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Article from: weekly times

Gunns' collapse to hit farmers

September 28, 2012





FARMERS are facing losses of $200 million in the wake of this week's Gunns Limited collapse.

Westbury grazier Dimity Hirst was yesterday contemplating the likely loss of her young family's home, livelihood and savings.

Mrs Hirst, wife of pro-forestry campaigner Michael Hirst, said hundreds of land owners would be bracing for what could be the state's greatest rural upheaval since the apple industry collapse in the 1970s.

"It's out of our hands. It's terrifying," she told The Mercury.

About three years ago, the Hirsts leased 200ha of their farm to Gunns, for a eucalypt pulpwood plantation.

If, as feared, Gunns defaults on its lease payments, it will wipe out the family's primary means for paying off their mortgage.

Tasmanian Farmers and Graziers Association chief executive Jan Davis said the problem could be repeated across hundreds of farms, leaving land owners with worthless trees which, at an estimated cost of $15,000 a hectare, would be too expensive to remove.

And even if a pulp mill ever got going, she said it was unlikely to happen fast enough to save land owners with semi-grown trees, with Gunns' regular payments the only secure income for many.

Others have counted on them as superannuation to support older generations.

Mrs Hirst said such pressure threatened to destroy families and trigger a mental health crisis and she warned the State and Federal governments they could expect uproar, driven by financial pain and triumphant smiles on Green politicians' faces.

"I'm so angry, it's so unnecessary," she said.

Ms Davis said farmers sucked into the Managed Investment Scheme tree-planting frenzy that transformed the Tasmanian landscape during the 2000s had been treated appallingly.

She said the banks that funded Gunns' MIS adventure expected to get their money back, but it appeared Tasmanian farmers would be left with a $200 million black hole.

Meanwhile, 50 redundant Gunns employees will today be paid more than $1 million in entitlements packages, despite being told on Wednesday that the money was not there.

Construction, Forestry, Mining and Energy Union assistant secretary Leo Scourdoumbis said the ANZ Bank had intervened to ensure the workers would be paid on time.

Federal Employment Minister Bill Shorten yesterday flew to Tasmania to help secure employee entitlements and said he was pleased with the ANZ decision.

The move meant there was no need for a taxpayer-funded contribution from the General Employee Entitlements and Redundancy Scheme.

Mr Shorten met receivers KordaMentha, Deputy Premier Bryan Green, CFMEU representatives, federal Lyons MP Dick Adams and member for Bass Geoff Lyons, yesterday afternoon and said all were hopeful of finding buyers for Gunns' interests to safeguard the jobs of remaining employees.

"The attitude was this is a knock, but you don't give up," he said

"There's good business to be done in the timber industry down here."