and capital works”. (p. 38)

Link: Auditor-General’s Report on the Financial Statements of State entities
http://www.audit.tas.gov.au/publications/reports/report2/pdfs/2011agrv3.pdf

Bryan Green, Minister for Energy and Resources: Forestry Tasmania Integral to Timber Industry’s Future

Media Release, Tuesday, 29 November 2011

The Minister for Energy and Resources Bryan Green said today Forestry Tasmania is an important part of the State’s timber industry and a strategic review of the business will help ensure it adapts to future challenges.

“Forestry Tasmania has not been immune to the affects of changes in global markets and the review is examining the future structures, governance and business models under which it operates,” Mr Green said.

“Tasmania’s forest industry is a very important contributor to our economy and the many communities that rely on it.

“The forestry industry has created billions of dollars of wealth for Tasmania over its long history and it employs thousands of people directly and indirectly.

Mr Green said Forestry Tasmania is crucial to the ongoing operations of family-owned sawmills and veneer mills.

“FT is an integral part of our timber industry and as it adapts to changes in world markets the business must also look to the future.

“While some changes to the business model may be needed to accommodate the external business environment, the Government wants to ensure that it retains the professional knowledge and expertise that exists in Forestry Tasmania,” Mr Green said.

Last week on Tasmanian Times, John Lawrence:
• Barbara Etter, we need you
• How Labor pinched IGA funds for Forestry Tasmania