East Gippsland Shire councillors
The independent report commissioned by the Wellington and East Gippsland shires into the economic impact of the closure of the native timber industry in East Gippsland provides some sober reading. Source: Bruce Mitchell
And it is something of a landmark document.
This is no “woe is us” report. The report is based on data from the Australian Bureau of Statistics (ABS), and the National Institute of Economic and Industry Research (NIEIR).
This is cold, hard analytical data on what the timber industry provides East Gippsland in terms of economic benefit, and by default, what it will cost the region – the State of Victoria – if shut down.
The report highlights that shutting down the native timber industry will have economic effects far beyond East Gippsland.
In simple terms, the report points out that in 2018/19, the timber industry contributed $311 million in direct output and $101 million in direct value added.
When flow-on effects are taken into account, the industry contributed $514 million in total output and $179 million in value added.
That’s a lot of money flowing through the community in one way or the other.
But it’s the human element which perhaps makes the most interesting reading.
The report found that the timber Industry directly supported 1092 jobs in 2018/19 with a further 764 indirect jobs for a total impact of 1856 jobs.
An estimated 652 direct jobs were in the Wellington Shire and 440 in East Gippsland Shire.
The report says that if native logging ceased immediately, it is estimated that it would result in approximately 1110 job losses – 527 direct as well as an additional 315 from supply chain impacts and 268 from consumption impacts.
The report estimates that output in the region would fall by $308m on annual basis of which $155m would be direct impact. It is further estimated that 386 local jobs would be lost in industries outside of manufacturing and agriculture, forestry and fishing.
In addition, the local impacts will have ripples across industries outside the region.
It is estimated that the loss of economic activity in Wellington and Gippsland could contribute to additional supply chain and consumption induced losses of 375 jobs in the rest of Victoria and 196 jobs outside the state.
And, it goes on.
Such a closure, the report says, would lead to an increase in import of timbers from overseas sources that do not meet the strict sustainability practices and certifications met by existing Victorian forestry contractors.
It would create an increase in carbon emissions due to a considerable uplift in ‘carbon miles’ resulting from importing timber from interstate or overseas, a loss of forestry skills, expertise, knowledge, and equipment that is often the first response to fire events.
And there would be a loss of specialised manufacturing skills that are not easily transferrable to other industries.
This is new ground.
This makes the State Government’s $120 million transition package to help communities adapt pointless, almost insulting.
How does the State Government think a $120m transition package is going to plug a $514m black hole?
The State Government has already virtually admitted that its promise to transition East Gippsland to solely plantation-based timber by 2030 is something of a sham with Agriculture Minister Mary-Anne Thomas conceding that the promised plantations won’t be ready by 2030.
The Victorian Government will probably ignore, or downplay, the report.
But the one element it should not ignore, can’t possibly ignore, is the losses of 375 jobs in the rest of Victoria.
And if those job losses spread interstate, as the report expects them to, expect the phones to start ringing hot.
Well done to the Wellington and East Gippsland Shire councils.
This report has successfully taken the issue from the local stage to the national stage.
