29 April 1998 ASSEMBLY
 

    VICTORIAN PLANTATIONS CORPORATION (AMENDMENT)
                                             BILL

                                         Second reading

Debate resumed from 9 April; motion of Mr STOCKDALE (Treasurer).

Ms GARBUTT (Bundoora) -- I am pleased to present the opposition's case against the Victorian Plantations Corporation
(Amendment) Bill. Members of the opposition have a number of serious concerns about the bill. Firstly, we are being asked
to accept it on face value with insufficient detail about any proposed benefits or costs of privatisation. For example, we do
not know what the cost benefits will be. There has been insufficient time for the public to evaluate the road closures and the
loss of recreation and conservation areas and native forests.

No public consultation has been undertaken, despite the fact that generations have used state forests for various forms of
recreation from four-wheel driving to fishing. This is another of the government's privatisation schemes driven by ideology
with no consideration for anyone else's values.

The proposed privatisation of the Victorian Plantations Corporation will mean a massive shift of public assets into private
hands. I shall examine some of the figures involved in the privatisation. There are nearly 170 000 hectares of public land,
$323 million worth of public assets and 120 full-time jobs in the corporation. In 1997 VPC's revenue was $70 million with
a profit of $30 million. It produced 2 million cubic metres of timber, both softwood and hardwood, from areas including at
least 20 000 hectares of native vegetation.

The VPC was corporatised in 1993 under the principal act that will be amended by the bill. The corporation was given a
commercial focus.

It was also vested with nearly 170 000 hectares of public land, but privatisation was always on the government's agenda.
We know from documents obtained under FOI that by September 1996 that the government was having discussions with
several private buyers. Of course, no information has been released to the public, and even the FOI cases I have been
pursuing have been vigorously resisted, to the extent that the Department of Natural Resources and Environment has denied
it has any documents about the privatisation. That is the pattern of this government. No information gets out and secrecy
prevails over everything, including the right of the public to know how its assets are being dealt with.

The bill provides for the sale of VPC assets either as a whole or any of the three parts located in the regional areas of
Gippsland, Central Victoria and Western Victoria. It will grant perpetual licences over public land.

The government claims it is not selling the land, but in fact it is selling perpetual licences over the land, which will see the
licence-holders given every status of private owners.

So far as I can see, there is no difference between the land covered by one of these perpetual licences and the

land now being sold, except that the private owner can use it only for plantations and timber harvesting. If the licensee no
longer wants to use the land for plantations, the licence can be handed back and sold to the former licensee. In effect, nearly
2 per cent of Victoria's public land is being privatised.

The bill amends other acts to ensure the new owners pay all taxes and charges that the private plantation owners would pay,
such as those under the Water Act and the Catchment and Land Protection Act. In every way these owners are being treated
as private owners of public land. The bill identifies land that will be divested back to the Crown by the VPC and declared
public roads. It also provides for many road reservations and other land to be vested in the VPC and then privatised. Some
pieces of land will be vested in the Department of Natural Resources and Environment in recognition of their use for public
recreation purposes.

However, there is no list of the land that will be returned to the public. The only way a member of the public can find out
which land will be returned for recreational purposes is if he or she goes to the central plan office, compares the old map
with the new and finds a bit of land that is on the old map and not on the new one.

It just might be that land that will be returned to the DNRE. There is no public list, and if anyone jumps through that series
of hoops I would be amazed. There is no detail the public can use to check whether they will continue to have access to areas
they have probably been using for generations. Members of the public have not been asked which tracks they use for
fishing, bushwalking, four-wheel driving or shooting. There has been no consultation with any of the users to identify the
land members of the public may wish to retain access to.

The bill provides for the ongoing employment of VPC workers by the new owners and purports to protect their conditions.
However, that is qualified by the fact that they can still be put off. I will refer to that later.

The major feature of the bill is its excessive secrecy about details, including the lack of information available to the public
and the lack of time for the public to check what the maps mean.

I have received a letter from people from the southern Strzeleckis saying exactly that. They argue that, first and foremost,
debate on the bill needs to be adjourned. Locals are still not happy about the land included in the eastern Strzeleckis in 1993.
They were not informed then and have since been shown only the VPC map that was displayed at the Foster Agricultural
Show, which colours in the entire 40 000 hectares of the Strzelecki State Forest, showing it as being vested in them. Locals
know that is clearly false. The updated 1998 maps have not been in circulation long enough for the public to get access to
them, examine them and forward their comments. Those people are clear about the need for extra time to examine the maps,
which need to be checked on the ground in detail.

For those reasons I move the following reasoned amendment:

       That all the words after 'That' be omitted with the view of inserting in place thereof the words 'this house refuses to
       read this bill a second time until all details are made public and full public consultation has taken place regarding --

(i)which public lands will be licensed;

(ii)the future of areas of native vegetation now vested with the Victorian Plantations Corporation; and

(iii)the financial implications and evaluations of the proposals'.

I now refer to some of the concerns the opposition has about the bill, the first of which is the financial implications. No
financial details have been provided, which makes any evaluation impossible.

A cost-benefit analysis of the proposal is not available. It was not in the press release, and it is not in the second-reading
speech. What other options for privatisation were considered? What is the expected price, and on what is it based? The
processes and time lines are vague. Will the companies have to be publicly listed? What will the impact be on the other
private growers? Other growers are complaining about the impact on prices. The Weekly Times recently reported that the
North East Victoria Forest Growers Cooperative was expressing a great deal of concern. It is reported as saying:

       Private forestry operators believe the sell-off of state government plantations will keep them locked out of valuable
       timber markets.

Surely that is the exact opposite of the reaction the government expected. The growers have obviously not been kept fully
informed, just like the rest of us.

Another major concern is that transforming public land into private land, which the privatisation effectively does, precludes
the consideration of alternative uses. It is a vast area of public land that has traditionally been managed for other uses as well
-- in other words, it has multipurpose uses. They include, for example, water catchment and soil conservation. Tourism is a
growing big industry in many areas. The sale will prevent that being considered as an alternative use. I quote from a letter
from the South Gippsland Conservation League, which gives a detailed example of the sorts of alternatives that will be cut
out by the bill. The chairperson writes:

       To illustrate my point, our society has spent the last two years investigating the prospect of developing a heritage
       walking trail in the Upper Franklin River valley along the historic Tin Mine Water Race (still existing after 100
       years) which would pass and overlook the spectacular Silver Ripple Falls -- a magnificent potential tourist attraction
       close to the tourist operators in the Welshpool-Toora-Foster areas who strongly support the proposal, along with
       the Shire of South Gippsland.

Obviously that will be cut out if the public is denied access to those areas. I also read a letter from Nancy Phillips from
Gormandale, who puts things plainly in describing the likely effect on the Strzeleckis:

       I live 3 kilometres from the Grand Ridge Road, a major tourist route.

       100 000 people flock to this scenic region annually, yet in the most beautiful and ecologically sensitive areas, VPC
       is systematically logging with little regard to the visual impact on the tourist industry.

She further says:

       In my view, it is extremely rash to be downgrading these dollar-earning scenic areas.

That is exactly what will happen with the mass privatisation of public land. One of the major issues is public access to public
land. The government has stressed that the land will remain as Crown land, even though I argue it will effectively be in
private ownership. However, the public will not be allowed onto that public land. The maps in the central plan office are
survey maps.

Even if people take the time to get there -- they have only two weeks to look at them -- the maps will be meaningless if they
cannot go back and check on the ground to see whether the tracks they are interested in will remain open.

A range of people have used those forests for decades for bush walking, fishing, four-wheel driving, shooting, horse riding
and other outdoor activities. They will not know whether the areas they use have been sold off and denied to them until they
front up and find the gates locked across the tracks. In a letter dated 24 April the Federation of Victorian Walking Clubs
states:

       Vicwalk is totally opposed to any restriction on access that may arise as a result of this bill.

       Any proposal to close roads must be done in consultation with user groups.

There has been no public consultation. Vicwalk is a peak group through which all walking clubs around the state could have
been reassured about access to areas where their members have traditionally walked, but that has not happened. Unless
those people have been to the central plan office, wherever that was, looked at the maps and known what to look for and
how to identify the areas, they still do not know what is involved. They are typical of the groups that use these forests.

Another major concern is that native vegetation is included in the land that will be put in private hands. There is at least 20
000 hectares of native forest in the Strzelecki Ranges. It is not bush or scrub, as some people at the VPC have been calling it
when locals have talked to them about it, much of it is rainforest, old-growth forest or regrowth. This is high quality,
environmentally sensitive forest that should be protected, yet it is included in the land to be handed over to private enterprise.

Even the minister's second-reading speech and the budget papers recognise that this privatisation involves at least 55 000
hectares of land that is not in plantation. The documents identify areas of land that are in pine, eucalypt or hardwood
plantations, and if you add them together you find that they total 55 000 hectares less than the total amount of land to be
privatised. Some of it might be tracks and roads and so on, but most of it is native vegetation. In the Strzelecki Ranges local
people tell me they can identify many hectares of native forest, some of it adjoining existing reserves or even the Tarra-Bulga
National Park. These are not minor areas consisting of gullies and steep slopes, as has been asserted by the VPC and the
government.

How did this happen? In March an interesting article appeared in Environment News describing exactly how vast areas of
native forest ended up in plantation land. It says:

       It appears that the VPC ended up holding major tracts of forest in the region through a simple process of relabelling
       maps when the VPC was created.

       The state forest was made up of 'blocks'. Examination of the detailed Strzelecki state forest maps that accompany
       the 1993 VPC act shows that where plantations were part of blocks, they were not mapped out separately.

       So instead of the plantation areas being selected out of these blocks for handing over to the VPC, it appears that the
       word 'plantation' was simply substituted for 'block' on the maps and the whole of the affected blocks handed over.

       These blocks may contain plantation, but they also contain a diverse range of Mountain Ash old growth and
       regrowth, Messmate forest, Acalca forest and rainforest.

That is all about to be sold off to private interests. Many areas in the plantation cannot or should not be turned into
plantation. They should not be logged because they would be excluded by the Code of Forest Practices on the ground that
they are gullies, rainforests or steep slopes. Those areas are not permitted to be logged and should be excluded from the
plantation land. If a plantation owner cannot use them, they should be

divested and kept in public ownership, and the public should be allowed access to them. Many of them are recognised as
being of state significance. The old Conservation, Forests and Lands report of 1984 cites the botanical significance in
Central Gippsland and identifies some of the land as being of state significance.

The government is not just privatising plantations; it is privatising native vegetation.

It is argued that many areas in the Strzeleckis identified as hardwood plantation are actually native vegetation. The VPC
insists it is not logging native vegetation, old growth or regrowth, yet many people argue that the vegetation is native
vegetation. It is not plantation; they are simply logging it as well. The government needs to identify those areas and divest
them. Members of a local group, Friends of Gippsland Bush, tell me they have been fighting a battle with the VPC for
several years and asking it to map out which are areas of native vegetation and which are hardwood plantations, but they
have been unsuccessful. A fax from the group dated 17 April states:

       The timber industry's maps bear no resemblance to the Department of NRE vegetation maps.

       It was noted that none of the legends on any of the maps contained the word plantations.

       The terminology of plantation is misleading. In many cases the vegetation is regrowth.

It continues:

       Thus, through a process of deception, state forest is being transformed into 'hardwood plantation' to be divested by
       VPC for private development.

It continues with the group's recommendation:

       An urgent independent inquiry to establish the validity of VPC claims based on well-informed, expert advice, is
       needed before the process of consideration of matters contained in the bill proceeds.

That is precisely what I have tried to say in my reasoned amendment: the future of the areas of native vegetation now vested
in the VPC must be fully considered and the bill should not be proceeded with until all the details about that land and its
future are considered and the public is consulted. It is not good enough for the VPC to claim, 'This is hardwood; it is not the
plantation', when most locals know and believe it is high quality forest that should not be logged.

Unfortunately, the Strzeleckis have a history of earlier inappropriate development, including farming. Many of those
enterprises failed, often causing heartbreak. The problems have been repeated with some plantations in inappropriate
positions and some being unsuccessful. Some were on land that was too steep, some blocked wildlife corridors and
encroached on wildlife reserves. There should be public consultation on the areas involved and some areas should be
divested rather than being sold off in big blocks. No studies have been done on the long-term impact of clear felling on the
plantations.

I have been told constantly that pine plantations -- --

       The ACTING SPEAKER (Mr Cunningham) -- Order! The time has arrived under sessional orders for consideration
       to be given to the adjournment of the house.

Sitting continued on motion of Mr REYNOLDS (Minister for Sport).

Ms GARBUTT (Bundoora) -- We do not know what impact the prolonged use of that land will have on plantation forestry.
Active conservationists Kim Devenish and Julie Constable raised some general concerns with me, asking how many
plantations the land can sustain. They pointed out that:

       The regular churning up of the soil will break down its substructure, leach out the nutrients, and cause erosion and
       changes to hydrology and water quality ...

       The effect of 3 or more clear fellings per century is totally unknown.

There are major concerns about the long-term impact of so many plantations and other public land being handed over to
private interests.

Another concern is the forestry practices of the Victorian Plantations Corporation. I have received numerous and constant
complaints about breaches of the Code of Forest Practices since 1993, when the VPC began to be monitored by the private
sector. The monitoring is supposed to be done by local government, but it has neither the expertise nor the resources to do
the job. Recently I was handed a folder of horrifying colour photos. It is a shame I cannot incorporate them in Hansard.

Mr Perton interjected.

Ms GARBUTT -- Yes, they are horrifying. I agree with you; we should be concerned. They show disgraceful examples of
clear breaches of the code. It is a bit like radio: you cannot show pictures over Parliament! For example, one picture clearly
shows the effects of the logging of slopes in excess of 30 degrees in the Strzeleckis. That photograph has been identified as
the Morwell West branch north of Grand Ridge Road. Other photos show the absence of the filter strips required by the
Code of Forest Practices, and the felling of trees into gullies and streamsides.

       An honourable member interjected.

Ms GARBUTT -- I would be pleased to take the honourable member down there to show him those disgraceful practices.

It is clear that the forestry practices of the VPC have not been adequate.

Even the guidelines in the private section of the code are just that -- guidelines rather than prescriptions -- and the same is
true for public land. Even though the department have been advised about clear breaches of the code, little has happened. I
have been alerted to several breaches of the code in an area just outside the Gunyah Gunyah Rainforest Reserve on the
Stronach and Red Hill Tracks. Local people have informed me that the VPC has logged in gullies and logged the mature
rainforest blackwood, myrtle and beech trees. They have told me that debris has been bulldozed into gullies and that the road
and buffer requirements in the code have been ignored. After I sent the information to the South Gippsland Shire Council, I
received a letter confirming that those breaches had occurred and that it had taken the matter up with the department. Those
sorts of breaches are still continuing. The photographs I have referred show more recent damage than the damage that was
reported.

Groups such as Environment Victoria are concerned that local governments lack the expertise and resources to effectively
monitor forestry practices. The groups recommend that the bill should not be passed unless responsibility for private
forestry practices reverts to the state government and the use of the public land such as that which we are now transferring is
monitored by the department. People fear the bill will lead to shorter-term rotations so that timber will not be used for saw
logs and we will have a woodchipping rather than a saw-logging industry on our hands.

I again turn to the role of local councils, which are annoyed that they were not adequately consulted about the bill through
their peak body, the Municipal Association of Victoria. They have major concerns that many of the roads in plantations will
become the responsibility of local government. Although councils will receive some rates from private companies, they will
be nowhere near the cost of maintaining the roads. I have been given a couple of examples.

The Glenelg Shire Council will become responsible for an extra 25 kilometres of roads with little money to help it maintain
them. Local government has not been consulted about the increased burden it will have to bear.

The Victorian Farmers Federation has written to me about practical -- --

Honourable members interjecting.

Ms GARBUTT -- Well if you are not talking -- --

       An honourable member interjected.

Ms GARBUTT -- Someone obviously has to find out its attitude -- --

       The ACTING SPEAKER (Mr Cunningham) -- Order!

The honourable member will address the Chair.

Mr Perton interjected.

       The ACTING SPEAKER (Mr Cunningham) -- Order! The honourable member for Doncaster is making it very
       difficult.

Ms GARBUTT -- It is clear that the government parties are paying no attention to the VFF; they neither know nor care what
it thinks. The VFF has drawn the opposition's attention to the fact that under the bill the VPC is not subject to the Fences
Act. There are thousands of kilometres of fences around the land. I ask the minister to clarify whether the bill will be
amended to ensure that the VPC and its private successors are subject to the Fences Act?

Another major concern is the protection of workers rights, including their ongoing employment. Although the bill talks
about protecting workers, that is qualified. For example, clause 49(3) states:

       Nothing in this section prevents a person listed in the document as an officer or employee of the corporation from
       resigning or being dismissed at any time before the relevant date in accordance with the terms and conditions of his
       or her appointment or employment.

Similarly, clause 50(3) says there will be no redundancy payments, so there are great qualifications to the protections in the
bill.

The minister should provide a guarantee that the Victorian Plantations Corporations will not be cutting its labour force or
shedding labour so that it can reduce its contingent liabilities such as superannuation; that it will not be engaging in those
sorts of sharp practices that we have seen on the docks to get the price up so that it will get more money in. We need to be
convinced about the government's sincerity about the protection of workers' rights.

In summary, the opposition has serious concerns about the bill. One of the underlying features is that we are simply being
asked to buy a pig in a poke because we do not have details about a whole range of serious issues the government has
simply glossed over. It has told us absolutely nothing about the detail of the sale, of

its treatment of native forests, of public access in the future or of the conversion of native forests into plantation land.

Ms Gillett -- What are they hiding?

Ms GARBUTT -- We do have to ask what is the government hiding, because there has been no detail; because it is not spelt
out the public simply does not know. The public is being kept in the dark and is being asked to take the government on trust.
Those days are long gone. Nobody in this community is taking the government on trust any more. We know that it is driven
by one motive alone, and that is profit and the bottom line; that any other consideration, whether it is public access to public
land, the best price, the best model of privatisation, or the environmental values of the land it is dealing with, none of those
issues seem to count with this government.

It is driven by blind ideology.

The government puts its greedy claws onto public lands via this bill with absolutely no public consultation, and the
ramifications will last forever, like the perpetual licensing that the legislation is granting.

Mr A. F. PLOWMAN (Benambra) -- I refer particularly to the area of the Victorian Plantations Corporation I know well, the
Koetong-Shelley area between Wodonga and Corryong where we have one of the greatest hospitals funded to about $4.5
million that the shadow minister for health and community services does not even know about.

The honourable member for Bundoora was rampant in her criticism about the bill and about what is in it. The reasoned
amendment is pathetic. The reasoned amendment seeks to delay the bill until a full public consultation has taken place,
particularly as to which lands are licensed.

The honourable member has already told the house she has seen the maps so she knows full well which lands are licensed.
Equally, she refers to the future of areas of native vegetation now vested with VPC. I grant you, there is quite an area of
land under public forest vested with VPC. But again, it is clear from an examination of the maps exactly what area will still
be retained by VPC and what land reverts back to the Department of Natural Resources and Environment and the reasons it
will do so. I say clearly to the honourable members for Bundoora and Gippsland West that in the electorate that I know well
every area that has been retained for VPC is retained for a reason. It is either required for access or drainage lines, or the
areas are too steep to be forested but certainly they cannot be accessed by any other means.

The third point made in the reasoned amendment is that the financial implications and the valuation of the proposal should be
made known.

That indicates to me the honourable member for Bundoora knows little about privatisation if she wants those figures and
those facts to be made known when this area is to be privatised -- the very last thing you would want to do is show your
hand! The honourable member, to her credit, advised the house how that privatisation process might be conducted, and that
means it might be more than one flower in the field. The last thing the government wants is to lose the opportunity for
competition in the sale of this area and its productive capacity.

The honourable member for Bundoora referred to costs and benefits -- no consultation, secrecy or concern about land
coming back to DNRE and public access being disallowed. The reason the honourable member asks all these questions is
that, to my knowledge, she has never been up to one of the biggest areas in north-east Victoria where these public areas are.
We have in one plantation alone between 17 000 and 19 000 hectares of plantation forest.

The only way to get to know that area is to drive where you can and walk the rest and know precisely -- as I think the
honourable member for Gippsland West is trying to indicate -- the areas in question so you can comment on them. I cannot
comment on the area south of the Great Dividing Range but I certainly can comment on the area north of the divide. If the
honourable member for Bundoora wishes to learn about those areas, I would be happy to take her around and show her
precisely the reasons those areas under native forest are being retained.

Mr Perton -- She is ignoring you.

Mr A. F. PLOWMAN -- I would be happy to do that for the honourable member for Bundoora, but I can see she is totally
ignoring an offer too good to knock back. The honourable member went on to say that all the blocks were just handed over
willy-nilly. What a remarkable statement. There has been a survey done -- and the honourable member knows full well the
area that has been surveyed.

This is the biggest single survey ever conducted in Victoria. If the honourable member for Bundoora is not aware of it, she
should be. Because of that, it is a nonsense to say it has just been a handover, and that the government is privatising
hardwood forests. Again, north of the divide there is no hardwood forested area that is logged or is likely to be logged that
will be handed over.

The last point I make is that the honourable member for Bundoora said the maps are not similar; of course they

are not similar. This is the first time this area of major plantation in Victoria has been positively identified and properly
mapped. Therefore, the existing map is nothing like the maps that have been presented and surveyed by the
Surveyor-General.

The objective of the state government is to treble the plantation area by the year 2020. The bill will go a long way towards
achieving that because the government is introducing competition into public plantation forestry. I suggest that we take what
happened in New Zealand as a yardstick. When plantation forestry in New Zealand was privatised the whole industry took
off. We can learn a lesson from what happened there. The objective is well worth trying to achieve and I am sure the
privatisation process will give the industry the stimulus it needs. When the Surveyor-General undertook a survey of the area
everything that was required for the plantation was properly surveyed, including all the roads and road alignments.
Unsuitable roads were resited and some existing public roads were annulled and replaced by roads that better served the
needs not only of the plantation but also of the public.

The honourable member for Bundoora also referred to public access.

Many of the roads in the plantations have been divested, have reverted back to the Crown and are now public roads that
allow public access. I know that under the current management of VPC public access is not denied north of the Great Divide
except on the odd occasion when a forest procedure, such as logging, is being undertaken and public safety must be
considered. The roads are closed for the period required, but they are certainly not closed continually. Public access is still
available to all parts of the Shelley-Koetong area, and in many respects it has been enhanced.

The recreational sites in the Shelley-Koetong area will revert to the Crown and will be managed by Parks Victoria. The sites
are the Tom Mitchell Reserve, the Shelley camp and the lookout close to the Murray Valley Highway, on the east side of the
Shelley Reserve. The delightful Avondale Gardens area, which was settled in the 1870s or 1880s, will revert to the Crown.
It is a very popular tourist attraction for visitors to the area.

The land will be transferred and the production will be privatised by way of plantation licences that will be transferred in
perpetuity to the purchasers. The assets will go with the plantation licence, as will the opportunity for staff to transfer. All
the people in my area who are involved with VPC are excited by the challenge of going to private ownership. They are
eagerly awaiting the opportunities and career possibilities it might give them. They can see nothing but benefit from it.
Following the sale of the licence, the licensee will have to operate on a commercial footing. Rates will be paid, as will land
tax where applicable. There will be an exemption for the area under forest.

Another important amendment is made to the Country Fire Authority Act. Under that act, pursuant to which the industry fire
brigades were formed, VPC is required to have an industry fire brigade in any plantation area in excess of 10 000 hectares.
In areas larger than 500 hectares, the Country Fire Authority has the right to require that an industry fire brigade be
established.

I will comment on that again later.

I will put a few statistics into perspective. VPC has a major plantation area of approximately 160 000 hectares of land vested
in it, of which 115 000 hectares are planted with softwood. The other large players in Victoria are Amcor with about 80 000
hectares, CSR with about 20 000 hectares, and Victree with about 5000 hectares. The other large area near north-east
Victoria is in the Tumbarumba area of New South Wales, most of which is publicly owned, but there are also large private
plantations in that area and on the Victorian side of the River Murray.

New Zealand, Australia's major competitor in this area, produces approximately 10 million cubic metres of softwood logs
per year as against the approximately 1.8 million produced in Australia. We have a long way to go if we want to catch New
Zealand and be competitive.

About 50 per cent of New Zealand softwood logs are processed and much of the rest is exported in raw form. As Australia
develops its softwood industry there is enormous potential to also develop the processing side of the industry. If we can
treble the production of softwoods in Victoria we will go a long way towards meeting Australia's requirements -- bearing in
mind that Australia is a net importer of timber, including softwoods -- and by the year 2020 we should be a net exporter of
softwoods, and it is hoped a net exporter of processed softwoods.

I referred briefly to the New Zealand experience. I repeat that a complete revolution took place from the top to the bottom in
that country when its publicly owned softwood industry was privatised. Impressively the changes initiated by changing the
ownership of the public plantations stimulated the private industry to keep up. I suggest that with the proposed degree of
competition the Victorian industry will revolutionise itself.

I look forward to seeing the effects of that in Victoria, particularly in my area in the north-east, where plantation forestry is
such an important industry.

About 90 per cent of the timber produced by VPC is committed to other companies, including Amcor. In my area we have
the mills in New South Wales at Tumbarumba and the Carter Holt Harvey mill at Myrtleford. Australian Newsprint Mills at
Albury, the largest paper mill in Australia, takes a large amount of softwood. At Wangaratta the new Dominance Industries
factory is also a large user of softwood from the north-east. VPC has about 12 per cent of the Australian market and
currently 30 per cent of Victoria's softwood needs are imported. It is hard to believe that Victoria, which is a major producer
of softwoods, still imports about 30 per cent of its softwood needs.

Victoria has an input replacement requirement as well as an enormous opportunity to earn exports, particularly if more
timber can be processed before export.

It is hoped that by the year 2001 Victoria will have met the balance and be producing as much softwood as it uses. The
north-east of Victoria contains large tracts of public land. The areas of private land comprise narrow strips surrounded by
Crown land. They are usually narrow valleys and have some of the most scenic areas in Victoria and Australia.

Mr McArthur -- No match for the Dandenongs!

Mr A. F. PLOWMAN -- They do match the Dandenongs for fires. From a firefighting point of view they present a very
difficult hazard. The fires are hard to fight and it is difficult to plan and provide sufficient manpower and machinery to
manage them. The major problem is that the manpower in the valleys is diminishing all the time, and what there is is
growing older. A minimum number of Country Fire Authority brigades are located in the area.

As the bill states, with the transfer of land to private ownership, the responsibility for firefighting will go across to the
Country Fire Authority. In most areas of the state that is appropriate because private land surrounds the plantations or at least
represents a fair proportion of the land in the vicinity. A pool of firefighters is available and there is a predominance of
interest in the surrounding private land. As I said that area in the north-east of the state is almost totally surrounded by
Crown land. It is inappropriate to have the firefighting responsibility for those areas vested in the Country Fire Authority.

I have spoken to the Treasurer and he assured me that in the circumstances the controlling interest of firefighting in the
plantation forestry areas of the VPC will rest with DNRE, which has the best capacity, the greatest manpower and receives
the greatest benefit from its involvement.

I plead with the Treasurer that if changes need to be made to the bill that he ensure that that assurance is followed up while
the bill is between houses. I ask him to examine the issue to ensure that it can and will be done.

Government amendments circulated by Mr STOCKDALE (Treasurer) pursuant to sessional orders.

Mrs MADDIGAN (Essendon) -- I am interested that the amendments are only now being circulated. Before I get into the
substance of the bill the opposition might like to consider them for a moment. Government members might recall that
yesterday the Speaker ruled that when putting forward reasoned amendments the opposition had to give 2 hours notice so
that the government would have the opportunity to consider them. The shadow Minister for Conservation and Land
Management has not seen the amendments now being presented; yet the opposition is expected to take them into account in
the discussion of the bill.

It is wrong, unjust and unacceptable for the Speaker to rule that the opposition must give 2 hours notice of a reasoned
amendment when the government gives no notice of the amendments.

Mr Stockdale -- It is not a reasoned amendment.

Mrs MADDIGAN -- I am well aware it is not a reasoned amendment. The government has had the amendments printed and
therefore must have known about them for some time.

Mr Perton -- On a point of order, Mr Acting Speaker, the honourable member for Essendon is not speaking to the bill. She
seems to be calling into question the quality of your chairmanship. I suggest you call her to order and ask her to speak on the
bill.

       The ACTING SPEAKER (Mr Cunningham) -- Order! There is no point of order. The honourable member for
       Essendon is commenting on the amendments that have been circulated. To assist the honourable member for
       Essendon I point out that indications were given during the second-reading speech that amendments would be
       circulated, so sufficient notice has been given.

Mrs MADDIGAN -- Thank you, Mr Acting Speaker. It is obvious to me that the government was aware for some time that it
intended to move amendments. It would have been polite and appropriate for the government to advise the shadow minister
earlier. It clearly demonstrates that the government is totally uninterested in the bill.

       Government members interjecting.

Mrs MADDIGAN -- I was glad to hear the honourable member for Benambra make a contribution to the bill. I was
beginning to wonder if anyone on the government side had any interest in the bill at all. It is most unfortunate that the
Treasurer was not in the house when the shadow minister contributed to the debate because she is obviously the only person
who has made any attempt to consult with the community. She is the only person with any idea of the community's views
about the bill.

Mr Perton interjected.

Mrs MADDIGAN -- I am quite happy for the honourable member for Doncaster to yell loudly in his usual rude way, but it
would be a nice change if occasionally he had something of intellectual worth to contribute to the house rather than an
exceptionally loud voice, which we have all heard before and which quite frankly does not improve with repetition.

The government has once again rushed forward with the legislation without any concern for the community and without any
understanding of the long-term effects of the bill. It was introduced on 8 April, just before Easter. A period of two weeks of
school holidays followed, and it is now being debated. The community has been denied any input at all. One wonders about
the government's rush. Why rush the debate the bill?

The government tries to tell the opposition that this does not mean the privatisation of plantations and that it is only a lease.
However, it is a perpetual lease with the option of sale at a later date. Why is the government in such a rush? What possible
difference would it make to the community if the bill did not go ahead until the spring session? Absolutely none! Apart from
the government's total unwillingness to listen to what the community has to say there is no reason to justify rushing it
through,.

I congratulate the shadow minister for making an attempt to speak to a number of groups in the past two weeks. Luckily for
us one group came to Parliament yesterday and held a demonstration on the front steps. Members of the group had hoped to
speak to a government minister, but as usual none was found. The group supporting the interests of the Strzelecki State
Forest made a number of important points about the bill and the forest in one of the brochures handed out yesterday. The
group has a much longer document that goes into these points in far more detail. It makes the point quite clearly that while
part of the area is plantation, much of it is native bush and that has not been taken into account in the government's bill. No
attempt has been made to separate the plantation area from native bush. The Strzelecki group states:

       We demand that VPC logging be restricted to the pine plantations and that a public inquiry be established to give the
       public access to maps and a chance to voice their concerns.

       The areas designated 'eucalypt plantations' have never been presented in map form, raising the possibility of abuse
       -- that this 7000 hectares could be a movable feast.

Surely that is not an unreasonable thing to ask, particularly as the area has never been on the map? Why is the government
so frightened of allowing a consultation process? The group further states:

       The comment contained in the leaflet on the water table reads as follows: The government must realise that the most
       valuable resource the Strzelecki State Forest has on offer is not timber, but water. It is the central mountain range
       for this region, and forms the headwaters of the region's major rivers. Its spongy forest floor can soak in and hold
       6 inches of water, allowing rivers to continue flowing throughout months of drought and protecting the surrounding
       lowlands from floods during the wetter months.

       Inappropriate land use in the eastern Strzelecki Ranges has a drastic effect on the quality and quantity of South and
       Central Gippsland's water and the quality of life for everyone living here.

The government may claim that is not right but it does not know because it has not examined these matters at length to
determine the long-time effects of the bill.

I was somewhat surprised to find that the honourable member for Tullamarine was not making a contribution to the debate
on the bill because I have just been handed his list of pecuniary interests which shows that he has a land beneficial interest in
pine plantations in the Otway Ranges and a company beneficial interest in the same area. I would be interested in his view on
how the privatisation of the Victorian Plantations Corporation might affect his future financial relationship with the
organisation.

The main areas of the Victorian Plantations Corporation holdings are extensive. The Strzelecki forest is one of the smaller
areas around Morwell, but there are extensive holdings around Apollo Bay, Portland, Ballarat and between Kinglake and
Tallangatta. Therefore, there is a huge area of interest in these forests by many country areas.

I had hoped that by now the government would be more sensitive to communities' interests in forests and their protection in
Victoria because of continual agitation from various groups, including demonstrations on the steps of Parliament House, to
protect their natural resources. One would think that by now the state government might be a little more eager

to hear the concerns of residents about the bill, because the questions asked by residents interested in the Strzelecki forest
reflect the interest of people in many Victorian Plantations Corporation areas.

As the shadow minister illustrated, a large amount of natural vegetation is included in the plantation areas. The 1993 bill that
set up the Victorian Plantations Corporation was pushed through Parliament quietly and with little consultation.

Mr Coleman -- You're sure about that, are you?

Mrs MADDIGAN -- I am delighted to find that the honourable member for Bennettswood is still with us. We were a little
concerned at one stage whether we should rush across the chamber and start resuscitation. I welcome his contribution, and
look forward to his more detailed contribution a little later.

In 1993 considerable concern was raised about the effect of the bill on natural vegetation and wildlife in Victoria. Those
concerns have never been fully addressed.

The shadow minister raised concerns about the way the Victorian Plantations Corporation has fulfilled its role since it was
established in 1993, and there is considerable concern within the community about its operations.

The bill contains no assurances that will make the people of Victoria any happier about the way the plantations will be
managed in the future. There is no reason for haste with the bill and no reason for the government to feel it has adequately
fulfilled its role of consultation when there is so much concern. It needs to consider the views of large numbers of Victorians
who are interested in the future of native forests, especially those covered by the bill.

Ms DAVIES (Gippsland West) -- I speak against the bill as it currently stands. I would be prepared to support it if some of
the concerns I have already expressed to the Treasurer and the Minister for Conservation and Land Management were
addressed.

I have been trying to find out about the land involved in this privatisation ever since I first heard rumours of it towards the
end of last year. I have spent considerable time in the bush and with the people who are most concerned. I took a long time
listening to what they had to say. I have spoken to representatives of the South Gippsland Shire Council, officials from the
Victorian Plantations Corporation and residents and business operators in South Gippsland. I have also spoken to Treasury
officials and conservation groups.

The key problem with the government intending to push the bill through this week is that not enough of the key players
know enough about the land involved. Therefore, the bill should be delayed.

Quoting from the second-reading speech, I point out that the bill allows:

       ...

       for the sale of the assets and all associated business interests of the Victorian Plantations Corporation.

I will correct the figures given by the honourable member for Benambra, firstly by quoting government budget paper no. 2
on page 150 which states that:

       VPC manages 107 000 hectares of softwood plantations and 8000 hectares of hardwood plantations on a total estate
       of approximately 170 000 hectares of Crown land -- --

Which is public land vested to the VPC. It is an enormous area of land. By the government's own figures it has vested in the
VPC approximately 25 000 hectares of native forest which was and always has been Crown land. It is not in reality private
land. It has been treated as if it were private land since the VPC took control, but it is not and should not be treated as private
land.

The figures change according to whom you speak to, but some of the land, which even the government acknowledges is a
minimum of 25 000 hectares of bush, will be roads and some will be gullies in between plantations. As someone who has
spent considerable amounts of time driving through and tramping in the eastern Strzelecki Ranges, I can say most sincerely
that much of the remaining land is native forest. It is good quality mountain ash and there are considerable areas of rainforest
gully. The key problem which should help the government to decide to delay the bill is that even its own Treasury officials
cannot yet show full and correct details of the type of forest on each of the certified plans of the plots for privatisation, which
are listed in the back of the bill. Contrary to the statements of the honourable member for Benambra there is yet no key map
showing where all of those small patches which have now been thoroughly traced around fit into the whole. The Treasury
officials to whom I spoke the other day told me that it will be at least two months before any such key map is available.

There is no point showing people small bitty maps of small bitty areas when the people who drew up the map have no idea
of what the actual land looks like down on the ground because they have never been there and where you cannot put all of
the pieces together to see which areas are included in the sale and which are not.

There is no evidence on those certified plans to show the detail of which areas constitute the 8000 hectares of hardwood
plantation. It seems that the 8000 hectares of hardwood plantation is movable. If you visit Amcor land you can see exactly
which area is plantation because they are labelled, 'Planted with such-and-such on such-and-such a date'. All the forest is of
similar size, there is little undergrowth and it looks almost like a pine plantation.

The areas in South Gippsland that are now labelled as plantation by the Victorian Plantations Corporation have undergone
another magical transformation in that what used to be referred to as logging coupes -- that is, forest which has regrown by
itself after selected logging -- is now referred to as plantation. It is obvious when you look at the forest which area is
plantation and which area is regrowth. You get different species and different sized trees. You get undergrowth in areas that
have regrown that you do not get in plantation timber.

The Treasurer's advisers have openly acknowledged that there are at least 19 500 hectares of native forest in the land vested
in the VPC, which must be a minimum assessment. Others have said the figure is higher. According to Treasury officials,
2000 hectares is labelled understorey timber, which they call black wattle scrub and 3000 hectares is roads, firebreaks and
timber landing areas.

Both, I suspect, may be reasonably generous assessments, but I shall grant them that.

The Treasury officials acknowledge that 12 500 hectares is in and around gullies. You can translate 'gully' as land on very
steep slopes, which is often high-quality rainforest. The Treasury officials acknowledge that at a minimum, 2000 hectares of
native forest is on land at less than a 20-degrees slope which, according to them, is able to be logged. The 2000 hectares that
they acknowledge is native forest would adjoin considerable areas of steep gully land, which in total constitutes considerable
patches of good-quality native forest.

At a minimum, according to Treasury officials, 14 500 hectares of native bush on what was Crown land is now vested in the
VPC and being treated as though it is private land. Logging in native forests on private land is treated differently to logging
on public land according to the forest code of practice.

It is permissible to clear native bush from private land to establish a plantation. That cannot be done on public land. The
VPC acknowledges it has cleared native bush to plant plantation timber. Any purchaser to the licence rights to the land
would probably clear it even more than the VPC has done; it has been clearing native forests and putting in plantations in a
way that is not allowable if the land is genuinely treated as public land, which is what the land was and should be regarded
as.

Forests on public land which are logged must be regenerated with the species that existed before the logging, but that is not
regulated on private land. The VPC acknowledges it has planted spotted gums in areas where it has logged mountain ash.
The purchaser of a licence to log VPC land would do the same thing, or probably to a greater extent, then we would have
less right to examine what is being done.

Perhaps most importantly, on public land the focus on attitude to forests is of multiple use; on the private land, and most
particularly through this privatisation, the focus is totally on establishing and using the whole area as plantation. In fact, a
condition of the licence is that the land be treated as plantation.

In the area of the eastern Strzelecki Ranges, that massive area of land which has been vested in the VPC, what has been
Crown land has that wider use. It has been used for multiple purposes for a long time. The government intends through the
privatisation to restrict a growing appreciation of forests for a multitude of purposes, apart from cutting down the trees.

The VPC has already made it harder for people to access the land; it has been making people acquire permits. Access will
become even more difficult once the land is privatised.

I shall give the house a couple of examples of the alternative use, apart from logging, which has been made of the forest in
the eastern Strzelecki Ranges. Walking groups wish to use the area. I stress that in the eastern Strzeleckis there are examples
of the only remaining area of the great Gippsland forest. The western Strzeleckis is in my electorate, and my forebears were
among the people who successfully managed to rip down the entire forest -- none is left. The eastern Strzeleckis is the only
area where you still find significant areas of good, large mountain ash forests and rainforest gullies. The only other area in
South Gippsland is on Wilsons Promontory, and access to the tiny remaining area of mountain ash is restricted. It is
important that we keep that forest. People need and wish to see it.

Part of the area the local community would like to see being used for walks includes an area along an old tin mine water race
from the upper reaches of the Franklin Mountain which goes past the Silver Ripple Falls.

This area is often used by South Gippsland schools when teaching about the activities of our ancestors from a book called
Mud in our Boots. Many people from the area, including Prom-coast Tourism, would like to see the area around Mount
Franklin removed from the

control of the VPC and made available for walking clubs and groups.

A considerable number of gipsy wagon trips take place in and around that magnificent forest area in the eastern Strzelecki
Ranges. When driving through the forest the other day I saw six wagons. The horses plod quietly and gently through the
forest allowing one to leave one's city stresses behind. Given the growth of stress in our society it is becoming more
important to have such refuges. The eastern Strzelecki Ranges have a small national park called Tara Bulga National park. It
attracts about 100 000 people a year and is a beautiful rainforest.

Most of the mountain ash are relatively young because the area was logged. The only other decent reserve is the Gunyah
Flora Reserve. That vulnerable area does not have the status even of a national park. The Gunyah reserve has a mountain
ash forest that is bigger than any other forest I have seen in the Strzelecki Ranges, apart from the forests shown in the
photographs that were taken around the time my forebears were ripping out the rest of the forest! It is a beautiful area, but it
is too small and is vulnerable. Logging of the forest and replanting of inappropriate species have occurred too close to the
edge of the reserve. Neither of those areas is large enough to be viable on its own once the rest of the forest is treated as
plantation, which means that it will be ripped out over a 30 year period and no-one will worry about the variety of plants and
animals that inhabit it.

Although the land is regarded as private land, we all know it is Crown land.

Because the members of the forest task force of the Department of Prime Minister and Cabinet were told that the 170 000
hectares was mostly plantation with some areas of black wattle scrub, the area which includes 19 500 hectares of native
forest has been excluded for consideration in the regional forest agreement negotiations due to start next month in
Gippsland. I am suspicious of the timing of the negotiations. Extensive negotiations and consultations are the most
appropriate way for a proper discussion of the fate of this area of native forest. The negotiation could occur if my reasoned
amendment is accepted and the native forest is returned to the control of the Department of Natural Resources and
Environment.

I genuinely appreciate the Treasurer's acceptance and consideration of the information and photographs I gave him today. I
am happy to show any member of the government the information and the photographs that I have with me. They show the
quality and type of forest that has already been logged.

I most sincerely urge a delay in the legislation until more people have an opportunity to find out which areas will be
privatised so that those who have spent a lot of time drawing up the maps can relate them to what is on the ground. Not just
roads and creeks need to be measured, the type of forest is also important.

I ask the house not to read the bill a second time until all areas of native forest have been withdrawn from the privatisation
process and returned to the control of the Department of Natural Resources and Environment so that a proper assessment of
the quality of the forest and its possible use can be made.

Mr COLEMAN (Bennettswood) -- I say to the motor-mouth honourable member for Essendon that the consultation that
occurred in 1993 to establish the Victorian Plantations Corporation was extensive and followed a period of nearly five years
of public debate after a similar proposition was put forward by the then Kirner Labor government. It estimated that the pine
plantation under the control of the then Department of Conservation, Forests and Lands had a value of $1 billion. The public
debate that continued after the attribution of the $1 billion stake was part of a broad public debate about the increase in the
size of the plantation itself.

The honourable member for Benambra is aware of the debate that occurred at that time, particularly as it related to the
Tallangatta Valley, when there was an attempt to increase the size of the plantation. It is ridiculous for the honourable
member for Essendon, a latter day entrant to this place, to argue that no consultation took place.

If the honourable member had done her research she would know that significant consultation took place.

Ms Davies -- It was in-house consultation. There was no public consultation.

Mr COLEMAN -- An even later arrival, the honourable member for Gippsland South, wants to argue differently. A full
public debate occurred when the corporation was established in 1993. I record my thanks to those people associated with
establishing the corporation, which grew out of the determination by the former Labor government to extract the pine
plantation out of the forest management structure within the then Department of Conservation, Forests and Lands.

In 1992, with the assistance of Tony Manderson and Dr Gerry Griffin, who had been associated with the forest, a
progressive move commenced to isolate those areas and extract the plantation from the native forest so that it could be treated
differently and managed in much the same way as it had been treated in the departmental accounts. To his credit, Tony
Manderson persisted with the process. In 1992 the incoming Kennett government

accepted what turned out to be a good proposition -- that the plantation have a corporate structure.

Dr Gerry Griffin was very much part of the initial structure that created the corporation. Subsequently the chairmanship was
taken over by Mr Robin Clements, and Mr Kevin White was appointed as managing director. He had had extensive
experience with one of the private logging companies operating in Victoria and other parts of Australia.

The corporation has proved to be a successful organisation. It has had major difficulties to deal with. Historically the
plantations were created to generate employment all over Victoria. The estates on which they were established were small,
disparate plots. We have heard lots of discussion about the Strzeleckis. Much of the land that is now part of the corporation
estate was formerly agricultural land that was handed back to the Crown. It was then turned back into forest of one sort or
another, and much of it was treated as pine plantation. As a result we now have a large estate that is broken into small areas
in some parts of the state. The corporation has attempted to rationalise part of the estate.

It has been successful in increasing the size of the estate, but one of the critical factors in its management is that until much
of the estate plantation had not been thinned until it was taken over by the corporation. Virtually from the time of its
inception the corporation put in place a thinning regime.

Now almost all the plantations have been thinned in accordance with commercially recognised management practices. As a
result in the five years the corporation has been in existence not only has the estate developed a better age profile but also it
has been given a better structure because of the thinning.

Staff transferred from the department to the corporation and the management structure that took on these tasks. Much of the
debate has centred around the survey lines that have been drawn. When creating the corporation it was necessary to establish
its assets. No previous surveys had been undertaken to ascertain the boundaries of the planted areas. Much of the work
undertaken over the past five years has been associated with developing surveys that can correctly delineate the areas of the
state in which the plantations are located.

Ms Davies interjected.

       The ACTING SPEAKER (Mr Jasper) -- Order! The honourable member for Gippsland has made her contribution.

Mr COLEMAN -- Such as it was! The intent was clear. The Labor government sought to dispose of the plantations. It
worked into its forward budget estimates that the plantations were valued at $1 billion, but the value depends on whether the
land is considered to be part of the estate. If the land were sold the estate would have a realisable a value of about $1 billion,
but if it is a matter of only the sale value of the trees, which is what is proposed in the legislation, the value is significantly
less. The figures in the commercial press today estimate the value of the estate at somewhere between $300 million and $500
million.

The stimulus for the creation of these plantations was to establish a new industry in Victoria to produce not only hardwood
but also softwood.

It was aimed at having an import replacement program for those who wanted to use softwoods. In all those matters the
corporation has been a successful operation. I thank the people who contributed to the creation of the corporation at the time
when, as minister, I had administrative responsibility. The outcome has been successful, and I am sure the financial results
that have appeared in each of the annual reports demonstrate that clearly.

Mr BAKER (Sunshine) -- This is a nice old mess, isn't it! I haven't seen anything quite like this before. The bill spends
most of its time correcting the mistakes the Minister for Conservation and Land Management seems to have perpetrated over
the past two years. For example, proposed section 114 goes to great lengths to cover the fact that levies were illegally or
improperly collected without the full weight of the law. Many of the bill's provisions are testimony to the incompetence of
either the minister or her advisers. It is hardly good counsel!

It occurs to the wicked side of my nature that this licence or lease or whatever it is bears a striking similarity to the terms and
conditions of the much-maligned pastoral leases.

Mr A. F. Plowman interjected.

Mr BAKER -- The terms and conditions are very similar to those of pastoral leases, with one exception. A pastoral lease is
an Australian invention that made land available for use while keeping it in the control of the Crown. That is what this
legislation purports to do. I urge honourable members to tell me if what I have suggested is not so.

The one exception is that you could pose the question: when is a lease not a lease and when is a licence not a licence? The
answer is: when it is forever, when the licence is held in perpetuity. Under the bill we are

handing over in perpetuity 1.6 per cent of public forest. That is 170 000 hectares that will be handed over in perpetuity under
something called an operating licence, with hardly any terms, conditions, codicils or guarantees that would satisfy anybody.
Worse still, it is being done under the cloak of darkness or the veil of secrecy!

There has been no attempt to make full disclosure of what is involved. I am not sure whether the department has effectively
audited what it is at stake. As the honourable member for Bundoora so eloquently put it earlier, isn't it true that these areas
that are under examination were called blocks, but suddenly the word 'blocks' disappeared. It is another example of
something the Treasurer has become good at -- that is, semantics and changing the nomenclature to get a totally different
meaning. Suddenly they are plantations!

When you make inquiries, as the opposition has done, you find that they are not plantations. When I was invited to speak on
the bill I made some inquiries and my first impression was that these are pine plantations, but they are not. If you look at the
Strzelecki area, for example, you find that the Victorian Plantations Corporation controls 40 000 hectares. It is composed of
13 000 hectares of pine plantation, 7000 hectares of eucalyptus plantation and 20 000 hectares of native bush. If I
understand the legislation correctly, the community had the opportunity under the existing legislation to say at some future
time that those 20 000 hectares could to be rehabilitated or turned over to native forest to go along with the stock of native
forest we already have.

I am far from satisfied about giving away land in perpetuity without a codicil, control or any option to make decisions about
reverting the use of those areas at some time in the future.

I understand some of these areas include large stands of mountain ash of ancient significance and that large areas of arable
land are being turned over to pine plantations at depressed prices. Recently in the Skipton area nine farming properties have
been taken over for the purpose of establishing pine plantations. In those cases non-farming families are pushed off the land
and the houses are bulldozed.

Whether or not we live in the city we all have some romantic sense of attachment to the bush. Many of us, especially my
family, have had links with the land for generations. I am the first of six generations -- there is now a seventh generation --
that has not stayed on the land. It is fallacious to say 120 jobs will be provided. Contractors will move in, work 10 to 12 day
shifts, and move out again. They will not become part of the permanent local community because they will become involved
in the local football team or other aspects of local life.

To its shame, the government has dotted the landscape with a series of ghost towns.

It bothers me that a full disclosure has not been made of what is involved economically. I may be out a year or two but I
understand the first harvest comes in after 15 years, so the capital cost for any investor starting from zero and setting up a
plantation that it proposes to harvest is a serious consideration. Investors will have to carry the capital cost for 15 years
before receiving a cash return. However, if someone comes and says, 'It is already there and we will sell it to you,' it
becomes an entirely different proposition.

I want to know whether the capital cost that has been borne by the taxpayers of Victoria will be factored into the price or
whether it will be given away at fire sale prices to a few mates. I understand Amcor does not want the land but a couple of
other companies are interested.

The price suggested by the honourable member for Bennetswood is $300 million to $500 million. I would have thought it is
worth a lot more than that; as I suspect would the honourable member for Bennetswood, if he considered it carefully. Who
is going to tell us on what basis the computations will be made and whether there will be a factoring in of the cost-effective
capital period that has already been carried by the taxpayers of Victoria?

Another concern to farmers is the serious problem that occurs along the edges of forests and plantations when vermin and
weeds spread on to adjacent properties -- rabbits in particular. I admit that when I had that portfolio, I used to complain on
behalf of farmers without much success. I wonder whether it will be any better with private operators. I want to know what
controls have been put in place and what guarantees will be offered to the farming community that will has to suffer the
consequences of vermin and weeds spreading from the plantations. Natural flora and fauna do not like to live in pine
plantations.

It is not an acceptable environment for them and they avoid many of these areas like the plague. Dwindling areas are
available to native flora and fauna, and that problem will be exacerbated. Once an area has been used as a pine plantation it
takes a generation for the soil to recover. Can one generation be so grossly irresponsible as to take on itself the giving way
of arable land for an entire generation.

Will the Treasurer do what he has done with other areas of privatisation and immediately reduce contingent liabilities -- for
instance, the superannuation provisions for workers who are currently employed by the

Victorian Pine Corporation -- or will he ensure that the rights of the workers are preserved? Will the Treasurer behave in
exactly the same way as he has done with a whole series of privatisations -- lower the contingent liabilities in order to hand
the land over to his avaricious mates?

I notice that in his contribution the Treasurer talked about the forests management division of the ministry.

The minister suggested those fine people and true could perform a responsible task by supervising the operations of the
private owners. That hardly fits with the budget news of just a couple of weeks ago that 9 of the 45 people are to be
retrenched.

Mr RYAN (Gippsland South) -- It is always a pleasure to follow the whimsical contributions of the honourable member for
Sunshine who is an ongoing source of wisdom and knowledge. He will be sadly missed after the next election.

Honourable members interjecting.

Mr RYAN -- I am being accused of being presumptuous.

There is hardly any presumption about it. It is important to put the legislation in its proper context because it is easy, as the
honourable member for Sunshine has amply demonstrated, to talk emotionally about preserving the national estate for future
generations. We are talking about a well-established, substantial industry that serves all Victorians and provides country
Victorians with a strong source of employment. Mechanisms are needed to enhance the future development of the industry
so it continues to provide the employment that is important to country people. The government is seeking to maintain that
all-important balance that is necessary in protecting those areas of land that need protecting.

I support the bill because it will go a long way towards enhancing the future development of the industry. It is of particular
interest to me because a substantial area of land in my electorate of Gippsland South is currently under the control of the
Victorian Plantations Corporation.

The Latrobe zone, which is based at Yarram, is a substantial employer of local folk. It is operated under the able hand of Mr
Ian Hemphill and his team. A little to the south-east of Yarram are the Gelliondale nurseries. Those who run the nurseries
are world leaders in the innovative work required to propagate the plants that are used for future timber growth. The industry
has the capacity to be even greater than it is.

At present the Latrobe zone, which runs down through the Yarram area, produces about 250 000 cubic metres of softwood
pine a year. The intention is to double that output over the next five years, which will be a huge addition to the local
resource. Pine is a completely renewable resource. It is not as if it is taken once and never grows again. On a quiet night in
Yarram you can be kept awake by the sound of those trees growing! That massive resource and is all the more important in
the context of the government's plan to triple the current value of its agricultural exports by 2020.

The bill will enhance the development of that already substantial resource.

Honourable members interjecting.

Mr RYAN -- I hear the interjections about that sounding exciting. I appreciate that Labor Party members find these things
boring because they have nothing to do with issues beyond metropolitan Melbourne. In country Victoria these issues are
significant, and those of us who represent country Victoria are anxious to ensure the continued employment of our
constituents.

In addition to the softwood plantations in the Latrobe zone my electorate contains a substantial part of Victoria's hardwood
plantations, which primarily service the newly established hard mill plant at Morwell. It is operated by the Clarke family
company under the guidance of the able Roger Clarke. About 100 000 cubic metres of plantation hardwood are fed into that
mill each year.

A successful industry has been established down there because of the appropriate use of a former SEC facility which had
lain idle for many years. The sheds and other attachments that go with the property were purchased by the Clarkes and
transformed into a successful factory. I mention that in the context of the commercial operations of the VPC.

I now turn to the bill, which provides for the sale of the assets and business interests of the VPC. However, the VPC itself
will not be sold. I say that because, based on a literal reading, one could be forgiven for interpreting the second-reading
speech as saying that the corporation is part of the sale process.

The mechanism that will enable all that to happen is set in proposed section 27B, which refers to the grant of a licence for a
forestry business. Subsection (1) says:

       Without limiting section 20(2), the corporation may grant a perpetual licence over all or any part of vested land --

(a)to establish, maintain and manage timber plantations on that land; and

(b)to take or convert forest produce on that land --

       and to do all other things necessary or convenient to be done for or in connection with, or as incidental to,
       paragraph (a) or (b).

The mechanism defines how the perpetual licences are to be granted. They are not being given away; they are to be sold, so
Victorians will benefit from the process. The bill goes on to say what happens if a licence is cancelled or surrendered,
stipulating that the land that was subject to the licence will revert to the Crown. The licences can be reassigned.

Proposed section 27E is important, having regard to comments often made by municipalities. It addresses two significant
issues in the debate. Proposed section 27E(1) says:

       Despite anything to the contrary in the Water Act 1989, a licensee of licensed land is liable to pay rates, levies, fees,
       charges and costs under that act as if --

(a)the land was not Crown land; and

(b)the licensee was the owner of the land.

Proposed section 27E(2) states:

       A licensee must comply with any relevant approved code of practice under Part 5 of the Conservation, Forests and
       Lands Act 1987 in relation to the licensed land and to forest produce on the licensed land as if the land was private
       land.

At long last the rates derived from the subject land will be payable to those municipalities. One of the things that has annoyed
municipalities intensely over the years has been their inability to derive rate revenue from the land. They will now be able to
do so once the licence is issued. Secondly, the Code of Forest Practices will apply to the land, which is significant in the
context of the debate.

Yesterday I met with Julie Constable and Kim Debenish, two South Gippsland people. It would be fair to summarise their
interest in this issue as being nothing less than passionate.

I say that with respect to them because I am sure their concerns are genuine. I had about 45 minutes or an hour with them
and we discussed a series of issues, the content of which I am making by way of a contribution; and the matters that I do not
deal with have already been debated by other members who have made contributions on the bill.

I refer to those people in the context of the provision of proposed section 27E(2) that:

       A licensee must comply with any relevant approved code of practice under Part 5 of the Conservation, Forests and
       Lands Act 1987 in relation to the licensed land and to forest produce on the licensed land as if the land was private
       land.

That is an important issue.

A licence, once granted, can be either surrendered or cancelled. Proposed section 27I refers to the land in question:

(1)If the Minister determines that vested land to which a licence applies is no longer used solely for plantation purposes ...

The intention is that the basic import of the legislation will be given effect. If people take out a licence to undertake the
purpose of forestry activity that is what they will be required to do. The bill requires that the licence must be maintained.

The next important provision is that contained in division 4 which refers to the all important issue of staff of the Victorian
Plantations Corporation.

Proposed section 49 provides that the list of corporation staff be prepared at the appropriate date of the legislation taking
affect and then, importantly, proposed section 50 deals with the circumstances which apply in the case of a transfer of
corporation staff. It is that provision to which the honourable member for Sunshine may have been obliquely referring and it
perhaps answers many of his concerns. It specifically says the accrued benefits travel with the employee at the time that
person is employed by the new entity.

One of the matters put to me by Ms Constable and Mr Debenish was that the bill had the capacity to bring about the sale of
land. That is not the case. Only licences can be issued -- no sale. There has been discussion about the 20 000 hectares of
land, and several members have referred to the area of land within the Strzelecki Ranges. I am advised by the VPC that
about 13 000 hectares comprising gullies and slopes cannot be logged under any circumstances because of the terms of the
code of forest practice.

Those areas are excluded from any concern which one may otherwise have about their being subject to being logged. There
is another 3000 hectares of roads and landings and areas of that nature; about 2000 hectares of eucalypt forest with a further
2000 hectares of previously cleared land that has not been reafforested. The main area is the 13 000 hectares which, by
definition, cannot be subject to the process of logging.

Concern was expressed during the representations made to me yesterday that in its original charter the VPC could only deal
with softwood. When one examines the 1993 legislation, Hansard and the general operation of the Department of Natural
Resources and Environment and the VPC after it was established, clearly this entity was to deal both with hardwood and
softwood.

Another concern raised was that only 8 per cent of the land within the Strzelecki Ranges was to be reserved for public
purposes as opposed to the 47.

3 per cent of Crown land reserved for public purposes around the rest of the state. If one took a snapshot of this area,

there seems to be an imbalance. There are unders and overs in this issue. Some areas are greater and some are less. Just to
the south of the area I have referred to, Wilsons Promontory comprises 50 000 hectares, or 125 000 acres, of land that is in
the form of state and national parks. There is a question about road access in the areas that are the subject of the legislation. I
am advised by the corporation that current public access will be preserved.

I heard the reference made by the honourable member for Gippsland West about the gipsy tours, if I can call them that. I am
advised by the corporation that there is no reason why they will not continue because there is nothing in the legislation that
will preclude that from happening.

A number of other matters were raised with me yesterday, but I am conscious that other members want to make a
contribution on the bill. The better course for me is to make contact with the people who saw me yesterday and I give an
undertaking that I will deal with the other matters they raised with me.

It is important that we examine the totality of the proposals contained in the legislation from an industry basis and what we
seek to achieve through the preservation, enhancement and future development of the industry for the betterment of
Victorians. Victorians, not only those in country Victoria, should examine this legislation on the basis that there are
protections contained within the bill not only from the way in which the industry operates generally through the involvement
of local government, DNRE and the operation of the code of practice. Those factors, taken in combination, serve to preserve
the position of the all important necessity to maintain the natural bush for future generations.

Ms GILLETT (Werribee) -- The Victorian Plantations Corporation (Amendment) Bill allows for the privatisation of the
Victorian Plantations Corporation and provides for perpetual licences over those plantations. It is the assertion of the
honourable member for Bundoora that the government proposes a trade sale of the VPC either as a whole or at any of three
regional parts of the state. The fact that one is Gippsland accounts for the honourable member for Gippsland South talking
as fulsomely as he has about the north, east and western areas of the region. It involves 170 000 hectares of Crown land,
our land, the land that is held for the benefit not only of ourselves but of our children and grandchildren. Most of it is state
forest that is used for softwood, pine, hardwood, or eucalypt plantation.

The VPC will be able to grant perpetual licences over this vested land. The only purpose allowed is plantation and licences
can be sold to new owners.

The issues the opposition perceives as being important can be summarised as follows: given that it is a vast area of public
land a number of significant issues concern public access to that public land, because traditionally many groups have used
those state forests.

They are four-wheel drivers, horse riders, shooters, deer hunters and bush walkers. As the public has not been engaged in
discussing the appropriate arrangements for the disposal of its asset, not the government's, the bill ought to be delayed in
accordance with the reasoned amendment moved by the honourable member for Bundoora.

Secondly, about 25 000 hectares of native vegetation exists in the plantation, most of it in gullies and steep slopes, especially
in the Strzelecki Ranges. Conservationists are opposed to the privatisation of the land because it will see the native
vegetation removed for plantation.

The issue comes back to a lack of public consultation. Crown land is being privatised, removing the possibility that in the
future some of the it could be removed from plantation and used for public purposes, for example the restoration of public
forests. A problem that constantly besets the government and characterises its performance is secrecy. Absolutely no
information has been released to allow the public to make its assessment, judgment or contribution on the benefits or
otherwise of the proposal.

A number of honourable members have already alluded to the Code of Forest Practices and it has been suggested that
everybody's compliance will be ensured. That is not necessarily right. There have been constant complaints about the VPC's
breaches of the Code of Forest Practices and that gives no-one confidence that the corporation will conform to the code after
privatisation.

There is local opposition.

One would have thought that the government, having been taught the lesson time after time, would have come to realise that
an inclusive approach -- an approach that seeks the views of the people the government represents and then provides
demonstrable evidence of those views having been taken into consideration -- is the best way to govern. Exclusivity simply
serves to put people offside, to disenfranchise them and to cause an electoral backlash, which I am sure the government will
feel in a number of sore spots over the next few years.

Consultation is one of the most important things that members of Parliament do. Most of our days are spent

talking with constituents, coming to understand their views and then representing those views in this place. That is the job of
a good local member.

If honourable members on the other side of the house are good local members, be they be backbenchers or frontbenchers,
they should not forget the lessons of opposition.

In the corridors of this place you often bump into honourable members from the other side of the house whom the
opposition respects and whose opinions are considered to be important. They remind us that they, too, were in opposition
for many years. Members on this side of the house take that on board because government members have been where we are
now. I fear that on occasions some of the newer members who have come to government too soon have not learnt the
lessons of opposition. Some of those honourable members may now be in positions where their lack of experience, insight
and depth and breadth of experience is manifesting itself in pieces of legislation of this sort.

I urge the government to consider the fine reasoned amendment put forward by the honourable member for Bundoora and to
support it.

Mr CLARK (Box Hill) -- I will respond briefly to some of the matters raised by members opposite and then speak about the
positives of the legislation, which appear to have been overlooked. The honourable member for Werribee spoke with some
passion, but I suggest it is passion that is falsely based.

The fundamental point about the legislation and the history of the VPC is that the corporation was established in 1993
following recommendations of the Land Conservation Council as to areas of public land suitable for inclusion in the VPC
estate. The VPC estate was essentially established in 1993. That exercise is not being undertaken now.

What is being undertaken now is the firming up of the title particulars and the boundaries of the surveys that have not been
done to date. It is a tribute to the work that has been undertaken by the Office of the Surveyor General, the Department of
Natural Resources and Environment, and the Department of Treasury and Finance. They have done a prodigious amount of
work in sorting out legal and survey issues that have been outstanding for many years, in some cases going back to the turn
of the century, and ensuring that legal boundaries and roadways are brought into alignment with the actual situation. That
has clarified issues that have been outstanding for many years, but it has essentially been a tidying-up process. It has not
been a process of major policy decision, albeit there have been some subsidiary questions along the way that needed to be
resolved. Once that fundamental point is made some of the arguments raised by honourable members such as the honourable
member for Werribee can be seen to be unfounded.

Much of the comment tonight has related to the issue of the Strzelecki Ranges and the VPC estate there. I will provide to the
house some of the figures that have been provided to me by officers of the Department of Treasury and Finance. As has
been referred to in the debate, the total area of the VPC and the Strzelecki Ranges is 40 000 hectares. Of that, 13 000
hectares consists of pine plantation, 7500 hectares consists of hardwood plantation, 3000 hectares consists of roads and the
like, and 2500 hectares consists of what is referred to as understorey species, which more or less equates to what would be
described as scrub, leaving a residual area of native vegetation of some 14 000 hectares. Of that, 12 000 hectares consists of
stream-side areas and gullies with a slope of greater than 20 degrees, which would not be permitted to be logged under the
Code of Forest Practices.

Information provided to me is that only 2.

2 hectares of native forest have been harvested to supply a mill that had an entitlement to receive timber under a contract
dating back to the 1950s, to fulfil an obligation that was originally undertaken by the state of Victoria. I am told that all
obligations under that contract have now been fulfilled and that mill has no further outstanding entitlement to receive timber.

I turning to other issues that have been mentioned. The honourable member for Bundoora referred to the issue of fences.
The legal advice obtained by the Department of Treasury and Finance is that the fencing legislation will apply to the licensees
of the VPC land as occupiers under the normal definitions with the consequence that the licensees and the adjoining
land-holder will each be required to contribute 50 per cent to the cost of the fencing in the normal way and that therefore the
concern raised by the honourable member is not a problem.

The honourable member for Sunshine raised a strange concern about additional land being converted to plantations. My
information is that farmers are increasingly choosing pine plantations among the many crops available to them because they
see them as having the potential to add value to their farms.

That leads me to the point I want to make about the potential benefits of the legislation. If one has regard to the great forestry
boom that has taken place in New Zealand following the privatisation of its plantations, one can see the considerable benefits
that are possible.

Various elements of the government's reform strategy have come together in that regard. Private sector plantation operators
will work with mills and others to add value to the timber product, and the product will be delivered by rail to private sector
ports at Portland, Geelong and Hastings and shipped efficiently and quickly overseas for export.

The potential benefits of the privatisation of the plantations are substantial. They offer the promise of increasing the vitality
of rural areas, which should be welcomed by all members, as the honourable member for Gippsland South has said. For all
those reasons I am pleased to support the bill.

Mr STOCKDALE (Treasurer) -- I thank honourable members for their contributions to the debate. Some members have
raised issues that on further examination appear to at least exaggerate the concerns that have been expressed. Nonetheless, I
am happy to have them investigated while the bill is between houses.

The bill gives the government the flexibility to deal with individual territory issues. Most of the issues were well dealt with
by the honourable member for Box Hill, who outlined the situation in the areas that have been the major focus of debate.

The bill is important because it realises Victoria's potential to be a major producer of softwood and hardwood for export.
The experience of countries such as New Zealand shows that the policy position that underpins the legislation can lead to
significant benefits in new jobs, new economic activity, new investment and new exports. Nobody can guarantee that the
initiative being taken in the bill will result in an increase in plantation activity, but both environmental and economic benefits
have flowed to the New Zealand community from the developments that have followed privatisation in that country.

I refer to the comments made about consultation. The measure has been coalition policy for many years and has been
repeatedly canvassed in the budget papers. In addition, there has been exhaustive consultation with groups at the local level
on issues such as access, recreational resources, the definition of the land vested in the VPC, and the nature of the
arrangements to be put in place to protect the interests of all the stakeholders.

In the end the government has to provide a commercial basis for the new plantation operators as well as the scope for further
expansion of the land under plantation. Collateral developments in relation to milling and other activities can also be
anticipated as the industry receives the advantage of an injection of new capital and, we hope, major new players with
significant international experience and the integration of those activities into the existing private plantations.

In the end it is the government's view that there is no justification for the government to be in an industry that is already
substantially private, where activity, competition and the introduction of new players as experienced in other countries have
produced enormous benefits for those jurisdictions. The government believes important public benefits will flow from the
implementation of the policies at which this bill is directed.

They are not incompatible with achievement of community and new environmental objectives at the same time, and indeed
the lands are substantially those already vested in VPC.

The honourable member for Box Hill in particular explained how the conflicts in relation to environmental standards and
interests that were raised by some members are groundless in light of the nature of the land that is not currently under
plantation.

I commend the bill to the house. The government will not be supporting the reasoned amendment.

House divided on omission (members in favour vote no):

                         Ayes, 50
                                   Andrighetto, Mr McLellan, Mr
                                   Ashley, Mr Maclellan, Mr
                                   Burke, Ms (Teller) McNamara, Mr
                                   Clark, Mr Maughan, Mr
                                   Coleman, Mr Napthine, Dr
                                   Cooper, Mr Paterson, Mr
                                   Dean, Dr Perrin, Mr
                                   Dixon, Mr Perton, Mr
                                   Doyle, Mr Peulich, Mrs
                                   Elliott, Mrs Phillips, Mr
                                   Finn, Mr Plowman, Mr A.F.
                                   Gude, Mr Reynolds, Mr
                                   Henderson, Mrs Richardson, Mr
                                   Honeywood, Mr Rowe, Mr
                                   Jasper, Mr Ryan, Mr
                                   Jenkins, Mr Shardey, Mrs
                                   John, Mr Smith, Mr E.R. (Teller)
                                   Kilgour, Mr (Teller) Spry, Mr
                                   Lean, Mr Steggall, Mr
                                   Leigh, Mr Stockdale, Mr
                                   Lupton, Mr Tehan, Mrs
                                   McArthur, Mr Thompson, Mr
                                   McCall, Ms Traynor, Mr
                                   McGill, Mrs Treasure, Mr
                                   McGrath, Mr W.D. Wells, Mr
 

                         Noes, 27
                                   Andrianopoulos, Mr Gillett, Ms
                                   Baker, Mr Haermeyer, Mr
                                   Batchelor, Mr Kosky, Ms
                                   Bracks, Mr Langdon, Mr (Teller)
                                   Brumby, Mr Leighton, Mr
                                   Cameron, Mr (Teller) Lim, Mr
                                   Campbell, Ms Loney, Mr
                                   Carli, Mr Maddigan, Mrs (Teller)
                                   Cole, Mr Mildenhall, Mr
                                   Cunningham, Mr Robinson, Mr
                                   Davies, Ms Savage, Mr
                                   Dollis, Mr Seitz, Mr
                                   Garbutt, Ms Thwaites, Mr
                                   Wilson, Mrs
 

Amendment negatived.

House divided on motion:

                         Ayes, 50
                                   Andrighetto, Mr McLellan, Mr
                                   Ashley, Mr Maclellan, Mr
                                   Burke, Ms (Teller) McNamara, Mr
                                   Clark, Mr Maughan, Mr
                                   Coleman, Mr Napthine, Dr
                                   Cooper, Mr Paterson, Mr
                                   Dean, Dr Perrin, Mr
                                   Dixon, Mr Perton, Mr
                                   Doyle, Mr Peulich, Mrs
                                   Elliott, Mrs Phillips, Mr
                                   Finn, Mr Plowman, Mr A.F.
                                   Gude, Mr Reynolds, Mr
                                   Henderson, Mrs Richardson, Mr
                                   Honeywood, Mr Rowe, Mr
                                   Jasper, Mr Ryan, Mr
                                   Jenkins, Mr Shardey, Mrs
                                   John, Mr Smith, Mr E.R. (Teller)
                                   Kilgour, Mr (Teller) Spry, Mr
                                   Lean, Mr Steggall, Mr
                                   Leigh, Mr Stockdale, Mr
                                   Lupton, Mr Tehan, Mrs
                                   McArthur, Mr Thompson, Mr
                                   McCall, Ms Traynor, Mr
                                   McGill, Mrs Treasure, Mr
                                   McGrath, Mr W.D. Wells, Mr
 

                         Noes, 27
                                   Andrianopoulos, Mr Gillett, Ms
                                   Baker, Mr Haermeyer, Mr
                                   Batchelor, Mr Kosky, Ms
                                   Bracks, Mr Langdon, Mr (Teller)
                                   Brumby, Mr Leighton, Mr
                                   Cameron, Mr (Teller) Lim, Mr
                                   Campbell, Ms Loney, Mr
                                   Carli, Mr Maddigan, Mrs (Teller)
                                   Cole, Mr Mildenhall, Mr
                                   Cunningham, Mr Robinson, Mr
                                   Davies, Ms Savage, Mr
                                   Dollis, Mr Seitz, Mr
                                   Garbutt, Ms Thwaites, Mr
                                   Wilson, Mrs
 

Motion agreed to.

Committed.

       Committee

Clauses 1 to 10 agreed to.

Clause 11

Mr STOCKDALE (Treasurer) -- I move:

1.Clause 11, SCHEDULE 7, PART 2, page 39, omit --Petticoat 1-- and insert --Petticoat 1A--.

2.Clause 11, SCHEDULE 8, page 42, omit -

       --Spargo19AAKorweingubooraCP11827--.

and insert -

       --Spargo19AAKorweingubooraCP117827--.

Amendments agreed to; amended clause agreed to; clauses 12 to 21 agreed to.

Reported to house with amendments.

       Remaining stages

Passed remaining stages.

Remaining business postponed on motion of Mr REYNOLDS (Minister for Sport).
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