Axe VicForests or chop off the public money

Josh Gordon

The Age, May 29, 2014 

The age of entitlement is alive and well in Victoria. At least when it comes to the logging of native forests, a proposition that has become so financially fraught the government is considering getting into the business of firewood collection and chipboard production just to prop it up.

A couple of weeks ago South East Fibre Exports – the Japanese-owned company that owns a large woodchip mill at Eden – decided to dump a contract taking waste timber from VicForests’ East Gippsland logging operations.

It was seen as a body blow for the industry. As it is, harvesting sawlogs from native forests is barely viable, with international markets increasingly demanding cheaper and higher-quality plantation timber, and wood also increasingly sourced from low-cost countries, such as Vietnam. Australia's high dollar hasn't helped.

Even before the decision by South East Fibre Exports, the local sawlog industry was in strife. A December 2013 report by Victoria’s auditor-general found that last financial year at least 250,000 cubic metres of residual wood – 16 per cent of the total harvest – was left on the forest floor and burnt because no one wanted to buy it.

"It is not sold primarily because there is currently no market for it," the auditor said.
What a waste. There may no longer be a market for Victoria's "residual" native timber, but selling this unwanted byproduct is still seen as vital to make sawlogging viable.

Under the current arrangement with South East Fibre Exports – which will end next year – VicForests supplies about 200,000 cubic metres of wood to the Eden mill, equivalent to about one-sixth of the total 1.2 million cubic metres produced by VicForests in 2012-13.

The situation is so dire that VicForests is now considering the possibility of selling the residual wood from its forestry operations as firewood, producing chipboard, or using old-growth waste wood for power generation.

"There is the opportunity for local bio-energy production, but also simple markets, particularly given the increase in energy costs, [like] domestic firewood for home use," VicForests corporate affair's director Nathan Trushell told Gippsland ABC radio.

You can only wonder how a private sector firewood business might feel about the prospect of a heavily subsidised state-owned behemoth encroaching on its businesses.

Indeed, as far as socialist-style, publicly owned businesses go, VicForests is in a league of its own.
Not only has VicForests been gifted a hugely valuable public asset free of charge, it has been given monopoly rights to chop this asset down, all the while being spared massive direct and indirect costs associated with logging operations.

It is enough to make Fidel Castro blush.

These indirect costs include the $20 million annual cost of maintaining forestry roads, the opportunity cost of the water lost from our catchments, plus intangible costs such as lost biodiversity and reduced public amenity.

What does the public get in return for this bold experiment in socialism? According to an assessment of VicForests’ finances by the Australian Conservation Foundation, since 2005, VicForests has accrued operating cash flow losses of $11.9 million on its core forestry activities. Over the same period, it has notched up investment losses worth $10.2 million.

That’s a combined loss of $22.1 million from forestry activities – equivalent to about $1.50 for every square metre of timber harvested so far. As the report notes, VicForests' financial position has to a significant extent been propped up by reliance on cheap debt from the Treasury Corporation of Victoria.

In the nine annual reports since it was established, VicForests has announced just three dividend payments to taxpayers: $3 million in 2006 and $2 million in 2007 and a further $250,000 payment this financial year after a positive profit in 2012-13.

The big argument in favour of protecting the local industry is employment. As the auditor pointed out late last year, the timber industry employs more than 21,000 people, while VicForests claims native forest timber harvesting in eastern Victoria has generated about $1 billion in direct economic benefits since 2004.

Agriculture Minister Peter Walsh insists the market is "fundamentally sound" for high-quality sawlogs, claiming the challenge is to find alternative options for the residual and low-grade timber.

But at what cost? There are very real questions that need to be tackled about whether we can continue to push public resources into an industry that would surely struggle to survive on its own – particularly in an age where the public is told the age of handouts is over.

If the objective is to protect jobs, surely there are more sensible ways to do this. If the government is determined to protect Victoria’s timber industry, investing in economically viable plantation forestry might be a good start.

Already there are rumblings within Coalition ranks about the future viability of VicForests, with the issue seen as a potential pressure point between the the Liberal and National parties.

Given the predicament facing VicForests, it is not hard to see why. The debate is no longer one of ideology, it is one of basic economics.

VicForests in middle of battle over possums and timber

James Campbell

Herald Sun, 23 February 2014

IN the next few weeks the State Government will make a decision which is likely to seal the fates of leadbeater’s possums and Victoria’s native forest timber industry.

The possum, a cute critter and since 1968 Victoria’s faunal emblem, is in a bad way. No one is sure how many of them managed to survive the Black Saturday bushfires, which, according to official estimates, burned 45 per cent of the area kept for its protection and 34 per cent of its potential habitat. The State Government puts its numbers between 3750 and 11,250, which sounds dire, but is better than the earlier official estimate, which until its rediscovery in 1961 was zero.

Unfortunately for the possum, it shares its habitat with another endangered species, the native forest timber industry. Again, relying on official estimates, VicForests, the government-owned entity which manages the logging of the state’s native forests, sources 70 per cent of its annual ash timber supply from within the range of the leadbeater’s possum. More importantly, some say this area is the most — indeed some would argue only — profitable part of VicForests’ logging activities.

In other words, saving the possum is unlikely to be compatible with saving the native forest timber industry. Like the possum, the native forestry numbers have been in steep decline too.

According to Australian Bureau of Agricultural and Resource Economics and Sciences data, in the decade to 2012, annual native sawlog production fell by 45 per cent and pulp wood — the stuff that ends up in the chipper — by 30 per cent.

As for VicForests financial statements, the best that can be said for them is that they are not as bad as they used to be.

According to its latest annual report, last year it took in $104.5 million from the sales of forest products, with other income taking its revenue to $106.3m.

Alas, its expenses came to $105.3 million, meaning all up, its net profit was only $802,000 — which, while pretty dismal, is still better than the $96,000 it lost the year before.

VicForests hasn’t paid a dividend to the Victorian Treasury, i.e. the taxpayers, since 2007.

Indeed, it has only managed to pay a dividend twice since it was established in 2004. Across its eight years of existence it has reported an after-tax profit of only $12.3 million. But even that you can take with a grain of salt, as over the same period it has received government grants of $24.7 million.

Keep in mind too that VicForests can borrow money at subsidised rates from the Treasury Corporation of Victoria, whereas its private competitors, who grow trees on plantations, cannot. (Incidentally, its private competitors also have to pay for the land they grow trees on — and the council rates on that land — whereas VicForests does not.)

But as bad as these numbers are, the fact is they probably don’t reflect the true losses to the taxpayer of continuing to log native forests. For starters it doesn’t include the cost of fixing roads that logging trucks damage, nor the loss of water that disappears from dams and irrigation systems into regenerating forests after logging. Or more controversially, the cost of fighting the fires loggers sometimes start — something I predict we are likely to hear more about after this summer’s events.

Getting back to the possums, Cabinet will soon consider a report from an advisory group which includes such possum-friendly folk as the boss of the Victorian Association of Forest Industries and representatives of VicForests, established to consider ways it can be saved “while maintaining a sustainable timber industry”. The report has gone to Environment Minister Ryan Smith and Agriculture Minister Peter Walsh. What it says, we’ll have to wait and see.

Government sources say that the two men take a different view of what should be done. Smith is believed to support the creation of a Central Highlands National Park to save the possum, while Walsh is prepared to accept a small area be set aside to save the timber industry. His line of argument with his colleagues is expected to be that this is a jobs issue, which in an election year should trump other considerations. The Government claims the industry employs 2300 people, but it is unclear how many of those jobs depend entirely on native forestry, rather than a mixture of native and plantation timber. The largest employer, with 900 jobs, is the Maryvale paper plant, which has indicated in the past it would be happy to shift to chips from plantations. VicForests itself only employs 114 people.

Normally, the smart money would be on “Walshie” to get his way. The Agriculture Minister has earned a reputation for winning internal battles. In a Smith vs. Walsh fight it would be no contest. The wildcard, though, is Treasurer Michael O’Brien and his department. O’Brien is unlikely to be impressed with an industry whose subsidies are retarding the growth of the private enterprise plantation industry. The possum may yet triumph over the loggers.

james.campbell@news.com.au

Walsh should resign

Peter Campbell
Letter to the Editor (not published)

It is extraordinary that Peter Walsh as a Victorian Minister stridently supports VicForests logging publicly owned scarce remaining native forests that shelter endangered species. Neither the Victorian Government nor its ministers should be in the logging business.

When Peter Walsh attacks groups such as Environment East Gippsland (Heraldsun, 18/2/14) that take legal action when government-sanctioned logging breaks the law, he demonstrates a conflict of interest concerning the management of publicly owned forests.

Taxpayers are then hit again paying for his legal settlement for his ill-considered and inappropriate comments. Walsh should resign or be sacked.

Taxpayers foot the bill for serial bigmouth MP Peter Walsh in a second defamation settlement

MATT JOHNSTON AND JAMES CAMPBELL 
Herald Sun, 18 February 2014

SERIAL big mouth Agriculture Minister Peter Walsh has struck again leaving Victorian taxpayers to cough up for a second defamation settlement.

The latest settlement, after legal action was taken by Environment East Gippsland, will result in tens of thousands of dollars handed over because of comments made late last year.

It follows a separate case in 2012, which led to a public apology and retraction from Mr Walsh after he made comments about a group called MyEnvironment.

In total, a government source familiar with the cases said bills for both cases could be up to $100,000 once legal costs were included.

When approached about the two cases, the usually candid Mr Walsh said he could not respond to the Herald Sun, other than to say: “It would be inappropriate for me to comment on these matters.”

A lawyer for Environment East Gippsland also said they could not comment.

It is understood strict confidentiality clauses signed between Mr Walsh and the environment groups were involved in the settlements.

Opposition Scrutiny of Government spokesman Martin Pakula said the government must come clean on exactly how much taxpayer money had been spent on these cases, however.

“It’s not appropriate or acceptable for the minister to hide behind a confidentiality clause to deny taxpayers the information that they are entitled to,” he said.

The most recent offensive comments, made against Environment East Gippsland, related to legal action involving VicForests, the government-owned logging organisation.

It is understood the comments from a press release asserted that anti-forestry groups wasted taxpayer money on litigation.

It is anticipated that Mr Walsh will be issuing a formal apology, as he did after the 2012 case.

That case, in which Mr Walsh settled with MyEnvironment, was over comments he made about Supreme Court action taken by the environment group.

After the settlement Mr Walsh published an apology and retraction, saying he had “alleged that the proceeding was brought by MyEnvironment Inc in bad faith and in an attempt to exert financial pressure on forest industry workers and their families”.

“I accept that there was no basis for the allegations against MyEnvironment Inc embodied in my media release,” he said.

Mr Walsh made the comment despite conceding later that the judge had “made an express finding that the proceeding was brought in good faith and pursued in the public interest”.

A government source said Mr Walsh had clearly not learnt his lesson after the first case.

Greens MP Greg Barber said: “On top of the millions of dollars in subsidies that prop up native forest wood chipping, there’s now also the cost of getting the Minister out of his own messes.”

Knitting nannas in court over purler of a protest against logging at Mount St Leonard

Farrah Tomazin, Sunday Age's state political editor
The Sunday Age, December 1, 2013

As eight ''nannas'' face the clogged court system for knitting in a logging coupe, the price of protest in Victoria is set to escalate.

From left, Knitting Nannas Tess Hughes, Marion Lewis, Karena Goldfinch, Margaret O'Connell, Deanne Eccles and Lynn Dean. Photo: Meredith O'Shea

Fourteen months ago, six grandmothers and two grandfathers entered a logging coupe at Mount St Leonard, placed their chairs in a neat row, and quietly sat down to knit.

The group had watched for weeks as violent clashes escalated between young protesters and loggers on the mountain, 65 kilometres north-east of Melbourne. Fed up by the destruction of the forest - and fearing for the safety of those trying to protect it - the so-called Knitting Nannas of Toolangi had decided to take a stand.

"The loggers had begun doing citizens' arrests and they were getting very aggressive with some of those protesters," recalls Kerryn Blackshaw, a 66-year-old "nanna" who helped spearhead the wool-and-needles campaign. "As older women in the community, we felt we had to do something. So we walked in quietly, put our chairs in the safest place we could find, and got our knitting out."

It's hard to imagine a more civilised demonstration than a bunch of cross-stitching seniors, but as an act of defiance, it was simple and effective. For a few hours that day, the loggers stopped working and the Knitting Nannas protested peacefully. When police eventually arrived, they took a statement, escorted the group out of the forest, and no charges were laid. Or so the nannas thought.

Almost a year later, each member received a summons from the Department of Primary Industries. The offence? Carrying out an activity in a "public safety zone" - an exclusion area set up by the state government to prevent people from entering logging coupes.

Some of the nannas appeared in the Ringwood Magistrates Court last week; the others are due to defend their case in mid-December. But at a time when Victoria's court system is already under strain because of the Coalition's tough-on-crime agenda, many question why they were pursued in the first place.

"It was quite a surprise," another Knitting Nanna, Margaret O'Connell, said last week. "I just don't know what's behind it - maybe it's political or maybe we were being too effective. It just seemed like such a silly thing to pursue, so long after the event."

Whatever the motive, the price of democracy is about to get higher, with the government set to introduce new offences and penalties for people who protest in logging coupes. Once these amendments are passed by the Parliament, protesters will face new fines of $2877 for possessing prohibited objects or substances in a timber harvesting safety zone and $8661 if they are caught ''breaching an exclusion order''.

Prohibited objects include bolt cutters, cement or mortar mix, metal or timber frames and heavy steel chains.

But not knitting needles.

The same amendments will see a 20 per cent hike in maximum fines for people caught removing or destroying fences and notices in timber safety zones (each offence will now carry a top-level penalty of $8661).

Agriculture Minister Peter Walsh says the changes are designed to deter disruptions in logging coupes and improve safety. The government will preserve the right to protest, he says, "so long as the protest activities do not put anyone's safety at risk or break the law".

Others, however, are not impressed. "I think it's an assault on democracy," says 74-year-old Lorraine Leach, a grandmother of eight. "We're just there to protest quietly and show the industry that we're watching and don't approve. I've been walking these forests for 30 years and what is happening up there is shocking. If we don't take a stand, there will be nothing left."

The nannas who appeared in court on Thursday were placed on a diversion order, and only require a $50 donation to Landcare to avoid conviction. Ms Blackshaw says it was a good outcome, but admits the process was "distressing for everyone involved".

"All of us have totally clean histories yet we were treated like criminals," she said.

Vic govt declines to comment on possum extinction

Mark Colvin 
ABC PM -  14/08/2013

MARK COLVIN: Last night we ran an interview with the leading expert on Victoria's faunal emblem the Leadbeater's possum who warned of the creature's likely extinction.

Professor David Lindenmayer of the ANU draws on more than 30 years of work in the Victorian Ash forests studying the possum.

He argued among other things that a new national park was needed to protect the Leadbeater's possum, because without areas completely free of logging, it had no chance of survival.

We said then that we'd be seeking a substantial response from the Victorian government tonight.

Today, the Victorian Environment Minister, Ryan Smith, declined our invitation to appear.

He referred us to the Agriculture Minister, Peter Walsh, who was also unavailable.

PM then approached the Premier's office, but he too declined.

Mr Walsh's office suggested we talk instead to the loggers' peak body, the Victorian Association of Forest Industries.

Its Chief Executive is Lisa Marty.

LISA MARTY: Look I, I think given the impact of the 2009 bushfires, which burnt 45 per cent of the Leadbeater possum reserve area, the survival of the Leadbeater possum is a concern for many Victorians, certainly including those in the forest and wood products industry.

MARK COLVIN: You don't accept what Professor Lindenmayer says, that it's the effect of both logging and bushfires?

LISA MARTY: Look I think there's a range of challenges facing the Leadbeater possum, but overwhelmingly the impact of the 2009 bushfires has made the situation very critical. As an industry and certainly as the Victorian Association of Forest Industries we're committed to responsible forest management and to the recovery of the Leadbeater possum alongside a sustainable local forest and wood products industry.

MARK COLVIN: And critical means urgent doesn't it? I mean what's being done in the very short term?

LISA MARTY: It is about the short term future of the Leadbeater possum but it's also about the future of the possum in the long term.

David Lindenmayer's work does show that over time there are a range of challenges facing the possum; so there are both short and longer term challenges.

MARK COLVIN: But this advisory committee, this Leadbeater's Possum Advisory Group, when is that going to produce any real results?

LISA MARTY: The group has been requested to provide recommendations back to the government before the end of the year. It's quite a short timeframe but we will be drawing on the latest science, including the work of Professor Lindenmayer, as well as the outcomes of recent work by the Arthur Rylah Institute, which was commissioned by the Victorian government, last year as well as the contributions of stakeholders.

MARK COLVIN: Well he tells me that he's been writing to the government and has had really no response, is he going to have any guarantee of being properly listened to by this group?

LISA MARTY: Certainly. It is absolutely crucial that the work of respected scientists such as Professor Lindenmayer, the scientists at the Arthur Rylah Institute, forest scientists, social scientists, provide concrete recommendations to the advisory group to draw on alongside the contributions of key stakeholders.

MARK COLVIN: What about his proposal that there should be a new national park; that there should be an area which is specifically reserved from logging because he says that's the only way the Leadbeater's possum, which is the emblem of Victoria, is going to survive.

LISA MARTY: Look it's difficult at this stage to pre-judge what might come out of the work of the advisory group. Suffice to say that Professor Lindenmayer is one of the key experts being engaged, and his work will...

MARK COLVIN: But isn't it fair to say that the Forest Industry Association and its previous iterations have always opposed any attempt to lock off more land for the protection of the possum?

LISA MARTY: Look I think in reality there has been an increase in reserves for the possum. It's very unfortunate that along with the impacts on the community of the 2009 bushfires, 45 per cent of the Leadbeater possum reserve area was effected. And unfortunately the Leadbeater possum has been shown to be incredibly fire sensitive and does not continue to exist in the areas which have been effect by fire; so that is really driving a more critical situation.

MARK COLVIN: You would have heard your predecessor, Robert Bain, of the Forest Industry Association last night on the Four Corners program in 1991 saying that he was not worried in the sense that good management would maintain a healthy population of Leadbeater's possum. And he told me at the time it would be alright because they'd be putting in nesting boxes. Now David Lindenmayer says that he did a 10 year study on that nesting boxes idea and the possums simply don't use them. So why would your optimism now be anymore well placed than his then?

LISA MARTY: Look I think that's true, that research has shown that in the Ash forests, where this population of Leadbeater's possums exist, nest boxes are not preferred. They do work very well in Yellingbo, it's difficult to look back and…

MARK COLVIN: That means that you have to have what they call "stag trees" those are the old trees that have the big old hollows in them.

LISA MARTY: That's right.

MARK COLVIN: And the pattern is, isn't it, that the foresters have tended to clear fell them and not leave enough for the possums?

LISA MARTY: Look there are a range of prescriptions in place at the moment to protect Leadbeater possum habitat. Obviously this is a challenging situation and we need to look at what needs to be done in the future, certainly we can look back and we need to learn from the past. But we need to understand based on the work of key scientists right now, what do we need to be doing in the future to ensure the recovery of the Leadbeater's possum. And we certainly believe that the sustainable local timber industry can co-exist.

MARK COLVIN: Lisa Marty, the chief executive of the Victorian Association of Forest Industries.

Politicians back Victoria’s timber industry

Philip Hopkins 
The Gippsland Times, Feb. 26, 2013

LIBERAL, National and Labor parliamentarians, including all Gippsland MPs, united last week to back Victoria's timber industry.

The MPs have formed a bipartisan parliamentary support group for the forest and wood products industry, which was launched at a function at Parliament House on Tuesday evening.

Convened by the Narracan MLA Gary Blackwood, and Ripon MLA Joe Helper, the group was formally launched by the Agriculture Minister Peter Walsh, who has responsibility for forestry.

About 40 MPs and 100 industry representatives attended the event.

All Gippsland parliamentarians are members of the group: Mr Blackwood, Deputy Premier and Gippsland South MLA Peter Ryan, Morwell MLA Russell Northe, Gippsland East MLA Tim Bull and Eastern Victoria MLCs Peter Hall, Phil Davis and Matt Viney. Also a member is the Shadow Minister for Agriculture, Water and Resources, John Lenders, who was born in Warragul and educated in Drouin and Trafalgar.

Mr Helper was the agriculture minister in the last Labor state government.

Forestry is a key industry in Gippsland, which forms the backbone of the Victorian timber sector, both native forest and plantation. According to the Victorian Association of Forest Industries, the industry produces more than $400 million in sawlogs each year, generates $7.8 billion in sales and services income, and directly employs 24,000 people, both in regional areas and Melbourne.

VAFI chief executive Lisa Marty said forestry and the industries that rely on it for wood and paper products had too often been subject to political debate without the appropriate understanding needed to make decisions about such an important part of the economy.

''The products we produce are renewable and store carbon,'' she said.

The keynote speaker Paul Klymenko, chief executive of environment group Planet Ark, spoke about the importance of using forest and wood products as a sustainability resource.

Mr Blackwood, who is also the Parliamentary Secretary for Forestry and Fisheries, said the high attendance at the launch was a strong sign that MPs from all major parties recognised the importance of the industry.

Mr Helper also praised the bipartisan nature of the group, but said Labor still retained the right to disagree on certain aspects of government policy.

''Victoria manages its forests to world's best standards. It is great to see Victoria's elected representatives out in force, and choosing to engage with the industry,'' he said.

The ALP has been accused in the past of sacrificing rural jobs for Green votes in the city. The Bracks' government stopped logging in the Otways at the 2003 election despite timber harvesting there being deemed sustainable under the West regional forest Agreement. Also, at the 2007 election, the Bracks' government added 40,000 hectares of forest to reserves in east Gippsland without offering industry any other forest as compensation.

Mr Lenders told the Gippsland Times that Labor had not yet finalised its timber policy for the next election.

''This year is a listening year,'' he said. However, a policy would be put in place next year before the elections scheduled for the end of November.

Mr Lenders said the party was conscious of the need for jobs in regional Victoria.

''We realise the industry has to have sufficient resource to do what it needs to do and that is more than plantations. We have to finalise that,'' he said.

Value-adding to the resource was a key way to generate jobs.

Mr Lenders said the starting point for the policy would be the timber industry strategy the party took to the last state election.

''This had a number of priorities, such as the review of VicForests, but we have a right to develop new policies if circumstances change," he said.

The State Government is working to put in place its timber industry strategy, launched in December 2011. Its features include giving industry greater resource security through long-term contracts of up to 20 years; compensation for industry if future government policy changes affect timber supply; greater autonomy for VicForests; and a renewed emphasis on biodiversity conservation through surveys and monitoring.

* Philip Hopkins is a former Age business journalist and Gippsland journalist who will be writing occasional articles for the Gippsland Times.

East Gippsland timber destined for chips, power

Adam Morton
The Age (article), 13 March 2012

UP TO 90 per cent of timber logged in long-contested east Gippsland native forests over the next two decades could be woodchipped or burnt by electricity companies to generate power, government documents show.

Woodchips and biomass are being put before endangered species, the Wilderness Society claims. Photo: Louie Douvis

The Baillieu government has started a tender process for 837,000 tonnes a year of woodchips and forestry waste, offering contracts of up to 20 years.

Of this, tender documents indicate 451,000 tonnes a year could come from mixed species forests in Tambo and east Gippsland — the site of Victoria's most heated disputes between timber workers and environmentalists.

But forecasts show that until 2030 the same forests will yield just 50,000 tonnes a year of high-quality sawlog timber used in furniture and construction.

Across the state nearly 30 per cent of logged native timber is considered high-quality, but the documents show that in east Gippsland it could be as little as 10 per cent.

The rest is considered suitable for woodchipping, conversion into low-value wood products such as chipboard or burning as fuel by a new renewable energy industry. Conservationists said it was evidence that these forests were logged to make cheap goods that could come from timber plantations — or in the case of power generation, other sources altogether.

"The government is choosing to put woodchips and biomass [power generation] ahead of Victoria's endangered species," Wilderness Society campaigns manager Luke Chamberlain said.
State-owned forestry agency VicForests said east Gippsland remained one of the largest producers of high-quality sawlogs in Australia.

VicForests spokesman David Walsh said the amount of high-quality timber available for logging in the region had fallen, in part due to the creation of old-growth reserves, but would increase as forests matured after 2030.

"In the short-term, this timber remains vital in supporting local manufacturing and providing much-needed jobs in rural Victoria, as well as reducing our need to import wood products from developing nations," he said.

The tender process is a key part of the Baillieu government's promise to encourage investment in the native forestry industry.

The Coalition guaranteed the industry's long-term future prior to the 2010 election. By contrast, Labor wanted "peace talks" between the industry, unions and conservationists with a goal of reducing logging.
A Saturday Age investigation last month revealed Labor considered shutting down the industry altogether, but ultimately rejected the idea. Some industry leaders warned it was in terminal decline due to a combination of economic, environmental and political pressures.

But Victorian Association of Forest Industries chief executive Lisa Marty said native forestry still generated about $150 million a year in east Gippsland, directly supporting about 2000 people.

Mr Walsh said the plan to sell logging waste previously left or burnt on the forest floor would "impact on sawlog ratios, but will result in a more efficient use of our forest resources". About 80 per cent of forestry revenue comes from sawlogs.

Mr Chamberlain said an efficient industry driven by high-value goods would stop clearfelling forest areas and instead fell only select trees for sawlogs. He said selling logging waste for power generation was effectively "tree mining".

LETTER: Propping up jobs

Dean Wotherspoon, Northcote
The Age, Letter, 15/12/2011



THE latest timber industry plan basically turns the native timber industry into an expensive social security system to help prop up jobs in a handful of National Party seats. It appears that the limited environmental controls over logging and protection of biodiversity are to be wound back, and that Agriculture Minister Peter Walsh is even considering allowing some types of logging (thinning operations) into national parks. Given the non-compliance with environmental regulations these thinning operations have recorded in recent years, it is unbelievable that any competent minister would extend such operations in national parks. This policy is further evidence of the government's anti-environment stance.

Un-sustainability confirmed at last

Sarah Rees, Director, MyEnvironment Inc.
Letter to the editor (not yet published), 15/12/2011

The sustainability report has finally been done on VicForests operations in Minister Peter Walsh's timber 'ACTION' plan. The whole lot is unsustainable - if  it was 'sustainable' then we wouldn't need to log parks, reserves and special protection zones.

Every logging operation is now in breach of our international treaty with the UN Convention on Biodiversity, the Montreal process and Heads of Commonwealth Agreement. Thank you Minister, we have been waiting for this finding! Now we have proof directly from those in charge.

Timber gets long-term commitment

Adam Morton and Tom Arup
The Age, December 14, 2011


THE government has moved to guarantee the long-term future of Victoria's timber industry, ending decades of protection of native forests from logging.

A new timber industry plan substantially boosts the power of VicForests, the government-owned commercial timber agency that the previous Labor government planned to abolish.

VicForests will take over sole responsibility for calculating the amount of timber that can be sustainably harvested, and will determine when and where logging takes place.

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Forestry companies will be offered native timber contracts lasting 20 years, up from the current maximum of five - a step to encourage investment in new mills and equipment.

The government will also indemnify VicForests against the cost if a contract is broken due to changes in policy, potentially leaving the state with the legal bill should a future government want to reduce native timber logging.

Other proposed changes include allowing ''ecological thinning'' of forests in reserves, parks and water catchments, and a review of timber legislation.

Agriculture Minister Peter Walsh said there were no plans for the amount of native forest harvested to increase, and that ecological thinning would be restricted to existing logging areas. He said Victoria's native forest timber was a ''magnificent and renewable resource'' with the potential to support a vibrant long-term industry.

''There is absolutely nothing sinister in this,'' he said. ''It is about, in the areas that were going to be logged, giving certainty to the industry and making sure forests are managed appropriately.''

The plan fulfils a Coalition election commitment. It comes two months after the release of proposed regulation changes that would give the head of the Department of Sustainability and Environment the power to grant loggers an exemption from endangered species laws.

Mr Walsh said yesterday that it was no secret VicForests had problems in the past, but it had undergone substantial change.

He said the Department of Sustainability and Environment would continue to watch VicForests' work.

Australian Conservation Foundation campaigner Lindsay Hesketh said there was a conflict between giving VicForests greater power and protecting the environment. ''It appears this is the same thing that happened with Forestry Tasmania and led to the disaster Tasmania has become,'' he said.

Wilderness Society campaigner Luke Chamberlain said the plan to lock in compensation payments if a future government changed policy was ''agricultural socialism from the Soviet era''.

Opposition agriculture spokesman John Lenders said the plan failed to balance the need to protect the environment and secure jobs.

AM - Victorian government unveils new timber industry plan

AM, TONY EASTLEY
ABC Radio, 14/12/2011 

TONY EASTLEY: A leading ecologist has described the Victorian Government's new plan for the timber industry as 'medieval'. And conservationists say it opens a way for logging in national parks.

However, the plan to open up parks and reserves to logging and extend the length of logging contracts has delighted the timber industry, which says it brings much needed security and certainty.

Simon Lauder reports.

SIMON LAUDER: Australian National University ecologist David Lindenmayer has spent 28 years studying Victorian forests.

Professor Lindenmayer says they've been over exploited for decades and the Victorian Government's new Timber Industry Action Plan could be their death knell.

DAVID LINDENMAYER: We're going to see the extinction of Leadbetter's Possum probably within 30 years. We're going to see forests made more fire prone. We're going to see major complications with Melbourne's water supply.

SIMON LAUDER: At the moment the state government's forestry arm, VicForests, can only give companies access to timber for five years.

Victoria's agriculture minister, Peter Walsh, says that doesn't give the timber industry enough certainty to invest in the future and the government plans to extend native timber contracts to 20 years.

PETER WALSH: We do have a sustainable timber industry here in Victoria. It creates significant employment, particularly in country Victoria. And we are, as a government, are committed to that being a well managed and sustainable industry into the future.

SIMON LAUDER: VicForests and the Victorian Association of Forest Industries say the government's plan helps secure the long-term future of the industry.

The government says it will consider compensating the industry if contracts can't be fulfilled in the future.

Forests campaigner with the Wilderness Society, Luke Chamberlain, says that has implications for taxpayers.

LUKE CHAMBERLAIN: In five years time when they realise, 'Oh, there's no wood there' because it's burnt or it's been logged before, the public is going to have to bail them out, and that is part of this package. And it makes absolutely no sense if this government thinks they are good economic managers.

SIMON LAUDER: The State government's plan includes ecological thinning in reserves, parks and water catchments.

Mr Chamberlain says that opens the door to logging in state parks, protection zones and even national parks.

LUKE CHAMBERLAIN: That more of our forests are going to be opened up to be logged is... (laughs) is just of great concern to us and great concern to Victorians.

SIMON LAUDER: The Agriculture Minister Peter Walsh says the state government won't allow logging in national parks.

PETER WALSH: This is about those areas that have already been set aside for timber production into the future being managed better so you increase the value of timber that is being produced.

SIMON LAUDER: What are the "parks" that are referred to in the plan?

PETER WALSH: Well, it is not national parks.

SIMON LAUDER: What is it then?

PETER WALSH: Well, it is those areas that have already been set aside in the public estate for timber harvesting into the future.

SIMON LAUDER: Could it mean national parks in the future?

PETER WALSH: It does not mean national parks. And those people who are trying to imply that it does are just making mischief.

TONY EASTLEY: Victoria's Agriculture Minister Peter Walsh speaking to AM's Simon Lauder.

Green paper needs Reflex action

Ben Butler
The Age,  May 30, 2011

Wilderness Society protesters dressed in ‘Victoria’s Secret’ lingerie earlier this month to expose Victoria’s 'dirty little secret' – woodchipping native forests to make Reflex Paper that is sold in Officeworks. Photo: Edwina Pickles

REFLEX, Australia's best-known brand of paper, is set to lose its international green accreditation within the next two months unless its manufacturer can strike an unlikely deal with some of its fiercest enemies.

The loss of Forest Stewardship Council (FSC) certification would force Australian Paper, which makes Reflex, to either abandon its public commitment to the FSC process or shift its sourcing from native forests to more expensive plantation timber.

News that Australian Paper's international certification is at risk will come as an embarrassment to Agriculture Minister Peter Walsh, who recently threatened to take forestry jobs away from the Yarra Ranges Council unless it ends a boycott of Reflex paper.

It also threatens Victoria's state-owned logger VicForests, a key supplier of native forest woodchips to Australian Paper.

Australian Paper's problem arises because FSC rules have been tightened since its certificate was issued five years ago. Under the new rules, the company must consult with stakeholders over logging in ''high conservation value'' areas.

Australian Paper's certificate expires on July 26, leaving it little time to reach consensus with environment groups, many of whom oppose logging in forests containing endangered species.

Complicating the process, one of the groups, Central Highlands-based MyEnvironment, has lodged a complaint about Australian Paper's auditor, Smartwood, with the FSC head office in Germany.

The complaint has sparked an international review of Smartwood, a division of environmental standards body Rainforest Alliance, that could lead to its authority to audit wood supply being revoked.

''My understanding is that we could, in theory, be suspended, but we're a long way from that,'' said Smartwood spokeswoman Anita Neville.

''If they find flaws in the system, corrective action is required.''

She said that under the ''annex 3'' system, which governs consultations over high conservation areas, ''100 per cent agreement'' between Australian Paper and environment groups was not required.

''You have to eliminate the worst cases of disagreement, and that's not always easy,'' she said.

FSC Australia chief executive Michael Spencer said that under the organisation's rules, Australian Paper needed to consult with all stakeholders with an interest in the forest, including environmental groups.

Asked what would happen if no deal had been struck by July 27, he said: ''My understanding would be, and I haven't dealt with this in the past, their certificate would lapse if it hasn't been renewed.''

MyEnvironment director Sarah Rees said Australian Paper had made contact with her on Thursday. ''We're really receptive to helping the company move its wood supply from native forest to the burgeoning plantation sector,'' she said.

In any case, she said, the Black Saturday bushfires had slashed the amount of wood left in native forests to about two years worth of supply.

''The real opportunity for the company is to get the Australian Conservation Foundation and the Wilderness Society and local environment groups standing by them saying, 'Job well done'.''

Australian Paper spokesman John Rider did not return calls.

Last year, chief executive Jim Henneberry publicly committed the company to FSC principles, including not obtaining wood from high conservation areas.

In a statement, VicForests spokesman David Walsh said the logging company ''supports Australian Paper's work to achieve certification to a range of industry standards - including its efforts to maintain FSC certification''.

WHAT DO YOU THINK: Yarra Valley loses potential 80 jobs after Reflex boycott

Alex Munro
Leader Newspapers, 23 May 2011

WHAT DO YOU THINK: Yarra Valley loses potential 80 jobs after Reflex boycott - Lilydale & Yarra Valley Leader - News - Leader News : http://leader-news.whereilive.com.au/news/story/paper-stand-fallout/


THE state’s peak timber industry body has pulled out of plans to move their head office and 80 potential jobs to the Yarra Valley because of council’s decision to boycott Reflex paper.

The revelation came as Cr Chris Templer broke ranks to attack Yarra Ranges Council’s April 27 decision to sign the Wilderness Society’s ethical paper pledge, calling it a mistake based on an ideological opinion.

Agriculture and Food Security Minister Peter Walsh confirmed last week that an offer to move VicForests’ main office to either Yarra Glen or Healesville had been withdrawn because of council’s support of the pledge.

“The proposal was under active consideration, however in light of the council’s recent decision to take the so-called ethical paper pledge I have since written advising them that the relocation is off the table,” Mr Walsh said.

“The council has been hypocritical in seeking to attract VicForests while actively campaigning against a product that forms part of its core business.”

It is believed councillors discussed the pledge again at a meeting last week and re-affirmed their support for it.

Mayor Terry Avery said relocating VicForests to the valley would have demonstrated commitment to expanding employment and stimulating economies directly affected by Black Saturday. “We are disappointed that Minister Walsh has chosen to establish a direct link between the two unrelated issues,” Cr Avery said.

Yarra Glen Chamber of Commerce and Tourism president Bob Curtis furiously condemned signing the pledge, saying the town would welcome VicForests with open arms.

“The council needs to revoke this decision immediately, and then beg the government and VicForests to bring the office out here,” Mr Curtis said.

“Their green protest has just cost 80 potential jobs for towns that are in absolute need of them.”

MyEnvironment director Sarah Rees said it was deplorable for the State Government to blackmail the council over its decision to represent the rights of its constituents.

Has the council made a mistake? Tell us what you think at the end of this page.

Council gags on Reflex vow

Anne Wright
Herald Sun,  May 21, 2011

A COUNCIL has been warned to lift its ban on a brand of paper or risk losing 45 new jobs.

The State Government said a proposal to move the VicForests corporate offices into the Yarra Range Council's area would be "off the table", unless it started using Reflex paper.

A letter from Agriculture Minister Peter Walsh to Yarra Ranges Council chief executive Glenn Patterson, seen by the Herald Sun, commended the proposal for the VicForests corporate office to move, which would create 45 jobs.

Mr Walsh then says the proposal will be "off the table" unless the council stopped its Reflex boycott.

The threat originated from the council's signing an environmental pledge to stop using the brand because it is made from native forest, which is against the council's policy.

But Mr Walsh said Reflex was a product of Australian Paper, an "important client" of VicForests, and any council signing the "so-called ethical paper pledge" from the Wilderness Society would miss out on the move of the VicForest jobs.

"In my view, council has been hypocritical in seeking to attract VicForests while actively campaigning against a product that forms part of its core business," he said.

But Yarra Ranges mayor Terry Avery said the council joined the Wilderness Society's pledge to not use Reflex paper, and opted for an Australian product line also manufactured by the Australian Paper.

"We feel strongly that the pledge is an accurate reflection of our commitment to sustainability, protection of the environment, corporate social responsibility and local community needs," Cr Avery said.

He said the council would not back down.

"We are disappointed that Minister Walsh has chosen to establish a direct link between the two unrelated issues," he said.

Opposition resources spokesman John Lenders said the Government was threatening jobs in the local community.

wrighta@heraldsun.com.au

VicForests operations condemned

Ben Butler
The Age (article), February 23, 2011

THE government-owned company that logs Victoria's native forests is running out of timber, has failed to keep track of how much forest is left to log and cannot manage its costs, a damning Treasury report has found.

VicForests has also twice breached Department of Sustainability and Environment rules by logging too much and its backlog of forest that needs replanting has nearly tripled, according to the report by forestry expert URS.

Released to The Age after a freedom-of-information application, the report portrays an industry in decline, with jobs on the line as the supply of trees dries up. Its early leak to another media outlet has embarrassed the Baillieu government, under pressure because of divisions between the Liberals and Nationals over conservation issues.

In the key forestry battleground of East Gippsland, where Vicforests has repeatedly clashed with environmentalists, the number of quality logs suitable for sawn timber is ''expected to decline significantly within about 10 years and impact adversely on businesses directly involved'', URS said.

''Assuming forecasts are correct, it may not be possible to supply sawmills located in the East Gippsland area with sufficient sawlogs from the region,'' URS said. Those mills might have to ''reduce their operations''.

The report found Vicforests wrongly logged 87 hectares in the Central Highlands and East Gippsland.

''The dispute could have material financial consequences, especially if DSE pursues legal action,'' URS said.

But VicForests spokesman David Walsh said the organisation had reached a settlement with DSE over the breaches.

URS said VicForests' estimates of still-standing timber were up to 65 per cent too high, although Mr Walsh disputed the calculation.

In addition, the amount of forest that has been harvested but not regenerated and handed back to DSE has blown out from about 5100 hectares in 2004-05, VicForests' first year of operation, to more than 15,900 hectares in 2008-09, URS said.

The organisation's inability to manage its cash flow led to what was described by URS as an ''emergency increase of the credit line'' from Treasury of $16.6 million last year.

VicForests also failed to collect money from customers quickly enough and was not fully considering the impact decisions would have on its cash reserves, URS said.

URS said it was critical that VicForests rein in the cost of harvest and haulage, which it underestimated by about $8.5 million last year.

Agriculture Minister Peter Walsh blamed VicForests' problems on bushfires and the former Labor government's logging restrictions. He said the government would work with the company to implement the recommendations.

VicForests chief executive David Pollard said the report recognised the company's significant achievements and it was addressing issues ''where appropriate''.

Numbers add up

Sarah Rees, Healesville
The Age (letter), 26 Jan 2011

IN THE article ''Minister challenges logging advice'' (The Age, 24/1), Forestry Minister Peter Walsh gives a welcome commitment to examine the status of endangered species in areas exposed to logging.

While the minister appears unaware of the Department of Sustainability and Environment's science up until his appointment, basic skills in maths should make light work of this investigation. Mr Walsh says he ''find(s) it hard to understand how such a small area of logging can have such a big impact''.

Some 70 per cent of the ash forests in this state - the wood the chippers are after and home to many of Victoria's endangered species - is available for logging. Logging is taking out between 2 and 3 per cent of these forests each year.

Given that intensive ash logging has taken place since the 1950s, how many years of logging will it take to reduce 70 per cent of the old ash forest to young saplings incapable of housing hollow-dependent mammals?

Couple this with fires in an average of 40 per cent of the ash forest in national parks and, bingo, you have an extinction crisis.

Mind the habitat

Murray Barson, Hurstbridge
The Age (letter), 26 Jan 2011

AGRICULTURE Minister Peter Walsh ''find[s] it hard to understand how such a small area of logging can have such a big impact'' on state forest biodiversity (''Minister challenges logging advice'', 24/1). (One wonders if he is a climate-change sceptic too.)

The man admits his ignorance and should take the scientific advice offered, not hide behind the wasteful procrastination of a departmental study. Habitat destruction is not an easily reversible process.

If the state's timber industry is indeed financially unviable, ''20 years' access … to timber'' only prolongs the agony, but may irrevocably damage the forests.

Vested interests, factional pressures and marginal electorate sensitivities must not be allowed to warp the decision process.

Minister challenges logging advice

Adam Morton
The Age (article), January 24, 2011

VICTORIA'S new forestry minister has challenged scientific warnings that the timber industry is putting endangered species at risk of extinction, arguing that only a fraction of the state's forest habitat is logged.

Agriculture Minister Peter Walsh, whose portfolio includes responsibility for state forests, denied claims the forest industry was in crisis, but said it was ailing, after years of gradual cuts to timber allocation from state forests stymied investment. The Coalition has promised to restore industry confidence by guaranteeing access to current levels of state forest timber for up to 20 years.

The commitment comes amid warnings from scientists led by David Lindenmayer, an Australian National University ecologist who has worked in Victorian forests since the 1980s, that the combination of bushfires and aggressive logging in the central highlands is putting threatened species such as Leadbeater's Possum, the state faunal emblem, at risk. But Mr Walsh said he was not persuaded the timber industry was a significant threat.

"I find it hard to understand how such a small area of logging can have such a big impact as some people are saying when you consider the totality of the forest area that's never ever touched,'' he said.

''The Department of Sustainability and Environment has never carried out any survey work on threatened species outside of these small areas of production forest. It's difficult to quantify the impacts of the timber industry if you don't actually know against what you are making a comparison. We have asked the department to do this work.''

Professor Lindenmayer said Mr Walsh's comments were those of a minister still getting on top of his brief, and offered to give him a briefing and a tour of central highlands forests.

He said dozens of books and hundreds of scientific papers had been written showing the threat that clear-fell logging in the state's 171,000 hectares of mountain ash forest posed to endangered species.

''We're logging in a way that is very intense and sets back the forest many centuries,'' he said.

Coalition support for state forests logging was a point of difference with Labor, which had promised to sponsor Tasmanian-style "peace talks" between the industry, unions and environmental groups.

Environmentalists say logging in state forests is economically unviable and being propped up by government subsidies.

Mr Walsh said he had no problem with talks being held over the industry's future, but the government should not be involved.

"If the unions and the industry and whatever want to sit down and have discussions I think that's appropriate that they do it, but by government being in there when we've said what we want to do would not necessarily be the most productive thing,'' he said.

He said his office was considering results of a Treasury review into the state's logging agency VicForests, which received a multimillion dollar bailout from taxpayers last financial year. But he was dismissive of a Brumby government plan to replace the agency with a body that had a broader remit also to allocate water and carbon rights.

"I really think they [Labor] were trying to be all things to all people and I really don't know how it was going to actually have a meaningful role - it just seems such a broad brush thing with no detail," he said.