The Federal Government said that some Tasmanian forest contractors who have received a grant to leave the industry want to return. Source: ABC News
Under the Tasmanian Forests Agreement, also known as the forest peace deal, the former federal Labor government provided $45 million in exit grants.
However, now the deal is being dismantled by the new state Liberal government, some of the 87 contractors whose grant applications were approved have had a change of heart.
The payments were capped at $3 million and the contractors had to agree not to work in the sector for 10 years.
Tasmanian Liberal Senator Richard Colbeck, who is also the Parliamentary Secretary for Agriculture, has confirmed some are now trying to return to the industry.
“I have had conversations with some in the forest contractors’ sector about the opportunity to buy back into the industry,” he said.
“There is a process in place under which they can look at buying their way back into the industry if that’s what they want to do.”
Senator Colbeck argued that it is a sign the timber industry in Tasmania is recovering.
“The economy in the forestry industry was damaged so badly by the Labor Party and the Greens that demand for forest products declined, and that demand is now returning,” he said.
Contractors who want to return to the industry have to repay their grants and enter a deed of termination with the Commonwealth.
Senator Colbeck says one has already taken up the offer.
A report by the Commonwealth Auditor-General last year found millions of dollars from the exit scheme had been given to people who may not have been eligible.
The Federal Government investigated 18 allegations of fraud. None were found to be valid.
Revelations about the deed of termination come as timber company Ta Ann Tasmania marked the beginning of work to build a new plywood mill near Smithton in the north-west.
The company gave up 40% of its wood supply under the peace deal and in return received $7.5 million in federal funding to complete the mill project.
It is expected to create 90 jobs during construction and more than 100 once it is producing plywood.