A Splintered Peace
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- Created on Monday, 08 October 2012 11:00
- Written by Julian Amos
It is obvious that it was a requirement of the Greens that this be so, and that is purely politics. In fact, on forestry matters, the Greens would appear to be the policy determiners, even to the extent of rolling the responsible Minister and Deputy Premier in Cabinet on this matter. What were his Labor colleagues thinking when they allowed this to happen?
Greens leader McKim has even called FT a rogue agency. I challenge him to justify such salacious propaganda. FT is an independent authority, with a charter as determined by an Act of parliament. Has it stepped outside its charter? No. Has it broken the law? No. Has it managed the forests on a sustainable basis. Yes. Has it cooperated fully with the IGA process, providing data to assist that process, even against its own commercial interest. Yes. Does it disagree with the McKim prescription for the future of the forest industry? Yes.
That makes it a responsible entity, it does not make it rogue. In fact, FT should be seen and could be used as a vehicle for change and improvement in the industry, not an impediment to it.
But back to the talks. Industry has returned to the table albeit reluctantly, to try and reach agreement on a continuing guaranteed wood supply for the industry. The process is proceeding at a glacial pace, and industry representatives have now stated that any agreement will need to be reached by the end of the month, or else they will leave the table permanently. In my book, the end of the month will come without any agreement, and so players be warned – there will need to be a Plan B.
I make this prediction because the competing claims cannot be reconciled. And to explain why, lets recap.
Some years ago, Gunns decided it would walk away from native forest harvesting. At that time, Gunns was a major player in the industry, having reached its position by a series of commercial acquisitions. It was FT’s major customer for native forest product – it took around 145,000 of the 300,000 cubic metres of sawlog each year, and it was a major grower of plantation timber on private land. These plantations were grown specifically as pulp timber. Just as scones cannot be made into a fruit loaf, so pulp logs cannot be converted into sawlogs. The ingredients are different, the treatment is different.
The decision to withdraw was made for a variety of reasons, not the least being Gunns’ desire to obtain a “social licence” for its pulp mill proposal in the Tamar. Gunns was even compensated by both governments for making this decision, an extraordinary outcome. However, the decision has had some serious consequences. For starters, FT’s sawlog revenue was halved, company employees were made redundant, and the company’s contractors were left high and dry.
At that time, FT had around 1.5 million hectares under management, of which some 700,000 hectares was for wood production. The remainder were in reserves of one kind or another. What with the conservation movement seeking further forest land to be reserved from FT’s management, the government under Premier Bartlett, on urging from a number of national players, called for a “round table” to resolve the conflict.
From this process, industry sought a guarantee that sawlog supply would be retained at 155,000 cub metres per year. This figure was the amount of timber that FT was still under contract to supply. Meanwhile, the conservationists called for an immediate cessation of logging from 430,000 hectares of forest, and a request to consider up to 572,000 hectares in permanent reservation. This amount of land is a significant part of FT’s operations. Governments supported the process, and encouraged participants to resolve the matter.
These competing claims simply cannot be reconciled. The remaining native forest cannot supply the necessary volumes of sawlog, nor can the plantations, for the reasons mentioned previously.
Unfortunately, (or tactically, depending on one’s point of view), a number of conservation groups were excluded from the process and stated they would not be bound by any agreement arising from it. They wanted to continue their campaigns to undermine Tasmanian product in the market place, arguing that the forests were being trashed. A good line for propaganda, irrespective of the truth. In fact around 50% of our forests are in national parks, an amount conveniently ignored by the claimants.
So the issue of durability arose. Industry argued that even if an agreement was reached, and wood supply assured, how could it be guaranteed that the protests would cease. Again, the obvious answer was that they could not be given such a guarantee. “Best endeavours” became the buzz words.
As the process ground on, with minor concessions being made by both parties, the Greens call for FT to be broken up came to pass, which meant for industry that there could now be no guarantee of continuing wood supply.
For these reasons, it is obvious that the parties will never be able to come to an agreement. If the parties walk away, then one option would be for the government to impose a solution. It would need to be in the form of legislation to amend the Forestry Act, and that will need to pass the Legislative Council. And I suspect that won’t happen.
The end result of all of this manouvering is that the status quo will remain, with the parties jostling for airtime to prove their point of view, with many people who were gainfully employed now out of work, and the opportunity for Tasmania to develop its natural assets squandered.
Government will need to determine a policy on forestry, and not leave it to minority pressure groups to determine policy on its behalf.
The negotiated IGA sponsored non-Agreement?
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- Created on Wednesday, 15 August 2012 10:00
- Written by Julian Amos
The forestry IGA negotiations continue. Three deadlines have passed, and still the participants remain at the table, unable to come to any agreement. We have now reached a position of high farce. The industry representatives seek a guaranteed minimum sustainable wood supply, and the environmental representatives want a guaranteed minimum of ground preserved from logging.
These two demands remain irreconcilable.
Both agree that for any agreement to work there will need to be an end to protests. This is the so-called durability condition. And yet those not at the table insist that their right to protest not be diminished, irrespective of any agreement. So much for durability.
Various modelling has been carried out, but the model does not throw up the answers that they all want. Certain hectarage is planned to be set aside, but there has been some “bracket creep” in the modeling. Like the Generals after the Great War poring over the map of Europe, considering if a bit could be shaven off the demand here, a bit more there? Could the model then work? Well, no it can’t. And if a sufficient amount of ground was removed from the demand to make the model work, then those who are not at the table would not agree, and the protests would continue.
The governments want an agreement, irrespective of the details. So they insist that the parties continue at the table. There is no Plan B in their back pocket. For them, there is a significant amount of capital that has been invested, and failure would mean egg on all their faces.
Meanwhile, those who have investments in the industry suffer, those who have lost their jobs and livelihoods are in an awful state of mind, rural communities are in a state of crisis, and those still in the industry cling on with little hope and little confidence. And in all of this morass, the employees of Forestry Tasmania are subject to a never-ending level of abuse, for being professional at what they do.
What a sorry state of affairs. We even had the spectacle of the Federal Minister ordering in late night pizza, so that talks could continue through the night. How much more ridiculous does it have to get before the participants agree to walk away from the table.
This is no way to conduct a negotiation, and especially not the way to determine the future use of a public resource. Negotiation by exhaustion is a poor excuse for proper negotiating behavior, where no deal is better than a bad deal.
There is a risk that they might come to an agreement that no party actually wants. This is the so-called Abilene paradox, where a group of people decide on a course of action because they think others in the group wish that course of action to be followed. Afterwards they discover no one really wanted to follow that course of action after all. It smacks of a phenomenon called group-think, a common enough occurrence when a group of people get together to establish a consensus position, the consensus becomes the overriding objective, and where individual views are subsumed in order to reach it.
What is more intriguing is that the government is delegating the authority to make a decision to a group of people who do not represent the public interest, nor indeed fully represent their sectional interests.
The CFMEU may require redundancy payments for its members, but don't think for a moment they represent all workers in the sector. The CFMEU does not represent the employees of FT, for example.
The ACF, TWS and ET may want vast areas of land locked away, but again don't think for a moment they represent the views of the wider public. And they certainly do not represent environmental groups such as the Tarkine National Coalition, who have stated they will continue in their campaign to preserve the forests of the north-west.
FIAT, TCA et al may represent a part of the existing industry, but not necessarily all of it, and certainly not future prospective entrants who may well wish the opportunity to develop this public resource. They do not represent the private forest owners, nor the mining sector, each of which will be impacted by any decision made around the table.
Any agreement will need to pass through the Legislative Council, and Councillors have already alluded to the fact that they will take into account all interests, including those not at the table. So even if an Agreement was reached around the table, it would still not pass into law.
Meanwhile, while this dance is being played out, there has been the sceptre of gutting Forestry Tasmania (FT) as a sop to the Greens in Cabinet. These moves are ill-founded and the motives ill-informed. Critics keep on saying FT does not pay its way. What they conveniently forget to mention is that FT carries out a lot of functions unrelated to, or accessory to, turning a dollar. As the Act states, the objective of FT is two-fold, to optimise the economic returns from its wood production activities, and to also optimise the benefits to the public and the State of the non-wood values of forests. It is a land manager with a commitment to multiple use, not a single use. Privatising FT will do nothing to resolve the issue – in fact it will probably exacerbate it.
It has been suggested that there may be a deal simply because there is no alternative.
However, imagine if all the effort that has gone in to closing down forestry had instead gone in to strengthening the sector. In developing markets rather than undermining them. To research new products, rather than ignoring the value of such research, to recognise the value of biofuels, rather than condemning them.
Arguments regarding the high value of the dollar may have a certain resonance, but it has not stopped the export of native woodchips from other states. And it is not appropriate or proper to simply give in. So what might a Plan B look like:
It would need to recognize the following imperatives:
· To support existing operations, and existing employment.
· To ensure the resource remains open and to remove sovereign risk
· To shore up existing markets, and hunt down new ones
· To recognize that half of Tasmania's forested land is already in reserves – the remainder is being managed in a sustainable manner
Actions that government could take immediately include:
· To use its authority to reopen the Triabunna mill, and if not, to lease existing plant elsewhere in the state
· To cover the cost for the transport and processing of all existing sawmill waste which has been allowed to build up during the IGA process
· To fund a special mission to Asia to establish a new market environment and new marketing arrangements, and to sell the existing stockpile.
· To pay for the opening of a PERMANENT Tasmanian trade office, in a linkage with Austrade.
· And for the Federal government to reconsider its position on biomass.
Immediate support such as this would give a much-needed lift and confidence to an industry seeking a way forward. This is where governments should be concentrating their effort, and this is where they should be spending taxpayer dollars. Much better to be spending money this way, rather than paying compensation for putting people out of work.
Support the IGA, or abandon it
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- Created on Thursday, 29 December 2011 11:00
- Written by Julian Amos
The IGA was signed by both the Commonwealth and State Governments in August this year. Under this Agreement, wood supply to industry is guaranteed, as is the consideration of up to a further 572,000 ha of forested land to be placed in reserves.
The Greens are a part of the Tasmanian Government, and have two ministers in the Cabinet.
The IGA was supported by all signatories to the peace process, which included the Wilderness Society and Environment Tasmania.
Clause 17 of the IGA acknowledges the requirement for 265,000 tonnes of peeler billets, which is the contracted supply to Ta Ann.
Environment groups have boasted of their success in undermining Ta Ann’s markets, including a supplier of materials for the London Olympics.
The Greens have shown no support for Ta Ann, and have been openly critical of the company. The Government must declare its support for Ta Ann, and in accordance with the IGA, demand the Greens retract their statements.
Environment Tasmania must condemn the actions of the environment groups that have sabotaged Ta Ann’s markets.
If these two actions are not taken, then the IGA is not worth the paper it is written on, and should be torn up. The parties should then return to the Regional Forest Agreement, which still stands.
Dr Julian Amos
Signing the Conservation Agreement
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- Created on Monday, 16 January 2012 11:00
- Written by Julian Amos
Last Friday, the State and Federal Governments signed a Conservation Agreement excluding forest operations from 428,000 hectares of public native forest. Forestry Tasmania (FT) was also a signatory to this Agreement. This move has prompted an outcry from conservation groups, condemning the governments for allowing operations to continue to occur in some 2,000 hectares of forest. What is going on?
A Conservation Agreement is a device under the Commonwealth EPBC Act to enable areas to be excluded from a particular type of activity. For it to be effective, it must have the support of the State Government and the land manager, in this case FT.
In one respect, the signing of this Agreement does not change anything much. It simply formalizes a matter covered in the Intergovernmental Agreement (IGA) by the Commonwealth and State governments, which was signed in August last year.
Under the IGA, the two governments agreed to remove UP TO 572,000 hectares of native forest, which the environmental movement purported to be of high conservation value, from active forest management. This was to be subject to two separate and independent verification reports.
The first report related to the immediate setting aside of an initial 430,000 ha of native forest into informal reserves. Under the IGA, this was to be an interim matter only, and was designed to ensure immediate cessation of forest works within that area while the second report was being prepared. However, there was a caveat. Harvesting could occur within designated coupes if it could be proven FT had no alternative if it was to satisfy existing contractual commitments for sawlog and peeler log supply. This report was delivered to the government in early October, and concluded that FT must have continuing access to at least 25 of these coupes within the 430,000 hectares between the signing of the document and end December 2011.
The timeline for the second report, originally end December 2011, has now been extended to 30 June. The Conservation Agreement simply formalizes this process, setting aside 428,000 of the 430,000 hectares until the final report is received - or 30 June, whichever is the sooner.
The second report was to detail the boundaries of high conservation value forest within an area up to 572,000 ha. The committee preparing this report (chaired by Jonathan West) now expects that its work will not be concluded before the end of February.
The Conservation Agreement in part recognises the extension of the timeline. It requires the support of all parties to the Agrement. It is temporary, it is voluntary, and it enables FT to continue to operate in some 2000 hectares to achieve its contractual commitments.
The more substantial matter remains unresolved. The IGA process, of which the Conservation Agreement is now a part, is not going to be smooth, as there are some significant issues that still require consideration.
The Conservation Agreement, which expires 30 June, has been rejected by the conservation movement because of the 2000 hectares deemed necessary for FT to continue to fulfil its contractual requirements. Yet the need for FT to meet its contractual commitments, an equal condition to all others,was part of the IGA which the conservation movement supported.
The Conservation Agreement is also regarded with deep suspicion by industry as it causes a change of land status which might be difficult to reverse if the IGA fails. However, a permanent change in the status of the land will require state legislation, and the Legislative Council has already stated that it will not support such a change.
The Committee chaired by Jonathan West is still considering the area (up to 572,000 hectares) which is to be considered of high conservation value. As I have stated before, this is going to be some task, as this phrase is meaningless. Like beauty, it is in the eye of the beholder, and like beauty, it is equally ephemeral. It is without definition, and yet it is held up to be the definitive determinant for the establishing the boundaries of new formal reserves.
Again, as stated previously, Forestry Tasmania has advised both governments that, if such an area is set aside, then it will not be able to meet its continuing, legally contracted supply commitments. Governments seem incapable of absorbing and responding to this fact.
The company Ta Ann Tasmania has come under criticism from conservation interests because it sources wood from our native forests. However, the criticism is unfounded because the wood sourced is from actively managed regeneration forest. In fact, the company’s operation is designed to take just that type of timber. Old growth just doesn’t cut it – pardon the pun. And yet the sledging continues.
The management of the Triabunna woodchip mill has stated it will not accept any wood that comes from the 572,000 hectares, even though the West committee has not yet determined where the boundaries might lie.
The case for access to special timbers, essential for the craft and boatbuilding industries, also seems to be ignored. The success of the IGA will permanently remove most of their present allocation, and be a disaster for those enterprises.
The argument continues that changed market conditions have caused the industry to falter. This is simply not true. The market is still buying wood product, the sawmillers are selling all they can produce, veneer products continue to find markets, and the overseas markets are still buying product, including woodchips, from Australia.
It is true that Gunns’ management had difficulties in the offshore market for woodchips, but Gunns is not the industry, and I suspect the market difficulties were more a “Gunns” issue, than a change in underlying demand for forest products.
The IGA is the culmination of the roundtable process, which was meant to bring all interested parties together, to resolve the forest conflict. It is obvious that whatever the outcome of the IGA there will be many unhappy campers. Already many interest groups have now complained that their interests were not represented at the table, and have disowned the process. I suspect more will follow.
For better or for worse, the forest conflict continues unabated.
The initial advice prepared by the two independent expert schedulers covered the period to the end of 2011 and was presented to governments and Signatories on 13 October 2011. Following consideration of this initial advice, Signatories requested further information from the independent expert schedulers to clarify and expand on a number of elements. This second report was provided to Signatories on 17 November 2011. As this advice focused on the period to the end of 2011, a further report covering the period to the end of February 2012 was commissioned by the Australian Government and completed on 23 December 2011.
The independent expert forest schedulers found that while some harvesting work could be moved, it was not possible to reschedule harvesting in some coupes. In accordance with the requirements of the Intergovernmental Agreement, which commits to honouring all existing wood supply contracts, these coupes have been excluded from the Conservation Agreement.
The Forest cauldron continues to boil
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- Created on Friday, 14 October 2011 11:00
- Written by Julian Amos
There have been many twists and turns in the forestry debate over many years. Without retracing a blow by blow description of events, the interminable and never-ending conflicts over forestry boil down to two different value sets. One is to conserve native forest for reasons of nature conservation, the other is to manage forests for their wood value, thus employing people and generating wealth.
Much has been said, but three recent developments are pertinent, and involve four different groups of players. The players are the industry and forest workers, the conservation groups, government and Forestry Tasmania.
During the middle of 2010 Premier Bartlett set up a round table to resolve all forest conflict. A somewhat naïve ambition considering the two opposing value sets and the long and tortured history. A shuffle occurred within industry and within the conservation groups to see who would be sitting at the table. Spokespersons for both sides spruiked their basis for representation, but the truth is many parties were disenfranchised at that point. The government made available officers from FT to assist the discussions by providing factual information to each of the parties. However, they had no seat at the table, and neither did the government.
The first development was the drafting of a document called the “Statement of Principles” (SoP). This document was drafted by the two groups after a period of time - 6 months of talks were foundering – when pressure was applied by both sides to get something agreed. It would be fair to say that the sceptre of the Gunns pulp mill loomed large at this time, with the threat that parties would withdraw from the process if the draft was not agreed to. Under some duress, the draft document was agreed to, and is a dog’s breakfast of a document .
However, this then sent the government to Canberra to seek funding for the “next round”. Canberra, although unimpressed with the Statement of Principles, came to the party – sort of – and provided Bill Kelty as a facilitator for the next round of discussions, which was to determine specifically the areas of forest under debate and still maintain wood supply. Kelty eventually came up with a document that was supported by the parties and which was put before the two governments, who then signed a Heads of Agreement document (the HoA).
During the process FT’s management approach and data were independently scrutinized and their data and calculations were found to be sound.
The HoA covered two salient points. For the NGO’s it meant a phased withdrawal from all native forest harvesting, an immediate reservation of 430,000 ha of State Forest, and a final reservation of 570,000 ha. For industry, it meant ongoing security of resource supply for sawlogs (150,000 m3),peeler logs for Ta Ann (265,000 m3), and specialty timbers (12,500 m3).
For FT, it meant a further and significant withdrawal of hectarage from the forest estate under its supply management. The problem was obvious to all. Supply could not be guaranteed if the land in question was no longer able to be harvested. And contracts were already in place for this level of supply.
A draft document was then circulated to the parties prior to government sign-off. Three days later, the two governments signed an Inter Governmental Agreement (the IGA) to enable the two governments to provide further support. However the IGA contained different provisions to that in the draft. No longer was there a security of supply, in fact compensation was going to be offered instead. Industry smelt a betrayal, and it was found that the governments were influenced by a submission from Jonathan West, an economist, who was then entrusted with an ongoing boundary verification process. Professor West believes that the IGA will deliver an outcome where supply can be met and that protests will stop. This is a minority view of one. It is not a view held by FT, the industry nor it would appear some conservation groups who have vowed to continue with protest action.
Last weekend people protesting against the IGA held protest meetings in Hobart and Smithton where it was made clear by Liberal MP’s, local mayors, forest workers, the AWU and others in the industry, traditionally supporters of the government, that the IGA was unacceptable.
Government has committed itself to the IGA, even though FT has advised it will be in breach of its contractual commitments. An invidious position for FT’s Board and management.
FT is a GBE, and operates under two separate acts of parliament, being the Forestry Act and the Government Business Enterprises Act. Under each of these Acts, FT has a responsibility to perform its functions in accordance with sound commercial practice. This includes managing forests in a sustainable manner and not breaching contractual commitments.
Clause 12C of the Forestry Act deals with Ministerial Directions and Clause 65 of the Government Business Enterprises Act deals with a Ministerial Direction to perform community service obligations.
The decision to support the IGA will require some form of Ministerial Direction. If the government instructs the Board to do something that the Board cannot do, then the Board can object in writing to the government, and if there remains a standoff, the government must then lay before both houses of parliament its instruction and the board’s objection.
Where it then goes is anyone’s guess. From here, how does parliament resolve the matter? The Legislative Council has already held an inquiry and recommended against any further reservation of forest or transition out of native forest, so no legislation will pass. The government could consider sacking the Board. But what does that achieve? And where will the Commonwealth, another signatory to the IGA and the major provider of funds, stand in all of this? More twists and turns to come.
We live in interesting times.