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Wednesday, 16 August 1972
Page: 78


Senator JESSOP (South Australia) - 1 listened with interest to Senator Douglas Mcclelland, who has just resumed his seat. I believe that he mentioned something about unemployment in the particular industry. 1 would imagine that the Bill would alleviate unemployment in the areas which he mentioned, because the Government is providing $21m over the next few years to enable the States to continue planting pine trees on State owned land. I think we must agree that the Bill is a very worthy one. Contrary to what Senator Douglas McClelland said, it will be for the benefit of the people employed in this industry. 1 draw the attention of the Senate to tm plight of the private forestry sector. Private forestry is primarily a softwood proposition. That is how it is commonly considered in Australia. It can be divided into 3 categories. The first is farm forestry, which usually consists of the planting of pines on odd pieces of land which are normally unsuitable for any other purpose. That planting is done without the benefit of any professional advice and often without regard to the location of the markets. The second is investment forestry, which is usually effected by the sale of bonds or shares to the public. The temptation for the salesmen to exaggerate the returns to be expected, in order to induce sales, can be readily understood. In this area control may prove undesirable. The third is industrial forestry, which is the establishment by the timber industry of large areas of pine plantations to provide a source of raw material for the processing plants as an insurance against restrictions of large supplies from Government sources as a result of extensive destruction of forests by fire, wind, insects or disease. Staffs of professional foresters are employed to establish and manage these plantations. They have already established for their forest products a ready market situated within economic distances of utilisation plants.

It seems to me that the various governments should provide a forest service to advise the first 2 categories that 1 have mentioned on the suitability of the sites for growing pines and on the proper methods for the establishment of forests and their management. At present large numbers of professional foresters are being provided through the Forestry Department of the Australian National University. I do not see why these men should be made available solely to the State forest services, as is the case at present. I know that a certain number of these students have become available mainly to the industrial forestry companies. But I am concerned that practically none of the farm foresters or investment forestry companies apparently can afford to employ them. The State forest services so distrust the investment forestry companies that sometimes they will not even permit their forestry officers to advise such companies.

Under this Bill the Government is providing millions of dollars to enable the State forest services to expand the establishment and management of softwood plantations. Yet not only do these organisations have amply trained staff at the moment, but also they have many other advantages over private foresters. For example, the Government forestry departments pay no income tax or land tax. Certainly, private forestry is given some taxation benefits but these' are not equal to the tax free position of the State services.


Senator Webster - They cannot compete with them in commercial terms when the product is sold.


Senator JESSOP - I was coming to that point. I thank the honourable senator for reminding me. The State forest services are also free of local government rates which are tending to assume alarming proportions. Yet the private companies have to compete, as Senator Webster mentioned a while ago, with produce from the government forests. To plant 2.000 acres a year, even in the most economic conditions, would cost at least $100,000 each year without including the cost of the land, lt would cost about $200,000 properly to maintain the resulting forests at the end of the 1 5th year. The total investment to that time, without adding interest charges, would be about $2m. At the end of 35 years when these forests can be considered mature this amount would have more than doubled. It is an extremely expensive undertaking. I want this point to sink in.

When it is realised that from time to time these industrial companies must continue to install and replace the very expensive machinery necessary to process the ever expanding production from a developing forest, it will be seen how important assistance can be to them in their financial problems.


Senator Wilkinson - From what is the honourable senator quoting?


Senator JESSOP - I have a few notes that I put together for the honourable senator's benefit because these points are very significant to the people in the industry.







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