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House of Assembly - Fifty-Third Parliament, First Session (53-1)
2014-06-19 Daily Xml
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Forestry Sale

Mr BELL (Mount Gambier) (14:57): My question is to the Minister for Forests. Was the revenue that the government previously earned on its timber harvests enough to cover the interest on $670 million—the amount the harvests were actually sold for?

Members interjecting:

The Hon. J.W. WEATHERILL (Cheltenham—Premier) (14:58): This is a budget question and, sadly, we don't have our Treasurer with us at the moment, but he will be here shortly. Can I say that the decision in relation to the forestry sale was one that was in South Australia's best interests, and a premium price was achieved for that asset.

Members interjecting:

The Hon. J.W. WEATHERILL: I don't think there is any doubt. Indeed, given the risks associated with managing such a large estate—and we have seen, sadly, with the evidence before our eyes in relation to the Wirrabara Forest—the ever-present risk of bushfire means that the South Australian government would not have the asset or balance sheet capability to restore a forest in the event of a fire. It is in the long-term economic security interests of the South-East for that to be backed up by somebody with much greater balance sheet capacity. So, it is in the long-term interests of that forest.

It is in the long-term interests of the South-East that there was somebody that had the ambition and the balance sheet capacity to grow that business. The truth is, if we decided today, at this point, would we be in the business of forests, we would not take that step. It did make sense back at the turn of the century for state governments to take those steps, but it does not make sense for the government to apply its relatively rare balance sheet capacity to a business, essentially—the business of forestry.

It was a sensible measure. It had made good, prudent financial sense to engage in the sale, and we stand by that decision, but we also accept that the South-East has many opportunities as well as challenges. That is why I think $17 million has been allocated to future industry development in the South-East, carved out from the sale.

There has been some fantastic work done to realise some opportunities to add value to fibre in the South-East in a way which will create the jobs of the future based on advanced manufacturing opportunities. I think the best days are ahead of the South-East, and we think that there is a secure future for its forestry industry as part of that mix.

Mr WILLIAMS: Supplementary, sir?

The SPEAKER: Supplementary, member for MacKillop.

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