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End Forestry Subsidies


Kim Booth

Kim Booth  -  Wednesday, 28 May 2014

Tags: Forestry Tasmania, Subsidies

The Hodgman government’s failure to vote to require Forestry Tasmania to move to a competitive full-cost recovery business model by the 1st of July this year, confirms fears that the taxpayer will still prop up the entity once the contingency fund is removed, Greens Leader and Forest spokesperson Kim Booth MP said today.

“Despite stating in the House a fortnight ago that ‘Forestry Tasmania will not receive any taxpayer subsidy from 1 July’, the Resources Minister Paul Harriss weasled out off a binding vote by instead moving an amendment to gut the Greens’ motion,” Mr Booth said.

“The question that Minister Harriss has repeatedly refused to answer isn’t whether Forestry’s contingency fund will cease at the end of the financial year, but how will the government prevent other forms of public-funded support being needed to prop it up.”

“The Liberals refusal to commit to requiring Forestry Tasmania to move to a competitive full-cost recovery business model by the time this particular source of cash-flow ceases, exposes their end of all public subsidies’ pledge to be a hollow sham.”

“By refusing to vote for a new industry business model, the Liberals have in fact confirmed that the taxpayer will still prop up Forestry either by increased borrowings, asset sales or equity transfers. The subsidies will continue by another name,” Mr Booth said.

Text of Greens’ motion which the Liberals amended to remove any requirement for Forestry Tasmania to move to a competitive full cost recovery business model by the 1st of July this year:

That the House:

(1) Notes that

  1. significant public subsidies have been provided to Forestry Tasmania over many years;
  2. Despite recent public statements made by the Hodgman Liberal government ruling out further public subsidies to Forestry Tasmania, further clarification over the following has not been provided:

(i) Whether the letter of comfort provided to Forestry Tasmania by a previous Treasurer has been revoked, and if not whether the current Treasurer intends to revoke it;

(ii) Whether Forestry Tasmania will no longer be able to borrow money from the Crown of any other lender;

(iii) Whether the Government will rule out forgiving Forestry Tasmania debts including unfunded superannuation liability, or transfer assets from other GBEs and state-owned companies;

  1. Further notes the intention of the Hodgman Liberal Government to allow logging of minor species timbers in conservation areas;

(2) Agrees that:

  1. The government is to ensure that all forestry logging and harvesting operations, including of minor species timber,  is to be done on a full cost-recovery basis, and that royalty rates are charged to the recipients that  reflect both the cost and a commercial margin; and
  2. Forestry Tasmania is to shift to a full cost-recovery business model on the removal of taxpayer subsidies, from 1 July 2014.