Tasmanian Forests Intergovernmental Agreement

The Tasmanian Forests Intergovernmental Agreement will support the forest industry to progressively transition to a more sustainable and diversified footing and to build regional economic diversity and community resilience.

Signed by the Prime Minister Julia Gillard and Tasmanian Premier Lara Giddings on 7 August 2011 the landmark agreement will provide certainty for Tasmania’s forestry industry, support local jobs and communities, and protect more of Tasmania’s high conservation value forests.

It will help the forest industry adapt to market changes while protecting the communities and families that rely on the sector to survive.

Under the agreement a total of $277 million, including $15.5 million from the Tasmanian Government, will be provided in the following key areas:

  • $85 million to support forest workers contractors and their families affected by the downturn in the industry, and in particular Gunns Limited’s decision to exit native forest harvesting
  • $43 million to facilitate implementation of the Agreement
  • $120 million over 15 years, including an initial payment of $20 million to identify and fund appropriate regional development projects
  • $7 million per annum ongoing to manage new reserves
  • $1 million for mental health counseling and community wellbeing

An Independent Verification Group has been established to provide advice to the Prime Minister and the Tasmanian Premier on the verification of sustainable timber supply requirements and claimed high conservation values of forest areas including boundaries of proposed reserves from within the Environmental Non-Government Organisations (ENGO) – nominated 572,000 hectares.

On March 23 the Independent Verification Group, through its Chairman made public their advice to Government.


Background to the Agreement

The Tasmanian forestry industry is going through a process of structural transformation brought about by changing markets. The catalyst for a sudden structural shift is the decision of Gunns Ltd, the State’s major processor of both native forest sawlog and pulpwood products, to exit native forestry and to focus on its plantation based pulp mill at Bell Bay.

While other businesses could take up that part of the statutory minimum production of native forest sawlog currently used by Gunns Ltd, the Governments recognise that there would be ongoing market pressures. The issue of the balance between commercial use and environmental protection could also continue to divide the community, with reputational consequences for investment and economic growth.

As recognised in the community-driven Statement of Principles process, Gunns Ltd’s exit offers a unique opportunity for the Governments to support the restructuring of the industry towards future sustainability based on both public and private resource, create a significant conservation benefit by reserving and protecting High Conservation Value forest areas, and strengthen the partnership between the two Governments and other stakeholders to develop and diversify the Tasmanian economy, creating new sources of prosperity and opportunity for all Tasmanians. However, this opportunity also brings unique challenges ranging from getting the balance right, to mitigating the economic and social consequences on affected workers, their families and regional communities during a period of transition and economic diversification for Tasmania.

Some of the factors that have and are causing challenges in the industry include:

  • Reduced national demand for hardwood structural timber;
  • The collapse of a number of Managed Investment Schemes has resulted in reduced local plantation investment;
  • A significant contraction of traditional Japanese woodchip markets along with a stronger preference for plantation resources – Australia’s share of the Japanese market has reduced by 50% since 2008 and 25% in the last financial year;
  • Reduced prices in Chinese woodchip markets in comparison to Japan;
  • High Australian dollar leading to a weakening export competitiveness; and
  • Increased competition in international fibre markets from hardwood plantations in Thailand, Vietnam and South America

The Government welcomed the new relationship between industry, union, community and environmental organisations to develop the Tasmanian Forests Statement of Principles to Lead to an Agreement, as a positive step toward balancing the conservation and sustainable development and management of Tasmania’s forest resources.

To support the Statement of Principles, the Australian and Tasmanian Government worked together to undertake an initial due diligence assessment and jointly appointed an independent facilitator, Mr Bill Kelty AC, to work with the signatories to develop an implementation plan.

The Australian Government tabled the interim report from Mr Bill Kelty in the Australian Parliament on 5 April 2011.

The due diligence assessment included the preparation of a report by the Cooperative Research Centre for Forestry titled:

and a report by Forestry Tasmania for the Statement of Principles signatories titled:

Professor Jerry Vanclay (Southern Cross University) and Professor Cris Brack (Waiariki Institute of Technology, NZ) were appointed to conduct an independent review of Forestry Tasmania’s Sustainable Yield Systems as part of due diligence assessment to verify wood resource scenarios:

Statement of Principles

The Tasmanian Forests Statement of Principles to Lead to an Agreement (Statement of Principles) was publicly presented to the Premier on 18 October 2010 for consideration.

The Statement of Principles document was negotiated over a period of five months and has been signed by the Forest Industries Association Tasmania (FIAT), the National Association of Forest Industries (NAFI)*, the Australian Forest Contractors’ Association (AFCA), the Tasmanian Forest Contractors’ Association (TFCA), Timber Communities Australia (TCA), the Tasmanian Country Sawmillers’ Federation (TCSF), the Australian Conservation Foundation (ACF), The Wilderness Society (TWS), Environment Tasmania Inc (ET) and the Construction, Forestry, Mining and Energy Union (CFMEU).

The Statement of Principles recognised the need to build on the significant advancement made during the first round of negotiations and resolve a full agreement with respect to forest industry transition with the active support and facilitation of the Tasmanian and Australian Governments.

  • *  The National Association of Forest Industries (NAFI) and Australian Plantations Products and Paper Industry Council (A3P) have since merged to form The Australian Forest Products Association (AFPA).


The following organisations are Signatories to the Statement of Principles which led to the development of the Tasmanian Forests Agreement:

Forest Industries Association of Tasmania (FIAT) (www.fiatas.com.au)

The Forest Industries Association of Tasmania is an employer body which was formed in 1983 to represent the interest of processors of Tasmanian forest products, including the majority of Crowm Sawmillers. Processing activities range from producing veneers, hardwood and softwood timber, panel products, pulp and paper to export woodchips.

Australian Forests Products Association (AFPA) (www.ausfpa.com.au)

The Australian Forest Products Association (AFPA) was formed through the merger of the Australian Plantations Products and Paper Industry Council (A3P) and the National Association of Forest Industries (NAFI). AFPA  covers all aspects of the forest industry from the forest growers, harvest and haulage operators to processors and exporters.

Australian Forest Contractor’s Association (AFCA) (www.afca.asn.au)

The Australian Forest Contractors Association Ltd (AFCA) was established in 2002 to look after the interests of the harvesting and haulage contractors within the timber industry across Australia.  At the time it was felt that there was a need to establish a national body which would facilitate their long term viability and welfare and this has continued to be the primary objective of the organisation.

Tasmanian Forest Contractors Association (TFCA)  (www.tfca.com.au)

The TFCA represents the majority of Tasmanian forest harvesting, haulage, forest roading and silvicultural contracting businesses. The main role of the TFCA is to provide shared support services to forest contractors to enable them to effectively manage their businesses, particularly in areas such as business law, industrial relations, OH&S, and taxation. They also provide input to forest policy through membership of various government stakeholder bodies and by lobbying governments..

Timber Communities Australia (TCA)  (www.tca.org.au )

The TCA (formerly the Forest Protection Society) is a national organisation based in Canberra with about 80 branches across every State and Territory. Its aim is to secure long term access to natural resources to generate employment and a future for regional communities, and to ensure our unique Australian forests are scientifically evaluated and sustainable managed for the benefit of future generations and genetic diversity.

Tasmanian Sawmillers’ Association (TSA)

The TSA has a membership of sawmillers who traditionally have relied on resource from private native forests.

The TSA doesn’t have any employed representative or administrative staff.  The interests of the TSA are to seek greater resource security for their members in any future agreement.

 Australian Conservation Foundation (ACF)  (www.acfonline.org.au)

The ACF was established in 1966, the focus of ACF projects and advocacy campaigns tend to be environmental sustainability issues of international or national significance.

The Wilderness Society (TWS)  (www.wilderness.org.au)

TWS is a national environmental lobby group originally established in Tasmania in 1976.  Based on membership revenue, national membership is in the order of 45 000 people.

The TWS is constituted of a number of separately incorporated groups.

Environment Tasmania Inc (ET)  (www.et.org.au)

ET is a peak body formed in 2006 and represents 25 Tasmanian environmental groups with a reported combined Tasmanian membership of over 5 000 Tasmanians.

ET and TWS have jointly established a “Forest Reference Group” to allow the ENGOs to consult 25 other environment groups across Tasmania  during the negotiation of the Statement of Principles and the forest negotiations process.

Construction, Forestry, Mining and Energy Union (CFMEU) (www.cfmeuffpd.org.au)

Forestry workers are represented by the Forestry and Furnishing Products Division (FFPD) within the CFMEU.  CFMEU membership is concentrated in the timber processing industry (eg sawmills and veneer mills).

Documents and Resources