OK - it goes like this - VicForests haven’t made a cracker since they started operations in 2004. In 2008 they put $127 million through their books and the expenses were $132 million = $5M loss. But they were given a $5.7M handout to cut down ash forests in the fire areas (not all this ash was burnt from several accounts). So they claimed they made a half million profit.
VicForests is a total basket case and have relied on cooking their books since their inception. If it were a private company they'd have been in the hands of receivers long ago. It's only because the government keeps throwing our money at them to knock down public forests that allows them to pretend they're profitable.
Since VicForests made the case to ‘salvage’ ash forests, half of the state’s woodchips have come from these beautiful tall mountain ash forests as supposed ‘fire salvage’. And the ratio is 1:8 sawlog to pulplogs coming from these areas despite the high quality trees being cut down. They are smashed on site to generate quick woodchip sales.
In an interview with the head of VicForests in Gippsland, Barry Vaughan made some comments worth bottling.
The best of which is:
“That we've inherited an asset which is not inherently profitable and continued land use decisions makes it more and more [of a] challenge to actually break even or make a modest profit, so we are not inheriting an asset which is inherently profitable.”
He also admitted they were 20,000 ha behind on getting clearfelled forest areas to regrow again. That means conversion to plantation type stands of species by aerially sowing with one or two tree species. He tried to explain they used ‘biological targets not an area target’ to determine regrowth success. This makes no sense but it is VicForests talking. Barry Vaughan also told the Gippsland audience that they aerially sow a selection of species including non-merchantable species. But from our years of checking these things, Barry Vaughan could be colouring brightly.
It was admitted that in the past DSE and treasury gave VicForests additional funds. As well there is an agreement about standing trees that would normally be paid for - they would be free - about $3million worth. Then there are the bushfire funds to offset the cost of taking all that burnt and unburnt ash.
When asked if bushfires could be relied on to fund their operations in the future he said that VicForests shouldn’t just be seen as a business, they also keep tracks open and give some blokes work. But when questioned about the main purpose of VicForests - to make a profit - Barry Vaughan had to admit they didn’t.
So why Mr Premier Brumby and Mr Treasurer Lenders, is this conniving, welfare dependent institution allowed to continue? Maybe write to the treasurer and ask him.