Open Letter to Prime Minister Rudd, 27th November 2007
The Rt. Honourable Kevin Rudd
Prime Minister of Australia
27 November 2007
Why have the socio-economic costs of the pulp mill been hidden?
Dear Prime Minister,
Congratulations on your win. It is encouraging that Australians have voted for a change in direction and for a brighter future than we might have expected under John Howard.
A Better Australia is an organisation designed to represent a coalition of community interests actively seeking a better Australia. We represent investors, farmers, restauranteurs, shopkeepers, business owners, fishermen, labourers and others that have substantial investments in Tasmania and whose voices have been stifled by our own governments.
We totally support your stated priorities of dealing with climate change, water shortages, health and education, small business and food prices in a socially inclusive way.
Unfortunately for us all, Howard and Lennon’s truncated ‘approval’ process for a pulp mill in Tasmania is contrary to every one of those priorities.
On behalf of the community, we write again to point out that the governments of Australia have taken tax and other monies, denied the community any help or scientific support to protect them while subsidising the project proponent to nearly $15 million to prepare, and market, their proposal.
We argue that the approach was biased and illegitimate as was the consequent decision because major impacts on the community were deliberately ignored by those that we are paying to represent us. Simply, they refused to do the jobs for which we are paying them despite the fact that the risks appear dire and would threaten a large community of Tasmanians.
We absolutely reject this means of deciding our future which disrupts our investments, our hopes and our plans, all for the sake of satisfying one company that is already in receipt of massive subsidies. A petition of about 22,000 signatures demanding a return to due process was delivered to our Upper House but it, like all community communications, was entirely ignored by the government.
We support you in your agenda for Australia. We need inclusive government that understands our environment, understands critical resource constraints, understands the unique needs of its people and takes all reasonable steps, including open planning, to protect the people – including having mechanisms to protect us from bad government. In the mill issue, we are seeking a way forward that deals openly and honestly with the potential impacts and problems so that everyone can decide how best to prepare for the future.
Under your policy of social inclusion, we are asking that the impacts on, and the needs of, taxpayers’ be taken into consideration now, before any more damage is done. The ‘approval’ process has always excluded the biggest impacts of a ‘world scale’ mill - wood supply. The result has been to leave out massive social and economic costs and to create an artificially positive picture that advantages the project proponent at the expense of the community. The forest clearance rate proposed will be one of the highest in the world, and the threats to our food producers from the tax driven conversion of farms to plantations are dire and immediate.
Overall, the mill proposal threatens:
- Adverse climate change impacts (e.g. cutting and burning forests)
- Major economic threats from unstudied opportunity costs (e.g. loss of farms)
- Water availability as thousands of hectares of tree plantations suck catchments dry
- Rural food production industries as food farms are replaced with MIS trees
- Rural communities whose cash flow is drying up as trees take over
- Small businesses in tourism, farming, fishing, recreation and fine foods that rely on clean and green
- Health and education as hundreds of millions of dollars of public money are diverted to subsidise the pulpwood industry
Decisions based on information
All community impact assessment was carried out by the proponent without any independent verification. Independent experts have consistently found severe problems and threats with the proposal yet all have been ignored. The final indignity was when the Lennon government abandoned the RPDC process before public hearings and when Gunns had been reported to be 'critically non-compliant' with RPDC requirements. The bias then introduced into the process places whole communities and industries at risk and their voice has never been heard.
We write to ask that you cause to be conducted a professional, public and independent socio-economic cost analysis of the Tamar pulp mill proposal that identifies all likely impacts of the mill on the people of Tasmania, including opportunity costs and total subsidies needed. This will then balance the ITS Global benefits study commissioned at our expense by the State government. Only after such information is available can the government, and businesses and communities, plan for the project in any balanced, useful or informed way. It will also clear the air and introduce a definitive set of information that everyone can have access to.
This is a path to heal the divisions created in Tasmania by the biased and bullying way that this project has been foisted onto the public so far.
This then is our appeal to you. We don’t ask that the mill approval be cancelled. We ask that no further steps are taken with it until, and unless, a reasonably complete picture is obtained by independent and qualified experts. The purpose is to arm our governments to act to protect any threatened industries and populations.
We have attached various other descriptions to emphasise what we are saying and trust that they may be helpful to you in understanding the communities’ situation.
Should you, or your officers, require further information our web site contains various links. We have also included some additional relevant links below.
Yours truly,
A Better Australia
See additional support information below
Social exclusion is State’s approach
The community does not believe there is any legitimacy in a decision made by project participants when the risks to, and needs and investments of, tens of thousands of taxpayers are left from all consideration first by the project proponent, and then by the government, the opposition and both major political parties.
The exclusion was exacerbated by the community being refused all funding or assistance to mount a case or to research critical vulnerabilities. The state government marketed the project for the proponent leaving no-one to act on behalf of the community except the community itself. We were left to fund our own submissions, then our input was ignored when the state government disrupted the agreed process before public hearings took place and after the proponent was found to be critically non-compliant with the RPDC process.
The federal process was reasonable but only explored about 5% of the whole proposal. The Scandinavian pulp mill supplier, Sweco Pic, that Lennon engaged to conduct the ‘approval’ decision only explored about 8% of all other impacts leaving some 85% of the impacts unexamined and largely unregulated. The author of the mill guidelines (Miotti) stated through now independent Tasmanian MLC Terry Martin, that the mill failed 13 of the guidelines. See article excerpts below. Now it is we, the ignored communities living in the mill’s ambit who must bear any adverse impacts or leave the area.
It seems very unlikely that this issue can be resolved without full information about the proposal and its impacts. A professional socio-economic cost study could be conducted in a few weeks by a competent independent party (e.g. Sydney University) and the new federal government would then be armed with useful information to deal with reported impacts and community disquiet.
Some reasons for community disquiet
Our governments are denying the population effective representation or support while paying massive subsidies to the mill proponent.
Our food production sector is at obvious risk from subsidised conversion of farms to tree plantations. State planning laws are being published that act to drive farmers off the land (e.g. PAL Act that prevents farmers from living on their own land, excessive rateable land valuations and high charges for water) while the logging industry's every requirement seems to be met at public expense.
This at a time when our hospitals, care services and schools are being starved for funds and people are literally dying or being denied care due to lack of money.
The gross asymmetry of representation and funding is a constant reminder to Tasmanians about who really seems to run the State.
Huge subsidies to pulpwood industry detract from other services
The logging industry is already receiving mixed subsidies and cost relief to the value of over $200 million each year while our hospital and school systems are falling apart for lack of investment. Since Gunns only posts profits of about $80 million each year, it’s clear that without the subsidies and cost relief, they would be running at an unsustainable loss.
Total subsidies and cost-relief to the pulpwood industry appear to be worth over $200 million per year, which monies would deliver far more jobs and far greater benefits if spent on hospitals and schools. Further subsidies for infrastructures like rail and road add another $200 million capital cost plus recurrent maintenance to that figure.
In addition, the Tasmanian logging industry operates under different laws to the rest of us which effectively isolates them from community needs and from any public accountability for their actions and the consequences on the wider community.
Of course Gunns wants a pulp mill. It will probably lock in their subsidies for the next 20 years and anybody can make a profit from generous subsidies. By insisting that the community represented itself, the government forced people to study more than they ever wanted to know about the impacts of pulp mills compared to the promises that were offered. The population now knows more about those impacts than our politicians. The result cannot be ‘smoothed over’ with nice words. Only information and guarantees of community protection are likely to work. In other words, take a responsible government position, conduct an independent study of the issues and only then, make a decision that will affect us for a century to come (normal life of a modern pulp mill).
Healing the divisions
Various politicians and others have talked about ‘healing’ divisions created by the pulp mill proposal and the truncated process that supported it while keeping out the public. The thousands of people left from consideration can hardly ‘forgive and forget’ when they are looking at potentially massive impacts on them for which the state government, through its self induced ignorance, is entirely unprepared. Rapidly dropping property prices in adversely affected regions is but one such impact.
This is not a useful way forwards. People have lost a lot of their trust in government, at both the state and federal levels.
That trust is best restored by engaging with the community, assuring that government is fully informed about community impacts, and giving priority to dealing with impacts identified. This cannot happen as long as the impacts are being institutionally ignored.
We therefore argue that a full, public and independent study of the impacts of a ‘world scale’ pulp mill, in that location, be conducted to deliver a balanced view against all of the positive ‘benefits’ information so far developed.
Threats to food production and rural industries
The mill will need an additional 200,000 ha (total 400,000 ha) as plantation feedstock and may need significantly more to feed itself for 100 years if regrowth rates are slow. A significant percentage of that plantation estate is coming from our food producing land, which is rapidly being converted to trees courtesy of federal Managed Investment Schemes that give tax incentives to tree investors. That land use conversion is being supported by a logging industry that is making huge up-front profits from the schemes - the taxpayer component alone has been valued at about $3,200 per hectare. These subsidies are causing the pulpwood industry to always be able to win any competition for scarce land, water or other resources. Trouble is also in store as the conversion is nearly irreversible because trees deplete the soils so much, plus timber reserves are legally 'in perpetuity' in Tasmania.
Large areas of rapidly growing tree plantations consume large amounts of water from catchments, about 2Ml/ha more than normal agricultural uses. Tasmania has been suffering declining rainfall for a decade, many areas have been declared in drought. Our food producers must pay for their water use, yet tree plantations do not pay for the hundreds of gigalitres of water that they take from our catchments. As plantations take more land, so our food farmers find they must pay more for an ever diminishing water supply, or that there simply isn’t enough water left for food production. If food producers could buy water through forestry they'd get it for about 1/4 the price!
As plantations take over our scarce food producing farms, rural income is dropping and many of our critical rural amenities (stock yards, slaughterhouses, vegetable packers) are being pushed closer to closure. Rural centres are losing cash flow as no annual income is obtained from trees. The loss of our food production industry is a serious strategic threat to Australia’s independence, yet it has not even been acknowledged as an issue in the ‘fast-track approval’ process.
The government free market fable of a ‘level playing field’ is risible when farmers and food producers are disappearing because they cannot compete with a self-policing, highly tax subsidised corporation that operates under a totally different set of laws and standards to everyone else and that gets all its plantation water (about 400 Gl/yr) free.
Threats to other industries that rely on Tasmania’s image
Many rural centres have been attractive to tourists yet even these opportunities are under threat from the increases in log traffic and the scenic disruption caused by clear felling and napalming of both forests and animals. Other threats include toxins and biocides, used to kill various pests in tree plantations, that find their way into catchments and threaten human and animal health downstream.
The mill area in the Tamar valley could easily become depressed, particularly if the forecasts of independent pulp mill experts like Warwick Raverty (ex RPDC pulp mill expert) come to pass. The state guidelines for the mill do not offer any protection from smells, one of the most hated outputs of pulp mills. According to Dr Raverty, the smells are likely to be severe, extensive and totally appalling to most of the population. Any such smells would likely destroy most of the Tamar’s appeal to tourists, shatter businesses and disrupt the lives of thousands of residents. See also submission 114 by actuary Naomi Edwards at Actuary submission to RPDC here
Exposure of Tamar residents to health and other risks
The AMA has identified many risks in their submission to the RPDC (ignored in the new process) which stem from the airshed over Launceston often retaining high levels of particulates due to the inversion layer in the Tamar valley. These risks are outlined in the AMA submission 473 to the RPDC at AMA submission to RPDC here
Economic threats
The Tasmanian logging industry has received remarkable amounts of subsidies from all levels of government. Gunns 200,000 ha of plantation to date will have brought them about $640 million in income to date, plus helped to transfer the ownership of that land from ordinary Tasmanian ownership to Gunns.
The industry received about $280 million in 2005 for ‘restructuring’ yet much of that money has reportedly gone to simply cutting logging industry costs, like putting roads through our few remaining wilderness areas.
Gunns has also been given about $11 million to help them with their mill proposal plus the state government funded a pro-mill marketing 'bus' and a pro-mill task force to help push the proposal through.
Apart from these kinds of subsidies, Tasmanian loggers enjoy huge cost relief courtesy of the taxpayers. Tasmania’s logging industry does not pay for road and bridge maintenance yet their trucks cause most of the damage to those infrastructures. Ordinary ratepayers must pay all of those costs via local rates.
Tree plantations use 2 Ml/ha more each year (D. Leaman) than agricultural uses yet the plantation owners do not pay for that water. When catchments are under pressure for water, plantations lower the availability and quality of water downstream, which puts upward pressure on prices. Farmers and food producers have no way to gain a fair deal when they’re competing with a tax subsidised corporation operating under a different set of laws.
Forestry Tasmania works mainly for Gunns, their monopsony buyer of timber. Those activities cost Tasmanians around $50 million each year.
Hidden ‘land swaps’ are being reported where crown land was ‘laundered’ through FT before being given to members of the forestry industry. This has been conservatively valued at $200 million. See Illicit land swap described here
See also UTAS Tom Baxter's thoughts here
Wood supply agreement
Given Lennon’s track record, many Tasmanians are deeply suspicious of an all encompassing, 20 year wood supply agreement being negotiated, in secret, by Bob Gordon of Forestry Tasmania dealing with its monopoly customer, Gunns Ltd. The public needs to know the details and implications of these deals before we are committed to them by signature. As it stands it sounds like the taxpayer will take all of the risk, while the proponent takes all of the profit.
We argue that no such deal should be struck until after reasonable public inspection.
If the $16 tonne figure for FT pulpwood is correct, then the trees could be sold for ½ of their value as carbon sinks. Cutting our forests down for pulp is entirely inconsistent with any strategy to reduce global carbon dioxide and would reduce Labor’s environmental credentials to a sham. It would do nothing to address the huge divisions in Tasmanian society created as loggers line up to take over our scarce resources using taxpayer subsidies.
Relief from laws
Tasmania’s logging industry doesn’t work to the same set of planning and environmental protection laws that apply to the rest of us. They are relieved from Wildlife and Conservation Acts, Planning Acts and Natural Vegetation Acts, as well as from Freedom from Information. They are ‘self-regulating’ and virtually entirely unresponsive to community difficulties that they create.
See for example Lawyer's comments here
This relief not only give the logging groups a huge competitive edge over everyone else, they also make it virtually impossible for everyone else to get any kind of accountability from the logging industry.
Corruption
There have been many, and growing, calls for some Commission against corruption to explore the relationship between the logging industry and government in Tasmania. See article by Richard Flanagan "Out of control" here
In the wider use of the term corruption, there seems little doubt that the system used in Tasmania to approve the mill, was itself corrupt. It violated the principles laid down in our own planning laws, created two sets of laws specially for Gunns pulp mill, used a Swedish pulp mill supplier to do the 'approval', left the public out of any hearings while using the public's money to advantage the proponent.
Whether there has been corruption in the narrower sense is for others to decide. Whatever the case, an independent analysis of the likely real costs and impacts of the pulp mill proposal can only help clarify the situation and deliver more choices for a better future.
See article by MLC Norma Jamieson here
Excerpt from The Examiner 29 August 2007 re petition and failure to meet guidelines
State's eyes on MLCs
...Mr Parkinson talked up the benefits of the project on the State's economy and maintained the mill would be environmentally sound.
...However, former Labor MLC Terry Martin, who was kicked out of the PLP for voting against the alternative assessment of the mill, raised new concerns.
Mr Martin, who indicated he would not support the mill permit, commissioned a report from a scientist who worked on the RPDC guidelines. He said the report's author, Dr Roberto Miotti, found that the project did not comply with 13 areas of the guidelines.
...Before the debate, Mr Finch presented a petition of 21,020 people opposed to the mill.
This last was a typical misreport...here is the petition wording
PETITION TO RESTORE DEMOCRATIC PROCESSES
To the Honourable President and Members of the Tasmanian Legislative Council, in Parliament assembled
The Petition of the undersigned Citizens of Tasmania declares that, in relation to the pulp mill assessment, your Petitioners want the protection of due process, a return to public participation in planning, and equal treatment for all.
Tasmania’s state government is exposing Tasmanian communities and industries to serious risk by abandoning due process and by failing to conduct proper risk and cost analyses of the proposal. These actions result in an unrealistic one-sided evaluation that shows false economic promise and creates a dangerous precedent for planning.
Studies show that Tasmania could lose much more than it stands to gain if forest, farm land and water resources are provided preferentially to a pulp mill, and/or if the Tamar air-shed and Bass Strait become polluted. We citizens and our children will carry the burden of such costs and risks for decades to come.
And your Petitioners request that the Legislative Council refuse to approve any pulp mill until a complete and independent study of the risks and costs to other industries and communities has been conducted (to Australian risk assessment or federal Treasury standards and including the likely total costs of all subsidies); and made public and properly debated in the Parliament.