Mercury
FIA boss hits out at settlement NICK CLARK | September 15, 2011 12.01am
THE Forest Industries Association of Tasmania yesterday attacked the doubling to $23 million of a settlement payment to Gunns Ltd for ending native forest logging.
Chief executive Terry Edwards' reaction was in contrast to conservation groups which welcomed the resolution of the standoff since Gunns rejected an offer a fortnight ago that paid Gunns and Forestry Tasmania $11.5 million each.
Mr Edwards said he was concerned where the extra $11.5 million for Gunns was coming from.
"Who has been robbed? Does it come out the pockets of contractors, ex-Gunns employees, sawmillers who may exit the industry or from the regional areas that will be affected by this agreement?" he said.
"Why was the Premier's $23 million ceiling exceeded when Treasury said there was no basis to pay anything?"
The Australian Conservation Foundation, The Wilderness Society and Environment Tasmania said the move was a critical step towards the protection of 430,000ha of native forests and providing transitional support for timber workers and contractors.
"This settlement frees Tasmanians from an obligation to provide large volumes of native forests to Gunns or any other logging company," Environment Tasmania director Phill Pullinger said.
The Tasmanian Forest Contractors Association welcomed the settlement saying it would allow $45 million to flow to forest contractors.
"Many contractors are currently on the verge of total financial collapse with banks and other creditors about to commence liquidating personal assets," chief executive Ed Vincent said.
"We are hopeful that this announcement will give them some heart and the encouragement to keep fighting to stay afloat until the funding is made available."
Federal Coalition forestry spokesman Richard Colbeck said Gunns Ltd had been paid for something it voluntarily relinquished while contractors continued to languish.
Gunns said it would update the ASX today.
The company's shares have been suspended at a record low of 20.5 cents since August 4.
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