NSW Minister for Primary Industries Katrina Hodgkinson announced that the NSW Government is to make Forests NSW a state owned corporation (SOC). In NSW there are 540 state forests covering an area of around 2.2 million hectares. Sources: Timberbiz, ABC North Coast NSW, The Sydney Morning Herald
According to the government, Forests NSW will remain publicly owned and the nature of the business and business relationships will remain largely the same but the governance structures will change to improve the organization’s commercial performance.
Not surprisingly the opposition does not agree saying that Forests NSW should be subject to more ministerial guidance not less.
“The decision to corporatize reflects the government’s recognition that there is much room for improving the financial performance of Forests NSW and delivering better returns to the community,” said Minister Hodgkinson.
Forests NSW has assets worth about $1.6 billion and harvests more than 2.5 million cubic metres of logs and more than 1.5 million cubic metres of pulpwood each year.
“As a state owned corporation under the direction of a skilled commercial board, Forests NSW will be able to focus sharply on its core business of growing and harvesting timber to meet the community’s needs for hardwood and softwood products while still providing recreational opportunities for the people of New South Wales.
“The Government recognises the important ‘public good’ roles of Forests NSW as a fire fighting agency, a provider of recreational opportunities and the part it plays in feral animal control,” said Minister Hodgkinson.
The changes are similar to those introduced into other publicly owned trading organizations such as Sydney and Hunter water corporations. There are no employment level changes proposed as a result of the organizational change.
However, a union source told the Sydney Morning Herald that the announcement was the ”first step to privatisation” and there were fears the government would seek to shift workers from the NSW industrial relations system to a federal award. The Australian Workers Union is in negotiations with the government over the renewal of its award.
Under the proposed SOC all the current wood supply commitments of Forests NSW will be transferred to the new corporation and will continue to be underwritten by the Government.
“The Department of Primary Industries will handle all policy matters related to forestry and together with the Environment Protection Agency and Office of Environment Heritage will provide an effective regulatory framework for the State’s forestry industry, including Forests NSW,” said Minister Hodgkinson.
“There will be no reduction in the regulatory oversight of Forests NSW and the Government will ensure that the State’s commitments under the Regional Forests Agreements are met and that the expected environmental benefits are realized.”
The Minister emphasised that the proposed structural changes would involve consultation with relevant stakeholders
Forests NSW is planting around 10 million trees across NSW in the 2012 planting season, which will ensure an ongoing timber supply for its customers and a strong long-term future for regional communities which depend on the timber industry.
