$34m to get Gunns out of forests

EMBATTLED forestry company Gunns has extracted $34.5 million from taxpayers in a settlement that clears the way for peace in Tasmania's native forests.

By InvestSMART · 15 Sep 2011

By InvestSMART ·
15 Sep 2011

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EMBATTLED forestry company Gunns has extracted $34.5 million from taxpayers in a settlement that clears the way for peace in Tasmania's native forests.

Gunns will be paid $23 million to extinguish its residual rights to timber contracts, Premier Lara Giddings said yesterday.

Another $11.5 million would go to settling the company's disputed debts to state agency Forestry Tasmania.

The deal seals the company's exit from native timber logging and opens the way for protection of public forest where conservation battles have raged for a generation.

It was a long-awaited third milestone in a historic peace process that began nearly a year ago. Gunns turned down an initial offer that was $11.5 million lower.

Ms Giddings said the "resolution means that we have avoided the lengthy delays and costs that would inevitably be incurred if these issues were pursued through the courts".

In the next phase of the peace talks, a panel of experts will decide which forests will be protected because of conservation values, and which would stay open for logging.

Forestry Tasmania has claimed that at most it can only afford to protect 300,000 hectares and still meet other wood supply contracts.

The Greens, who hold Ms Giddings' minority Labor government in power, backed the deal. ANDREW DARBY

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Frequently Asked Questions about this Article…

What is the $34.5 million Gunns settlement and who paid it?

The settlement is a $34.5 million taxpayer-funded deal that clears the way for peace in Tasmania's native forests. It pays Gunns to exit native timber logging and resolves disputed claims involving the company.

How is the $34.5 million settlement for Gunns broken down?

The deal pays Gunns $23 million to extinguish its residual rights to timber contracts, and a further $11.5 million goes to settle disputed debts the company had with the state agency Forestry Tasmania.

Why did the Tasmanian government describe the Gunns resolution as preferable to going to court?

Premier Lara Giddings said the resolution avoids the lengthy delays and additional costs that would inevitably have been incurred if the issues were pursued through the courts.

What does the Gunns settlement mean for native timber logging in Tasmania?

The deal seals Gunns' exit from native timber logging and opens the way for protection of public forests that have been central to conservation battles.

Who will decide which Tasmanian forests are protected after the Gunns exit?

A panel of experts will decide which forests should be protected for their conservation values and which areas can remain open for logging.

How much forest can Forestry Tasmania afford to protect while still meeting wood supply contracts?

Forestry Tasmania has claimed it can afford to protect at most 300,000 hectares and still meet its other wood supply contracts.

Did Gunns accept the first offer from the government?

No — Gunns turned down an initial offer that was $11.5 million lower before accepting the final $34.5 million settlement.

Which political groups backed the Gunns settlement in Tasmania?

The Greens backed the deal; they hold Premier Lara Giddings' minority Labor government in power, and the premier publicly supported the resolution.