SOUTH EAST FORESTRY PARTNERSHIPS PROGRAM

Mr PEGLER (Mount Gambier) (14:16): My question is to the Treasurer. Treasurer, now that Carter Holt Harvey has rejected the government's $27 million assistance package, can you inform the house about the government's decision on this funding?

The Hon. J.J. SNELLING (Playford—Treasurer, Minister for Workers Rehabilitation, Minister for Defence Industries, Minister for Veterans' Affairs) (14:16): Today I am pleased to inform the house that the government has made available to the forestry industry of the South-East of South Australia an industry co-investment package of up to $27 million through the South East Forestry Partnerships Program.

As you are aware, the government recently sold the rights to ForestrySA standing timber, including the next three forward rotations of South-East forests, to OneFortyOne Plantations Pty Ltd. After discussions with many interested parties in the South-East about assistance to provide long-term investment to overcome the short-term cyclical issues currently facing the timber industry, the government has concluded that any application process for funding from the government ought to be made available to all South-East sawmilling industry participants who meet the government's criteria.

SEFPP is a merit-based state government grant program with an emphasis on capital investment. It is accessible by eligible applicants in the South-East who have, or are able to enter into, contractual relations to purchase timber from the new owners of OneFortyOne. It is aimed at improving the productivity and sustainability of the forestry products industry in the South-East by encouraging a viable and strong timber sawmilling industry that utilises efficient manufacturing methods.

It is intended that these efficiency improvements would enable the industry to better withstand short-term cyclical downturns that are presently being felt. Funding of capital upgrades must be of new projects starting from 5 November this year. The broad objectives are to encourage forest utilisation to promote regional economic development and contribute to a sustainable workforce.

This may be achieved by initiatives that support further value-adding along the timber supply chain, support innovation in the introduction of new technologies, attract further investment into the region, attract or develop new skill sets and career opportunities, and to develop renewable energy opportunities. It is envisaged that the applicant's cash contributions must match or exceed the government's grant contribution.

Full details of the co-investment funding program can be obtained from the Department for Manufacturing, Innovation, Trade, Resources and Energy or by visiting www.dmitre.sa.gov.au. The government is confident that this program will enable the local forestry industry in the South-East to compete more competitively in the world market and to protect and sustain the long-term future of the industry for generations to come.