Monday, 24 June 2013
Rural and Regional Affairs and Transport References Committee; Report
On behalf of the Chair of the Rural and Regional Affairs and Transport References Committee I present an addendum to the report of the committee on its inquiry into the Auditor-General's reports on the Tasmanian Forestry Grants Program.
Ordered that the addendum be printed.
by leave—I would like to comment on the previously tabled report in relation to the Tasmanian Forestry Grants Program. Administration of this program was a responsibility of the Department of Agriculture, Forestry and Fisheries, and it was an exit program. The purpose of the program was to assist the Tasmanian native forest industry to adjust to an industry downturn and to reduce the amount of native forest harvesting through voluntary exit. Up to $3 million was made available to contractors wishing to exit the industry. All applications were to be assessed by a panel from the Department of Agriculture, Forestry and Fisheries; the Department of Sustainability, Environment, Water, Population and Communities; and the Tasmanian government. The basis of these assessments was a merit score and a set of assessment criteria. In February 2012, $44 million worth of grants were approved by this panel.
An extraordinary amount of concern was expressed in the time since then in relation to the granting or approval of these grants, particularly of the grants that were approved, and how the process was administered. And this was not just concern expressed through the Rural and Regional Affairs Transport Committee. The Auditor-General, through the Australian National Audit Office, also expressed a huge amount of concern about the actual application and administration of these grants. In particular, I draw the house's attention to the fact that the recommendations of the ANAO were that there was a need to improve the quality and transparency of grant assessment processes for future grants programs; that the Department of Agriculture, Forestry and Fisheries should reinforce its obligation to manage programs in accordance with approved program guidelines and the Commonwealth grant guidelines; and that it was important to retain documentation to appropriately evidence the assessment of grant applications and decisions made. The ANAO also recommended that to enhance the transparency of future grants programs the Department of Agriculture, Fisheries and Forestry advise applicants of any significant changes to the methods used to determine grant funding offers and assessment processes outlined in the program's guidelines. Finally, to monitor compliance with the terms and conditions of funding, the ANAO recommended that DAFF prepare compliance strategies and determine the basis for funding for ongoing compliance and incorporate compliance obligations into program guidelines and funding agreements. They are not light matters that have been raised.
This program was obviously designed for positive reasons to assist those in the industry to exit from the marketplace. However, it ended up as somewhat of a debacle. It pitted contractor against contractor. It pitted contractor against the environmental movement. Concern was expressed not just by the forestry industry. Across the whole of Tasmania a huge amount of concern was expressed about the way this particular grant program was administered. It painted the Tasmanian forestry industry in a bad light, which was totally unnecessary and very, very unfair. We saw a situation where grants were given to people who may not necessarily have met the guidelines. There were people who were unsuccessful in getting grants simply because the guidelines were not necessarily administered in the way they should have been administered. It was very obvious from the committee's inquiry into this that there was a lack of consultation and that the guidelines were terribly unclear. So it made it very difficult for those legitimate people who wished to avail themselves of this mechanism to leave this industry. It had obviously been identified that there was a need to reduce the amount of activity in this industry. It just did not seem that this exit package was administered in a fair and reasonable way so that all of the contractors and all of the members of the industry in Tasmania who should reasonably have been able to have equitable access to this program did have that luxury.
There was a lot of money involved in this program. One hundred million dollars of taxpayers money has been allocated to this exit program for the Tasmanian forest industry. As I said, $44 million of it was allocated in February 2012. That is a lot of money to put into a community. In the case of Tasmania—given that we have a federal election in September and then a state election in March next year—there is a lot of concern expressed about how this money is going to be used and whether it is actually being used for the purpose that it was originally designed, which was so that the Tasmanian forestry industry could exit, particularly, from native forest harvesting, or whether it is just being used as a method to get money into Tasmania to try and shore up seats for the government. It is certainly a very large bucket of money to be sloshing around in Tasmania. The concerns of the Australian National Audit Office were reiterated in the findings of the rural and regional affairs and transport committee's investigation into the Tasmanian forestry grants program. I seek leave to continue my remarks.