What Agreement?

To more clearly understand the events of last week, it is helpful to return to the document known as the Intergovernment Agreement (IGA), signed by the Commonwealth and the State Governments in August 2011.  This document was inspired by the deliberations of a self-appointed group representing various interests in the forestry debate, from industry and the conservation movement (the parties).  These parties originally came together to resolve issues surrounding the Gunns pulpmill, however they soon determined a broader purpose, which was coined “the Tasmanian problem”. 

The IGA provided a number of guarantees.  For industry, it guaranteed, like agreements beforehand, a level of wood supply and peace.  For the conservation movement it provided for a further significant transfer of forest into reserves.

Noble as its intentions were, the Agreement could not deliver both – the resource was simply not big enough. This was shown by the failure of the Verification Panel, set up by the IGA headed by Jonathan West, to satisfy both demands.

The governments then called on the parties to the earlier deliberations to reconvene and see whether they could work out a compromise.  For industry it meant a further reduction in wood supply, and for the conservation groups a reduction in their claims.  To assist these deliberations, the Federal Government advised it was prepared to fund a buyout of sawmill quotas, thus assisting the industry to reduce its demands.

After a considerable amount of deliberation, an agreement - including a range of “durability” clauses - was reached between a number of the parties, the announcement was made with the appropriate fanfare, and legislation presented to Parliament.

Sounds good so far - or does it?

At the start of this process, under the Tasmanian Regional Forest Agreement, industry had a guaranteed wood supply of 300,000 cub m per annum of sawlog, 265,000 tonnes (cub m) per annum of peeler billets (for Ta Ann), and access to 12,500 cub m per annum of specialty timbers.  The decision by Gunns to withdraw from native forest operations meant a reduction in the existing demand for sawlog to around 155,000 cub m., a decision having been made for Gunns to be compensated in cash and debt forgiveness for “handing back” its contracted amount.  A poor decision, one that has been commented on previously.

These figures were guaranteed by the IGA.

The buyback provisions have enabled a number of operating sawmillers to express an interest in exiting the industry, thus enabling the existing sawlog supply arrangements to fall further, to around 137,000 cub m., and this is the figure now agreed upon.

I use the word “existing” advisedly – the resource is there but none of the present millers have access to it, or contracts for it.

The requirement of Ta Ann for 265,000 tonnes has been reduced to some 160,000 tonnes.  Compensation for this reduction still needs to be determined.  Who pays?

And the access to specialty timbers has been reduced significantly from 12,500 cub m per annum.

For the conservation movement, the initial ask of 572,000 hectares of “high conservation value” (HCV) forest was to be determined by an Independent Verification Panel.  An area of 430,000 hectares was to be immediately set aside, while the overall claim was being verified.  It needs to be noted here that the West panel did not deliver in its verification of this claim.

The agreement provides for 395,000 hectares to be immediately made into reserves, with a further 108,000 hectares in 2 years time, as long as there has been “peace” in the intervening periods.  That makes 503,000 hectares.  Still no definition of HCV.

A further gain has been 21,000 hectares to be reserved after existing logging has been completed and 37.000 hectares where limited access only will be provided for specialty timbers.  However, the conservation movement do not consider these to be gains.  If not, then why add it?

As a bonus, they get the breakup of FT.

And an agreement from all parties to now support FSC certification of the remaining forest, with forest practices no different to what has occurred to date.  It says a lot for the corrupt nature of FSC certification.

So, back to the parties.  One party (Timber Communities Australia) has not signed as yet - it needs a plebiscite of its members before so signing - and the TSA (Tasmanian Sawmillers Association) has signed it, only to discover it also needs a plebiscite of its members.  It remains to be seen whether these plebiscites will deliver.  I suspect the TCA vote will be a negative, and some TSA members have expressed concern regarding the payout provisions.

The conservationists at the table don’t represent the broader movement.  Although signing off on the durability (ie peace) provisions, a number of groups (eg the Tasmanian Conservation Trust) have expressed concern over the agreement, protest groups have already stated they will not be bound by the terms of the “agreement” and continue protesting for the cessation of all native forest logging, and one of the signatories, Vica Bayley of the Wilderness Society, is scheduled to speak at a forthcoming Tarkine rally in Hobart.  Peace in our time?  Hardly!

And sitting above all this is a government which has stated it will not make decisions regarding its (ie our) resource, but will be guided by the (self-appointed) parties.  However, in a rush to meet a deadline for the receipt of Federal funds (for regional development projects, as yet undetermined) it has pushed legislation through the Lower House of Parliament, without having the full support of the parties.

What happens if the TCA vote is a negative – too bad!  What if the durability clauses don’t hold - too bad!  What happens if the compensation for sawmill buyouts is insufficient – too bad!  What happened to their workforce – too bad!  What happens if conservation groups not party to the “agreed” position continue to agitate for more areas to be reserved – too bad!  What happens with the Guarantee for Ta Ann – too bad!  What about the users of specialty timbers  -  too bad!  And the private forest owners – too bad!

How much compensation will be required? Who knows?  And what if the Legislative Council in its wisdom decides to not accept the legislation?  Which is highly likely, at this stage.

I can see it now, a government hellbent on making no decision of its own, having abrogated its responsibility to an unelected cartel of self-interest, blaming all and sundry for not delivering on its desire to access the paltry federal funds being placed on the table, and passing the buck for whatever economic and social fallout.

In negotiating parlance, what government has done is confused objective (ie a viable industry, and peace), with strategy (the IGA).  Strategy has become the objective – and has failed.  Why? Because it has weakened industry and not delivered peace.  A flawed process, a flawed outcome, a flawed piece of legislation.

As commentator Bruce Felmingham has indicated:  Real leadership is in short supply.