Letter to Wayne Swan

Rt Hon Wayne Swan
Treasurer
28 November 2007

Logging subsidies are detracting from health & education

Mr Treasurer,

Congratulations on being returned to government.

Our organisation, A Better Australia, has been representing a number of community-based groups to understand the impacts and costs of the pulp mill proposal and the community is now concerned at both the sheer scale of the total subsidies provided for pulpwood and the horrendous and unmeasured opportunity costs as our food production industries are taken over by low productivity trees.

If a ‘world scale’ pulp mill is to go ahead in the Tamar valley, we believe that the financial and opportunity cost implications need to be understood in advance. No studies of these factors have been conducted and simply accepting the Howard government’s decision could place your government in a serious financial jam.

Therefore we write to urge you to commission, or support, an independent study of both opportunity and total subsidy costs.

The level of subsidies enjoyed by the pulpwood industry in Tasmania is of great concern. These subsidies in the form of cash payments or cost relief, appear worth over $200 million each year and are now to be topped up with mill based infrastructure costs of over $200 million dollars (roads, rail etc). All of this at a time when our hospitals, schools, social services and other basic services are being starved for lack of funds. This bias is threatening people’s lives and health. It is therefore an issue that isn’t going to go away.

A large part of the total subsidy comes from federal tree plantation MIS that have the taxpayer helping to fund the conversion of individually owned food farms to corporate ownership as tree plantations. Gunns gets about $60 million per year from those programs, and ends up owning massive amounts of land at taxpayer/investor expense. No subsidies were modelled in Gunns economic models with their IIS therefore they must be operating on the assumption that they will continue for the life of the mill, or that they just don't know about them.

The socio-economic issues alone would have stopped the proposal dead in its tracks except for the gross corruptions of process and representation that have left all that information out. The idea of leaving out all costs, impacts and risks to Tasmanians and only portraying the positives is an absurd methodology that most people wouldn’t even apply to the purchase of a car, let alone a massive industry. It exposes everyone to far too many risks.

I trust that you find the materials useful and informative. We can answer queries and supply further information should you require it.

Sincerely,

A Better Australia