Who is VicForests?
Only in Queensland was the forest issue resolved, with the Beattie government moving to protect 425,000 ha of native forests and transition the state’s logging industry into plantations in 1999. Significant gains for forest protection were also achieved in New South Wales, Western Australia and western Victoria.
In Victoria, five RFA’s were signed for different regions across that state but the process failed to protect old growth forests, water catchments, rainforests and endangered wildlife habitat. Instead logging in native forests dramatically increased in eastern Victoria after the RFA’s were signed, driven by an alarming increase in woodchipping.
For example for the 1994/95 logging season 6646 hectares was allocated to logging to produce 79,965 tonnes of woodchips. By 2002/03 logging had increased to 11,459 hectares, extracting 1,668,963 tonnes of woodchips.
Only in the western Victorian RFA was a solution found when Premier Bracks created the Great Otway National Park and transitioned logging into plantations in 2002.
In 2004, the Victorian government handed over the logging of our native forests to a new Government Business Enterprise (GBE) – VicForests. While many people will have heard of the role Forestry Tasmania play in the destruction of Tasmania’s forests, most Victorians will not be familiar with VicForests or what they do.
VicForests manages the logging and selling of Victoria’s native forests, mostly to foreign owned woodchip and paper companies. As a GBE, VicForests is expected to return a dividend to the people of Victoria for the selling of native forests on public land which are owned by Victorians.
Instead, taxpayers continue to subsidise VicForests’ operations whilst paper and woodchip companies make massive profits.
VicForests’ logging:
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Reduces the supply and quality of water flowing into dams and rivers; -
Releases vast amounts of carbon dioxide (CO2) into the atmosphere, making climate change worse;
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Pushes wildlife closer to extinction;
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Increases the risk of more frequent and intense wildfires;
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Lines the pockets of wealthy woodchip company executives;
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Generates conflict in rural Victoria.
The Creation of VicForests
The creation of VicForests was an attempt by the Bracks Labor government to bring transparency to the selling, pricing and allocation of native forests.
Until then, logging companies received native forests guaranteed in long term license contracts, at prices set significantly below the market price for the wood. For example, one contract obtained under Freedom of Information laws set prices for native forest wood at a paltry 11 cents per tonne. Victoria’s old growth forests were being given away.
So in 2004 VicForests was established to create an auction system to replace the long term licenses and set market prices for wood. This was supposed to ensure the State government’s compliance with National Competition Policy, which stipulates that state run businesses must not have competitive advantage over private enterprises competing in the same market. Instead sitting within departments of conservation or primary industry, VicForests would be the responsibility of State Treasury.
Conservation groups including The Wilderness Society cautiously welcomed the announcement, hoping that logging companies would no longer receive subsidies and government assistance.
Finally it was also hoped that the native forest sector would have to compete with the plantation sector without government assistance.
So who benefits?
Primarily foreign owned woodchip companies and their owners;
1.Australian Paper – now wholly owned by Japanese paper company, Nippon Paper;
2. South East Fibre Exports – Also owned by Nippon Paper;
3. Midway – Australian owned, Midway has run an extremely profitable woodchipping business, while sawmills in regional Victoria struggle to access quality sawn timber. Midway is a private company and its owners are Melbourne based wealthy company executives.
Officiating at the opening of VicForests new Healesville office are (from left) John Lenders (Victorian Treasurer), Ben Hardman (ALP MP for Seymour)
Global Giant Nippon Paper receives our water catchment forests for as little as $8.50 per tonne and will continue to enjoy this base price until 2030 due to the 1996 Wood Pulp Agreement Act .
This legal contract secures our forests for woodchips $21.50 cheaper than the rate for plantations . Nippon will receive a $250 million dollar windfall from this legal agreement. The commercial cost of plantation forests of equivalent value is at least $30.00 per tonne.
No other industry enjoys this level of resource security in legislation. The real cost of native forest woodchips would be much higher if it were not for the taxpayer subsidies which allow this business to continue.
The on costs to water loss, ecosystem collapse, extinction and impact on tourism has never been measured by the Victorian government.
Sponsorship
MYTH: VicForests claims that it runs a commercially viable GBE.
FACT: In 2007 VicForests logged $100 million dollars worth of forest and made a $17,000 dollar loss.
In 2008, VicForests only made a profit due to a direct taxpayer subsidy of $5.68 million.
This does not include the enormous economic cost of lost water and destruction of carbon banks.
The History
In the lead up to the creation of VicForests in 2004, the public debate over whether to protect or woodchip native forests was Victoria’s biggest environmental issue.
In the mid-1990’s, the joint federal/state Regional Forest Agreements (RFA’s) were supposed to resolve the forest debate in Australia once and for all, but in Victoria and Tasmania the RFA’s only succeeded in greatly increasing woodchipping levels while reducing sawn timber from native forests.
