Jobs and forests: how to save both

February 8, 1995
Issue 

By Lisa Macdonald

The blockade of Parliament House in Canberra by 4000 timber workers has narrowed the terms of the export woodchipping licence debate to a question of "jobs versus environment". Yet all of the available information on employment in the timber industry indicates that posing the question this way is false.

The dispute is not about protecting timber workers' jobs. It is not even about whether Australia will continue to export woodchips. The big woodchip export companies try to pose the issues that way to hide the real issue: whether they will continue to receive hundreds of millions of dollars in government subsidies.

The timber companies are able to meet their demand for woodchips from plantation timber. They do not do so only because they are being subsidised to destroy irreplaceable old growth forests.

If the workers blockading Parliament House gain their demand that the 1995 woodchip export licences granted by resources minister David Beddall last December be allowed to stand, they, along with our native forests, will be the real losers. The only winners will be the woodchip export corporations.

The Resource Assessment Commission (RAC) report of 1992 estimated that 40,700 people (about 0.5% of the Australian work force) are employed in forestry, contracting, log sawmilling, resawn timber, veneer and boards, woodchipping and pulp and paper production. This amounts to 3% of the total manufacturing work force.

Chipping jobs

Employment in the industry has fallen by about 40% in the last 25 years. Yet in the same period the amount of timber extracted from forests rose by 40%. Capital-intensive woodchipping — the very sector that the Canberra blockade is campaigning to strengthen — is the major reason for this decline in jobs.

Australia's main forestry export is woodchips, which account for 74% of forest products export earnings (1988-89). But while the woodchip export sector utilises about 45% of native forest timber, it employs less than 2% of the timber work force, about 800 jobs nationally.

Clear-felling for woodchipping is highly mechanised and therefore can extract and process vast amounts of wood with very few workers. As Justice Stewart said in his forest and timber inquiry draft report in 1991, "Australia is in the process of restructuring an industry from one that is labour intensive ... to one that is equipment intensive".

The fact that woodchip-driven forest management is costing jobs is most clearly seen in Tasmania, which supplies 40% of Australia's total woodchips and where jobs in the industry decreased by 25% between 1971 and 1991 alongside a simultaneous 260% increase in wood consumption by Tasmanian mills.

The timber companies are destroying jobs for the same reason any company destroys them: it's profitable. According to Dr Robert Bain, executive director of the National Association of Forest Industries, "Every timber company is doing very well at the present time, and the timber divisions are making major contributions to returns".

Throughout 1994, pulp prices in the timber products market in the US and Australia jumped 80%. Fourth quarter reports now being lodged by North American timber products groups, usually closely mirrored by those in Australia, show almost all with improved earnings and many with record profits.

Subsidies

A major contribution to the timber corporations' healthy profits is the enormous subsidies of the industry by government through the underpricing of native forests when logging royalties are set.

A number of organisations, including the National Plantations Advisory Council, Victoria's auditor general and the Industry Commission, have concluded that state governments have been selling timber from native forests for well below its true value.

A recent Victorian study concludes that the state government spends $91 million annually to provide sawlogs to timber companies, but receives only $41 million in royalties. In other words, Victorians are paying the timber industry $50 million a year to cut down the forests. According to Dr Clive Hamilton, environmental economist and director of the newly established Australia Institute in Canberra, "this figure turns out to be a very conservative estimate — the true figure is more like $300 million".

According to a 1992 study by the Economic Planning and Advisory Council, Australian taxpayers have provided subsidies to the timber industry in the order of $5 billion in the last 70 years. The total subsidies provided by state forestry agencies are now in the order of $170 million per year. As Hamilton points out, "These subsidies pumped into the industry by governments mean jobs are not created in other parts of the economy".

These large subsidies also create a serious price gap between native forest timber and plantation timber, which operates as a powerful disincentive for investment in native hardwood plantations.

For example, APPM in Tasmania is currently charged a royalty of just $2.21 per tonne on hardwood from crown land for its Burnie pulp mill. According to the Tasmanian Wilderness Society, hardwood from its own plantations costs the company up to $13 per tonne to harvest. Until the government subsidy stops, it will remain cheaper to exploit native forests than to develop hardwood plantations.

The first experimental plantings of native and exotic species were in the 1860s. By the early 1990s, pine was by far the most widely used species. In the early 1960s, a plan to become self-sufficient in softwood by the year 2000 began. Several Softwood Forestry Agreement Acts were enacted throughout the next 20 years, with a general trend of diminishing federal support. Today there are almost 1 million hectares of exotic pine in Australia and only about 80,000 hectares of native hardwood.

The lack of government support for the hardwood plantation industry, choosing instead to subsidise the native forest industry, is the reason that hardwood plantations are considered "out of the race" economically. The only states with any significant native hardwood plantations are NSW and Tasmania. It is not known how much timber these plantations contribute to the industry, because the NSW Forestry Commission stopped collecting separate statistics for publicly owned hardwood plantations some time ago. New Zealand, however, is now benefiting from a boom in hardwood exports from plantations established in the 1930s.

It has been suggested (Angel in National Parks Journal, Vol. 27) that the existing amounts of pine provide the basics for self-sufficiency already, and that if they were properly utilised, they could take pressure off our native forests now.

Protecting jobs

Much emphasis has been placed by industry advocates on the importance of native forest logging to regional employment, but direct industry employment is often in the order of only 30%. This means that 70% of the work force are employed in ancillary industries or other commercial fields. Most "timber towns" have plantations in the immediate vicinity. Timber from these could be substituted with minimum disruption.

A 1993 Wilderness Society study, "Do Greens Cost Jobs?", found that 98% of job losses in the industry during 1971-1989 were due to increased mechanisation, competition from plantation timber and the industry running out of forest due to over-logging. Only 2% of job losses were caused by forests being reserved.

Further, the job losses in native forests have been more than compensated for by increasing employment in growing and processing plantation timber. In Victoria, processing mature plantations will have provided around 4000 new jobs by the mid-1990s (RAC Forest & Timber Inquiry, 1991), and in the key timber region of south-east NSW, there are as many jobs due to come on stream from plantation logging as would be lost if logging in native forests was stopped altogether.

"The timber industry knows this", Sid Walker from the Nature Conservation Council told Green Left Weekly. "But they have made it clear that they don't want one or the other [access to native forests or plantations], they want both".

If all logging in old growth forests were stopped immediately, an estimated 1000-2000 jobs would be affected. As Hamilton notes,"We should not fall for the argument that the industry is a good efficient source of employment ... but as environmentalists we must also be concerned with social justice. That's why many environmentalists advocate the phasing out of logging rather than a sudden end.

"Unemployment is an ethical issue, just as saving the environment is. None of us have any desire to see working people deprived of their livelihood, and it is entirely reasonable to provide compensation and retraining packages for affected workers, just as the Commonwealth and Queensland governments did when they banned logging on Fraser Island."

A more immediate and comprehensive solution would be to stop the subsidies to the industry, requiring it to pay the true cost of roading, forest management and the real value of the timber it obtains from public lands. This, together with a ban on woodchipping of any environmentally valuable forest, would force the companies to move swiftly into their own plantations, many of which are coming on line for harvesting now.

This would save both timber workers' jobs and our old growth forests. It would save all of us the government subsidies now being given to timber corporations. The only losers would be those corporations, which would have to start getting along without handouts.

It is essential that the environment movement recognise that it will be possible to achieve the goal of an ecologically sustainable timber industry only with the support of the employees of the industry itself. This means campaigning to protect both the forests and timber workers' jobs and democratic rights.

It is equally essential that timber workers and their unions recognise that industry campaigns which focus on native forest woodchipping can only result in a downward spiral of job losses. It is the prospect of lost profits, not lost jobs, which is motivating the timber companies' funding of the blockade in Canberra.

By forming the front lines of the companies' pro-woodchipping campaign, timber workers are acting in their own worst interests. They are being led down that path by a union leadership not noted for militancy over the past decade, during which thousands of jobs were sacrificed to industry restructuring while company profits soared.

The battle to stop woodchipping in our old growth forests is as much a battle to save jobs as it is to save the environment. The real choice is not jobs or the environment. It's both or neither.

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