Dáil Éireann debate -
Tuesday, 26 Feb 2013

Vol. 794 No. 1

State Forestry: Motion [Private Members]

Deputy Richard Boyd Barrett

I move:

“That Dáil Éireann:

notes, with dismay, the Government’s intention, under the troika deal, to sell the harvesting rights to our national forests;

notes that:

— Ireland’s publicly owned forests are one of our most precious natural resources and a priceless part of our culture and heritage, that must be nurtured and protected in the interests of current and future generations;

— since Coillte was created it has already sold over 40,000 acres of forest land; in 2009 it sold €33 million worth of forests, in 2010, €38 million and in 2011, €37 million;

— the national forests represent 11% of the landmass of Ireland, 745,000 hectares, 1.6 million acres; and that the Coillte estate owns and runs 7% of the landmass, which includes maintaining 11 forest parks, 150 recreation sites and 23,000 km of roadways;

— according to the Irish Forestry and Forest Products Association, IFFPA, in 2010 Irish forestry and the forest product sector generated €2.2 billion in annual output, 1.3%of GDP, and forest products to a value of €286 million were exported;

— the sector employs 12,000 people across the State;

— over 18 million individual visits are made to the national forest estate each year and according to IFFPA total economic activity generated by domestic users is an estimated €286 million and overseas visitors a further €138 million;

— in 2008, 517,000 tourist visitors participated in forest walking while holidaying in Ireland, spending an estimated €364 million;

— according to IFFPA, for every 15,000 hectares planted, 490 jobs will be created, indicating enormous potential for employment creation;

— much of the State’s forest land and associated industry and employment is based in rural Ireland and is a vital part of the rural economy;

— the percentage of afforested land in Ireland, at 11%, is well below the European average, representing an enormous unrealised potential for the State and its citizens to generate thousands of jobs and a reliable source of income;

— Ireland has agreed to the Europe-wide target of 30% forest land;

— a country such as Switzerland, which is half the size of Ireland, through prudent and sensitive management of their forestry, employs 100,000 people in the forestry and forestry related sectors, setting a standard that Ireland should seek to emulate;

— no other country in Europe has privatised state forestry or harvesting rights and higher levels of afforestation and related employment have been achieved where the state retains substantial ownership and management of the national forests;

— in Sweden part-privatisation of state forestry was recently reversed and the sector taken back into public ownership;

— in the United Kingdom recent proposals for the privatisation of state forestry were abandoned after there was enormous public outcry, leading to the establishment of an independent committee which recommended greater community participation and development of native species;

— there has been no consultation with stakeholders on the planned sale of Coillte harvesting rights and the potential impact of privatisation in terms of amenity loss, security of supply, environmental impact, job losses and other social and economic consequences;

— the intergenerational commitment implicit in the creation and stewardship of forests means that they are best owned by altruistic and long surviving institutions such as nation states;

— forests play a huge role in mitigating climate change and regulating the temperature of the earth’s atmosphere and, as a signatory to the Kyoto Protocol, Ireland is committed to reducing CO2 emissions; and that Irish forests stored 2.2 million tonnes of carbon in 2010 alone;

— the specific habitats of Irish forests will be threatened by privatisation, and it is unclear how the Government intends to address reforestation, species mix, environmental design, forestry inventories and other regulatory environmental issues which, if not planned, will have a detrimental knock-on effect on wildlife;

— privatisation of some state forests in New Zealand has led to major problems with public access, job losses and contracting of the wood processing sector;

— the 745,000 hectares, 1.6 million acres, of forests in Ireland represents an integral part of our heritage which should be developed and expanded; and

— the reported valuation by NewERA of Coillte harvesting rights of €700 million, which equates to approximately €580 per acre of trees, is almost certainly a gross undervaluation of these forests;

believes that the commercial pressure to make immediate profits that would be on any private investor who might take over the harvesting rights of Coillte would critically militate against the imperative to maintain public access to our forests, to invest in long-term sustainable management of those forests in the interest of the public and to generate much needed employment; and

calls on the Government to:

— abandon any plans to sell the harvesting rights of public forest lands under the control of Coillte;

— maintain Ireland’s public forestry in full public ownership in perpetuity;

— establish a major forum involving all stakeholders and concerned groups on the future of Irish forestry;

— rapidly accelerate afforestation in Ireland to at least the European average over the next ten years and to meet the existing targets of 30% forestation;

— establish a major programme of public investment and public works in Irish forestry with a view to creating jobs in this sector and boosting the ratio of forest related employment to forest acreage from the current low level to levels similar to countries such as Switzerland;

— put a particular focus on developing and expanding the cultivation of native hardwoods and developing local community involvement in the development of Irish forestry;

— improve the utilisation and development of public forestry with an emphasis on increasing our low forest cover with our native hardwood species which would help alleviate flooding, maintain soil fertility and reverse the acidification caused by conifers; and

— increase the use of timber as fuel for local communities by coppicing; protect water sources; and restore rivers and lakes to bring back freshwater fish stocks.

I will be sharing time, by agreement, with Deputies Catherine Murphy, Finian McGrath, Pringle, O'Sullivan, Tom Fleming and Mattie McGrath.

Our forests are one of our most precious resources. They are a priceless part of our national heritage and they are an invaluable economic asset. The Government's proposal to sell the harvesting rights to 1.2 million acres of public forests would be nothing less than a national betrayal and an act of cultural, economic and environmental sabotage and vandalism that is utterly unacceptable. There can be no justification for the selling off of our public forests, but to sell them off to pay off the gambling debts of bankers, speculators and bondholders represents an utter obscenity. More obscene, if this priceless asset is to be sold it may well be the same bankers and bondholders who helped to ruin our economy and the European economy that would end up owning our forests.

This is not scaremongering. Since Coillte was established by Ray Burke and Bertie Ahern, no less, it has sold 40,000 acres of public forest. By all accounts this has been done to plug a major deficit in the pension fund, a deficit that was probably generated as a result of speculation on the property bubble. The purchaser of much of that 40,000 acres of public forest was a body called the Irish Forestry Unit Trust, which includes Bank of Ireland, Allied Irish Banks and Irish Life, institutions which helped to ruin the country. Incredibly, now that the harvesting rights of the public forests are for sale it is possible that the banks which helped to ruin the country and whose debts have forced us to consider selling the forests could end up owning the forests. That would represent an obscenity beyond all obscenities. Another likely bidder if the harvesting rights go up for sale is a Swiss bank that manages wealth for the world's billionaires called Helvetia Wealth, a subsidiary of which, the International Forestry Fund, is headed up by none other than Bertie Ahern, the same man who set up Coillte and began the process of selling off public forestry. The idea that the former Taoiseach, responsible for the ruination of the country, could be a possible frontman for the takeover of Irish public forests by a Swiss bank is simply beyond belief. One possible outcome is that the banks which bankrupted the country and which have forced us to sell State assets could also force us to sell our forests and then the same people could end up owning them. One could not make it up; if this were in a novel anyone would say it was unrealistic.

More Government spin about ending bank guarantees, such as we heard today, or cries of triumph over the so-called IBRC deal will ring very hollow if, at the end of the troika programme, our country and economy have been stripped of some of our most vital natural resources, State assets and national heritage.

It says everything that if Ireland were to sell the harvesting rights to our public forests we would be the only country in the European Union to do so. In Britain, when David Cameron's Government attempted to discuss the idea of selling off state forests, there was a national outcry which forced Mr. Cameron to back off quickly. Indeed, as a result of the public consultation held in that country, as part of which 40,000 public submissions were made, almost every one of which was opposed to the plan to privatise British forests, the British Government was forced to develop a new strategy to invest in public forests and to begin to develop native species of trees to improve the management of the forests in the interest of the public. Sweden, a country which only partially privatised its state forests, was forced within a few short years to take them back into full public ownership because of the public outcry and the failure of private owners to manage them properly.

Let us consider what happens outside of the Continent. Even in New Zealand, one of the countries often held up as an example of where privatisation has occurred, only a small part of the state forestry was privatised and the results have been very damaging indeed. There have been major problems of public access to New Zealand's now-privatised state forests. Thousands of jobs have been lost. Major damage has been done to the sawmill sector. There has been a considerable outflow of profits from the country, moneys which used to stay in New Zealand.

There is absolutely no doubt that if the Government takes the unprecedented step of selling the harvesting rights of our State forests we will see the same damage done to this vital natural resource and element of our heritage. Such a move will threaten public access. It will lead to job losses. The Irish Timber Council stated today that it estimates there could be 2,500 direct job losses if this plan goes ahead. It will endanger security of supply to the sawmill industry. It will endanger biodiversity and the environmental integrity of our forests and natural amenities. It will seriously endanger our climate change strategy, as part of which afforestation and the use of forests to develop carbon sinks is a key component.

As Peter Bacon pointed out today it is likely that the State would actually pay financially to pick up the tab for what would be left of Coillte in terms of the deficits and debts the company has. At every level we stand to lose, economically, culturally and socially, if we privatise the forests. There is simply no argument whatsoever.

There is also a serious question about the undervaluation of this vital asset. The suggested figure for the sale of the harvesting rights is between €600 million and €700 million. For 1.2 million acres this works out at approximately €580 per acre. Even I, as someone not familiar with land values in rural areas, understand that €580 per acre represents a giveaway price for a valuable resource. It is absolutely unconscionable for us to do this.

The alternative is to retain the State forestry in public hands and to develop and expand public forestry. We should develop a major public works programme that could put thousands of people back to work. We know that hundreds of jobs can be created and we have figures showing that for every 150,000 hectares it is possible to create approximately 600 jobs. If we set out to meet the 30% target of afforestation to which we have signed up, we could create tens of thousands of jobs and we could probably get money from the European Investment Bank on the basis of putting forward a business plan to meet that target.

We could be creating jobs, increasing revenue and safeguarding our forest heritage and a vital natural resource for this State.

I appeal to the Government to back away from this proposal and protect our State forests. People will be gathering outside the Parliament tomorrow to appeal to the Government to do that. I hope the Deputies opposite will support our motion and withdraw their amendment.

Deputy Catherine Murphy

I thank the United Left Alliance Members for putting forward this motion, which I am happy to support. The sale of harvesting rights by Coillte will have a detrimental effect that is far more costly to us than any upfront income could ever offset. Coillte is an example of a strategically important asset that offers several major benefits to the Irish economy and environment. However, these benefits are not being considered by the Government in advance of the sale. Coillte has not yet realised its full potential. The company could diversify into providing fuel for our fledgling renewables industry as well as enhancing the public amenity aspects of Coillte lands.

I will speak on another occasion about the climate change Bill, the heads of which were published today, but it is disappointing in many respects. By acting as a carbon sink, Irish forestry could play a significant role in helping us to achieve our 2020 emissions reductions targets. We have international and EU obligations to meet those targets. It is estimated that Coillte forests currently store 10.5 million tonnes of CO2 and the current stock of trees can sequester up to 1.1 million tonnes per year. This offers a clear opportunity to use our natural resources wisely in order to meet our international obligations without having a heavy impact on the ordinary operations of Coillte, provided the company maintains a healthy replanting policy. Coillte grows an important renewable resource. Wood pellets are a by-product of the timber industry and there is also potential for biomass production.

The company sustains employment in rural areas and as these jobs are not the type that can be developed in urban areas, it creates a balance. Up to 80% of the timber it produces supplies the indigenous market, but the sale creates the potential for putting these products on a ship so that some other country can sell them back to us in the form of cheap furniture. This makes no environmental sense. If we experience an oil shock, for example, timber will become much more expensive. We currently have a measure of control by virtue of the fact that our timber is locally supplied. Privatisation could be detrimental to Irish sawmills and panel board mills, which employ up to 1,800 people.

Ireland's afforestation policy calls for 17% forestry coverage by 2035 and yearly afforestation rates of 20,000 ha per annum until 2048. We would in effect be abandoning those goals if we sold our harvesting rights. Ireland is already one of the least forested countries in Europe. This is not a good deal for the State. The Bacon report pointed out that the State would lose all the profits from timber sales even while retaining the deficit funding requirements, including the company's pension liabilities. The proposal does not make economic or environmental sense. Coillte is an important strategic asset which we need to retain.

It is more difficult to estimate the potential income from the public amenity aspect of our forests, but the Dublin Mountains Partnership represents an important development in this regard. In my constituency of Kildare North, Donadea Forest Park is very popular. People visit the park every weekend and it is widely used over the summer. The Government's plan creates the prospect of heavy industrial machinery mixing with people. The landscape will no longer resemble a forest park. One can easily visualise the loss of that amenity. This issue urgently needs to be included in the broader equation.

Deputy Thomas Pringle

I welcome the opportunity to speak in support of this motion and I commend the ULA Members on their tabling of it. The sale of the harvesting rights by Coillte could go down as one of the most short-sighted decisions by this most short-sighted of Governments. The decision to sell State assets is a knee-jerk reaction on the part of the Government, made at the behest of the troika, to pursue an agenda of privatisation and liberalisation. How can the sale of our forestry rights over the long term assist the recovery and development of our State? It will merely open up the resources of our citizens to private capital.

There are four main reasons Coillte should not be sold. The company supplies 80% of the timber used by sawmills in this State, and if the sale proceeds there is no evidence to suggest this supply chain will be maintained. Evidence from other countries, such as New Zealand, indicates that the opposite will be the case, with raw wood exported and work lost by domestic mills. The sawmill industry currently employs approximately 1,800 people and generates wages of €90 million annually. Up to 3,000 more jobs could be threatened from the sale of Coillte's harvesting rights. Our forestry could also support the development of a wood biomass industry that, if nurtured, could be used to strategically change the direction of home heating in this country. We import more than €1 billion in home heating oil annually but we produce more than five times the amount of wood necessary to heat the entire country. This would be a carbon-neutral policy. It is ironic that on the day the Government published the heads of the climate change Bill the sale of this important source of carbon-neutral heating is being discussed. Coillte has control over 7% of the landmass of this State, much of which is located in areas suitable for the development of wind energy. If harvesting rights are sold, access to this resource will be lost and the opportunity to meet our climate change obligations could be greatly reduced. Realigning Coillte and the ESB, along with Bord Gáis, with a view to maximising renewable resources could be of great value to Irish society. The State could generate considerable revenue in dividends from semi-State companies, which would do more for debt reduction than any short-term gain from the sale of the companies concerned.

Should Coillte be sold, there will continue to be a need to maintain the public forests that provide social amenities. The proposals for the sale do not contain any provision for the amenity value of our forests. Their future maintenance will have to be funded from State resources rather than Coillte revenues. What will be the future for open access to forests if this sale proceeds? Are we to believe that investment funds will take on a public interest role in allowing public access to our forests? They will certainly not do so without being paid a premium by the State.

The proposal to sell the harvesting rights to Coillte forests is a crazy solution to our debt problems. It is not based on a realistic examination of the value the company can bring to our economy and society. IMPACT has published a report by Peter Bacon which estimates the net present cost of the sale at more than €1.3 billion. This is far higher than any estimates of the amount the sale could realise. The sale will cost more than that, however. The loss of opportunity for Irish people to benefit from their own resources will be far more costly. The Government should go back to the troika to show it how we can maximise the development of our semi-State companies. The troika would find it difficult to reject a plan that shows how the timber products sector and biomass and renewable energy potential of Coillte can play a huge role in our economic recovery and the remodelling of our economy. Rather than meekly accepting the dictates of the troika, let us develop a plan that will benefit the Irish people. If our so-called partners are really interested in a robust Irish economy that can grow for the future benefit of its citizens, they will be happy to work with such a plan.

Deputy Finian McGrath

I thank the Chair for the opportunity to speak on this motion on Coillte and our national forests. I also want to commend and thank Deputy Richard Boyd Barrett and the ULA on bringing forward this motion at this crucial time for the economic future of the country.

This motion is a wake-up call for every citizen of the State. It calls on them to be vigilant and on their guard because while it is now the harvesting rights of Coillte that are being sold, if we do not fight this, there will be a complete sell-off of Coillte in the future. We are all aware of what happened in the past with regard to natural resources like oil and gas. Now is the time to fight, speak out and protect our natural resources. The sell-off has begun already, with harvesting rights valued at €37 million sold in 2011. The Government needs to wake up and smell the coffee before it is too late and too much damage is done to our forests. Not alone that, the sell-off is also hugely damaging for the economic future of our country and of our children. There is no point in talking about a jobs plan this week, while at the same time destroying or selling an asset like our forests, which have huge potential to create more jobs. Let us deal with the economic arguments and facts tonight and let us hope the Government will listen to common sense and consider the economic reality of the motion.

It is with dismay that many of us view the Government's intention to sell the harvesting rights to our national forests. Ireland's publicly owned forests are one of our most precious natural resources and a priceless part of our cultural heritage. We are alarmed that since Coillte was created, it has already sold over 40,000 acres of forest land. In 2009 it sold €33 million worth of forest, in 2010 it sold €38 million worth and in 2011 it sold €37 million worth. The national forests represent 11% of the landmass of Ireland, 745,000 hectares or 1.6 million acres. Coillte owns and runs 7% of that, including maintaining 11 forest parks, 150 recreation sites and 23,000 km of roadway.

According to the Irish Forestry and Forest Products Association, the IFFPA, in 2010 the Irish forestry sector generated €2.2 billion in annual output - some 1.3% of GDP and forest products to a value of €286 million were exported from the country. The sector employs 12,000 people across the State. This is significant employment at a time when the country is crying out for jobs. There is the potential in the area to create five times that number of jobs and to bring the number up to 60,000. Over 18 million individual visits are made to national forest estates each year. According to the IFFPA, total economic activity generated by domestic users is an estimated €286 million. Overseas visitors generate a further €138 million. These are amazing figures and any government with common sense should look at them and see the potential. In 2008, some 517,000 tourists participated in forest walking while holidaying in Ireland, spending an estimated €364 million in the real economy.

According to the IFFPA, for every 15,000 hectares planted, some 490 jobs will be created, indicating enormous potential for employment creation. We are worried about our forests, but there is also an issue of jobs and that is the issue we need to focus on tonight. Much of State forest and land associated industry employment is based in rural Ireland and is a vital part of the rural economy. We are all aware many of our rural areas could do with a lift as they will not all get IT companies or multinational chemical companies. The Government must wake up and consider new ideas. It must listen to the sensible proposals being made.

The Government has criticised the Opposition on many occasions for not putting forward sensible suggestions. The motion put forward tonight by Deputy Boyd Barrett and the Independent Members and the Technical Group puts forward a strategy to deal with this natural resource and with the job situation. The percentage of our forested land, at 11%, is well below the European average, indicating enormous unrealised potential for the State and citizens to generate thousands of jobs. A country such as Switzerland, for example, through prudent and sensitive management of its forestry sector, employs 100,000 in that and related sectors, setting a standard Ireland should seek to copy. This should be considered seriously.

No other country has privatised state forestry or harvesting rights. Higher levels of afforestation and related employment have been achieved where states retain substantial ownership or management of this sector. In Sweden, part privatisation of state forestry was recently reversed and taken back into public ownership.

These are our ideas. This motion is about our natural resources. It is about the future of our country and our children. Above all, it is about putting forward sensible solutions for the provision of jobs.

Deputy Tom Fleming

Coillte controls 11% of the landmass of the Republic of Ireland. Our climate is ideal for soft wood trees and we have three times the growth rate of the European continent and Scandinavia, where the average amount of forested land is close to 40% of total landmass. The potential of Coillte is unexploited here. The State has set a target of 17% afforestation by 2035 and Coillte, the forest service and Teagasc are endeavouring to promote afforestation schemes to farmers and landowners. An intensive and strategic approach should make it possible to extend the planted landmass to over 30% by 2035, doubling the targeted 17%.

Unarable land prices have plummeted since the boom and this is now an ideal time for the State to invest, dramatically develop afforestation and cater for the growing market demand for timber. The Irish sawmilling sector employs 2,500 people and is an integral part of the Irish forest products sector, which employs 12,000 people in total and generates approximately €2.2 billion annually, approximately 1.3% of GDP. The majority of jobs within the sector are located in rural areas where this indigenous product is a boon to local economies. Tourism and recreation are major beneficiaries of our forest resource, which is ready made for nature trails, hiking and biking, which are enjoyed by young and old alike. Walking is a very popular visitor attraction here and Coillte, with over 7% of the landmass, operates an open door policy of its ready-made natural amenity. Hikers are free to use Coillte forests for recreational purposes at all times. Increased afforestation also helps the environment, specifically in the context of carbon storage. Trees remove CO2 from the atmosphere and release oxygen, counteracting the greenhouse effect and helping towards Ireland's commitment under the Kyoto Protocol.

The trade union IMPACT recently commissioned economist Peter Bacon to draft a report on the sale of the Coillte assets. He claimed this sale makes no financial sense and amounts to a liquidation of the profitable asset. This independent report of the sale is based on a possible scenario that would involve rights to 75% of Coillte production being sold for an 80-year term. The report states the sale would effectively liquidate Coillte as a viable commercial entity. A price of €1.3 billion would be needed to make up for the loss of 80 years of profits and Coillte would need to sell at €78 per square metre, well above current or recent prices, to cover all of the liabilities associated with the company. This occurs because privatisation would mean the loss to the State of the future Coillte profits, the loss of amenity value of State-owned forestry and because of the company's debt of €172 million which must be repaid. In addition, there is an employee pension deficit of €130 million, which will most likely have to be met by the Exchequer if Coillte is sold.

A sale would raise cash upfront but it would end up costing taxpayers over the long term. Under new owners the timber from the forests, which is currently processed in Ireland, could be exported for finishing abroad, resulting in job losses.

The report also stated the sale of Coillte would raise enough cash to repay three weeks of interest on the national debt, if half of the proceeds went towards servicing the debt. It also stated the half share earmarked for infrastructural projects could generate a 6.5% return, but that would be less than the return from holding on to Coillte. For these valid reasons, we must retain our harvesting rights. It would be folly to do otherwise.

I would like to conclude by mentioning an initiative in my constituency involving the production of wood chip by farmers. A wood chip boiler was recently installed in the new Kenmare Community Hospital. This is a wonderful advancement. The farmers are also supplying this low cost fuel to the domestic sector, including many local houses. It is a great boon for everybody and good for the environment.

Deputy Maureen O'Sullivan

Tá sé oiriúnach agus tábhachtach go bhfuil an t-ábhar seo á phlé againn anocht agus amárach. Ba mhaith liom aitheantas a thabhairt don Teachta Boyd Barrett ar son na hoibre a rinne sé agus a rinne an United Left Alliance chun an díospóireacht seo a chur ar bun. All of this stems from the EU-IMF memorandum of understanding which states Ireland has to generate €3 billion from the sale of State-owned assets and companies. I understand some significant reports on this matter have yet to be published and it would be wise to examine them when they are available. Perhaps the Joint Committee on Agriculture, Food and the Marine should have a role in inviting all relevant parties to an open and frank discussion at that forum. It is good that we are starting that process by airing the views of Deputies.

The first question we must ask is whether the sale of the harvesting rights would make sense economically or financially, or from the perspective of our heritage and culture. We need to highlight the need to stress-test the implications of the full or partial sale of harvesting rights for the future commercial viability of the sector, including the sawmill sector. Like other Deputies, I have read Dr. Peter Bacon's report assessing the consequences of the proposed sale. I went to the Oireachtas audio-visual room today to hear some of the comments he had to make. His report makes some very logical arguments against the sell-off of harvesting rights, purely for economic reasons. He suggests this measure would cost the State money, rather than generating income for it. He provides some interesting statistics in support of his position: the loss of funds from Coillte's profit flow would cost the State €565 million; in addition, the company's deficit funding requirement is €313 million, its debt liability is €172 million, while its pension liability is €130 million. The economic cost of the job losses or the loss of the amenity value must also be considered.

We know that Coillte is a significant employer in rural areas. Rural Ireland has been subjected to many other losses without the potential for increased unemployment as a consequence of the threatened loss of jobs. We also know about the economic risk to the timber processing sector. At today's briefing I listened to representatives of the Irish sawmill sector talking about the job losses it could face. The provision of logs for Irish sawmills by Coillte will be interrupted, at the very least, if the privatisation goes ahead. These well established sawmills have long-standing relationships with their customers. There have been far too many examples in this country of white collar crime, unregulated industries and cartels. There is a real concern that more small businesses will be overpowered if these rights are sold. We know that job losses lead to further costs for the State.

Can we trust a private profit-driven company to maintain the country's "open forest" access policy? If that policy is not continued, it will affect culture and heritage tourism from foreign and domestic sources. We know the extent of visitor numbers. There are real concerns that public access could be severely restricted. There are international examples of where this has happened and where privatisation was reversed to encourage greater community participation. I have listened to organisations such as the Woodland League and Mountaineering Ireland that have serious concerns about public access when these decisions are commercially driven. I doubt that recreation is high on the agenda of a profit-driven company. At a time of recession, austerity and budget cuts, we should not discourage a free activity that is good for our physical, emotional and mental health.

Coillte has not covered itself in glory. It has serious questions to answer about the extent of the grants it received from the European Union and the manner in which it was established in 1989. What was the exact size of the land bank gifted to it? What other assets came with it? Do we know what is beneath the trees? Has this been studied? Do we know what mineral rights we are giving away also? Why is Coillte excluded from the scope of the freedom of information regime? In what capacity did it sell land in County Mayo to Shell? It has also sold land to the National Roads Authority. This has had a serious impact on part of our cultural and historic heritage.

The loans to Coillte approved by the Dáil bear no relation to the single contribution the company has made to the Exchequer. As Deputy Richard Boyd Barrett has pointed out, serious issues arise with regard to Coillte's relationship with the former Taoiseach, Bertie Ahern. As has been mentioned, the country's level of forestation is way below the European average, which means the country has massive potential in this respect. If these rights are sold, our natural environment will be undermined in a serious way. Our efforts to meet the current and future Kyoto Protocol targets for carbon emission reductions will also be hindered.

Article 45.5 of the Constitution provides that "the operation of free competition shall not be allowed to develop as to result in the concentration of the ownership or control of essential commodities in a few individuals to the common detriment". I see forestry as an essential commodity that should be protected for the common good. Our forests were established using public money for social and economic purposes. An interesting Bill proposed in 1975 by the former Minister, Mr. Justin Keating, would have ensured a corporate tax rate of 50% would have applied in cases of this nature. However, it did not get anywhere. I hope we do not make the same mistakes we made with gas and oil resources in the case of our forests.

Deputy Mattie McGrath

I am delighted to speak to the motion. I compliment Deputy Richard Boyd Barrett and his colleagues on proposing it at this important time. A copy of the Government's latest Action Plan for Jobs was placed in my pigeon hole this evening. The sector we are discussing employs approximately 12,000 people across the State. Over 18 million individual visits are made to the national forest estate each year. In 2008 some 517,000 tourist visitors participated in forest walks while holidaying in Ireland, spending an estimated €364 million. What more do I have to say? Over 300 actions are set out in the Government's action plan. It is just a farce. We have to protect this asset.

I salute the hard-working men who pioneered the State forests in the days of the Forest Service. I salute the men and women who today work in our forests and their families. They nurture natural habitats and look after forest roads and drains. They co-operate with community groups and everybody else to provide access. They are part of the community and rural Ireland. We must "cry halt" at this time to ensure this valuable natural resource is not sold. It is part of the heritage of being in this country. When I look across at those on the Labour Party benches, I am reminded of the policies they are supposed to have. They should be against all of these issues, but here we are. I share the suspicions expressed about the connections of the former Taoiseach, Bertie Ahern, with this conglomerate.

Deputy Michael Creed

The Deputy supported him for long enough.

Deputy Mattie McGrath

I am also worried about the people he appointed to high places. What is going on in this country? It is a complete sell-out. It is disgraceful and must be resisted at all costs. If we look at what was tried in this sector in Sweden, we will see that those involved failed and are now handing it back.

I would like to mention two organisations in my county, Aherlow Fáilte and Knockmealdown Active. The mountain ranges where they are based - the Galtee Mountains and the Knockmealdown Mountains, respectively - are heavily covered with Coillte woods. They could not have developed walk ways, cycle ways and mountain trails in both ranges without the excellent co-operation they have received from Coillte. The people who volunteer to assist both of these community groups nurture our heritage and develop our tourism projects. They will be locked out and told "to hell or to Connacht" when these rights are sold to private interests. The same thing happened in the case of Eircom and we know how it was plundered. The same will happen when responsibility for Irish Water is given to Bord Gáis. I was contacted this morning by a contractor who had applied to work as a plumber to lay pipes with the new water company. I hope the Minister for Public Expediture and Reform, Deputy Brendan Howlin, is listening to this. He was told he would need to have a turnover of more than €400,000 per annum.

This is all about big people getting control and keeping small people down. We cannot have this and must not have any more of it. We are paying enough homage to the troika. Our people are in enough misery without selling their assets and china. They have taken enough from us. We have bailed out the banks. Are we going to allow some of them to gain ownership of Coillte? We know that would result in people being locked out of the woods. Trenches will be dug across the gateways and barriers and signs saying "no trespassing", "no walkers" and "no hikers" will be erected. The birds will not be allowed to fly in. They will try to stop the deer from grazing there.

The Government has a fight on its hands. I am ashamed to think the Labour Party representatives in government are carrying on in this way with this kind of proposal. The Labour Party is no more than a mudguard for Fine Gael as it tries to sell our natural resources.

After all their talk for the past 14 years, I believe these two parties want to punish the electorate for banishing them from government for those 14 years. They have got their mandate now but they seem to want to punish the people on a daily basis - if it is not this, it is something else. I say to the Minister that he has something else to fight for.

Minister for Public Expenditure and Reform (Deputy Brendan Howlin)

I move amendment No. 1:

To delete all words after “Dáil Éireann” and substitute the following:

“recognises that for the duration of the EU-IMF financial assistance programme the Irish authorities have taken, and will continue to take, all the necessary measures to ensure a successful implementation of the programme and to minimise the cost to the taxpayer, while protecting the more vulnerable;

- in this context, welcomes the fact that half of the proceeds from the Government’s State assets disposal programme will be available to the Government for reinvestment in job-rich projects to help job creation, with the other half, while eventually destined to reduce public debt, also being available, in the first instance, to be constituted as a fund to underpin additional lending into Ireland, for example, by the European Investment Bank, in support of further investment in job-creating initiatives;

- further recognises that the use of the asset disposal proceeds in this way, for stimulus and, in time, for debt reduction, will support economic growth and preserve long-term fiscal sustainability, including programme targets;

- notes the Government’s decision that the harvesting rights to Coillte forests be considered for sale and, at their request, the National Treasury Management Agency, via its NewERA Unit, has been actively engaged with Coillte, the Department of Public Expenditure and Reform and the Department of Agriculture, Food and the Marine over recent months to examine the financial and other implications of a potential transaction;

- acknowledges, from evidence gathered from similar transactions completed in other jurisdictions, that a transaction can be structured in such a manner as to include provision for the maintenance of the Open Forest policy, reflecting public access to recreational land, the continuation of the existing replanting obligations and the incorporation of biodiversity requirements; and notes that it is the Government’s intention that similar appropriate provisions will be included in any sale of Coillte harvesting rights; and

further notes that:

— the process has also included engagement with potential acquirers of harvesting rights, when requested by them in accordance with the published Government protocol; and the two Departments and NewERA have also, when requested, met with interested stakeholders to discuss their position on the sale of the harvesting rights;

— the steering group, including NewERA, is working closely with Coillte and its board in giving consideration to the implications of a transaction for the company and also for the wider forestry sector, taking account of a series of reports commissioned by Coillte in 2012 from specialist external advisers; and

— as part of this process, the steering group have met with the Coillte group of unions in January where they outlined the process involved and received the view of those unions and copies of the report by Peter Bacon, which was commissioned by the unions; and it was agreed that a further meeting could be held as and when appropriate.”

I wish to share time with Deputies Emmet Stagg and Andrew Doyle.

An Leas-Cheann Comhairle

Is that agreed? Agreed.

Deputy Brendan Howlin

I apologise for being late but I was at the Economic Management Council. I would not have missed the colourful contribution of Deputy McGrath in normal circumstances. I see he is now moving into the sphere of the Sinn Féin Deputies, telling the troika to take a hike and take their money with them.

Deputy Mattie McGrath

They have enough taken without taking our natural assets.

Deputy Michael Creed

It is his lot that brought them in.

Deputy Brendan Howlin

It is lovely to hold that view. Deputy Mattie McGrath supported Bertie and all his works and pomps because he thought he was a great fellow, and he voted to rescue the banks and bankrupted the country. He was part of that cabal. Mind you, he did abandon ship when he saw the leak coming.

Deputy Mattie McGrath

There is some cabal right now.

Deputy Brendan Howlin

Let me deal with the motion because it is a very important and significant issue that is before the House. I would like in the first instance to outline the background to the proposed sale of - the Deputies might listen to this - the harvesting rights, in order to put this discussion into context. The background is, essentially, that the Government was faced with unprecedented budgetary challenges, the result of which is that the State is currently dependent on financial assistance provided, as everybody in the House knows, through the EU-IMF funding programme. There is still a significant gap between Exchequer revenues and what we spend every day. This is unsustainable and has to be addressed. Every day, we are making decisions - difficult, hard, uncomfortable decisions - to address that and put it right, and to fix the broken economy the Government inherited two years ago. As I have said, in these circumstances, it would be negligent for the Government not to at least carefully examine all reasonable means to raise revenue and to reduce expenditure, including the release of some of the value across a wide range of our State assets.

This particular option was carefully examined and, as announced in the statement I issued in February 2012, the Government decided consideration would be given to the sale of some assets of Coillte, excluding the land, which would obviously always remain in State ownership. This was reflecting the concerns expressed at the time about the sale of such a large area of State lands. At all stages in the process, issues of major importance have been identified and efforts made to address any impediments or legitimate concerns of Members of the House or the general public. In particular, the Government was conscious of the level of concern expressed about the ownership of the land. It was agreed at that initial stage that Coillte would be included in the asset disposal programme, and further consideration was deemed necessary to identify the appropriate asset which could be sold within the entity that is Coillte.

The outcome of that consideration was that a feasible option to realise value from Coillte would be a sale of the harvesting rights to the forests. It is a commercial forestry company. It grows trees to sell them, like a farmer selling his corn - naturally enough, as that is what the trees are for. The issue then is-----

Deputy Richard Boyd Barrett

In this case, it is somebody else selling them.

Deputy Brendan Howlin

One cannot sell trees annually. They do not grow miraculously or pop up overnight. The issue then is whether we should sell them in an incremental way or sell them in advance to get the money the country desperately needs right now. These are the considerations we examined, which is quite proper and appropriate. There would be appropriate conditions attaching, including in regard to the continued public amenity, which is hugely important to every Deputy in the House, guaranteed access to the forests - we will not be keeping out the birds, obviously - replanting obligations, and commitments to minimum and maximum annual harvesting volumes and to ensuring continuity of supply to the timber processing sector. These are all legitimate and real concerns that had to be addressed individually. The Government accordingly agreed in principle, in June of last year, to the sale of the harvesting rights to Coillte forests as the best means of extracting value from Coillte in the short to medium term.

The Government has since continued that process and we have advanced with very great caution in regard to this option. We have undertaken further detailed analysis, carried out by the NewERA entity we have created, which has proven to be a very valuable new oversight body, in conjunction with Coillte itself, the Department of Agriculture, Food and the Marine and my Department to identify the forestry assets involved, determine their value and consider all the range of issues associated with the sale of the harvesting rights.

In addition, a number of detailed financial, technical and other specialist reports have also been prepared for Coillte by external specialist consultancy bodies in full consultation with the board of Coillte and its executive management. Coillte has been integral to this process through the provision of data and relevant background information. As the House is aware, Coillte is a commercial company trading in a competitive environment, so matters relating to the performance of its various businesses and its portfolio are commercially sensitive, and it is, therefore, not appropriate to comment publicly on the analysis taken to date.

The Government is fully conscious of the concerns that have been raised not only by Deputies opposite, although I acknowledge them and accept they are real, but by the general public, recreational groups, the timber processing sector and trade unions. NewERA, the Department of Agriculture, Food and the Marine and my Department are fully aware of the findings of the report by Peter Bacon and Associates, commissioned by IMPACT, containing the "Assessment of the Consequences of the Proposed Sale of Coillte's Timber Harvesting Rights", which was published on 10 January this year. However, the authors of the IMPACT-commissioned report have not had the opportunity to consider the very detailed information available to the State on foot of our due diligence, and its analysis of the potential costs and proceeds from a harvesting rights transaction appears to be based on historical, publicly available information, as well as a number of assumptions in regard to transactional structure and sale conditions that are not necessarily in line with the proposals the Government is currently developing.

This process is complex and I want to assure the House that the Government will continue to proceed with caution. I have already assured the House, in regard to the sale of other State assets, that the Government will ensure that all of the implications of each asset disposal will be very carefully considered with a view to mitigating any potential negative impacts associated with any disposal. In the context of Coillte, this will include the need to ensure the stability of the entire timber industry, which is very important for the jobs associated with the industry, maximising the recreational and biodiversity value of Ireland's forests, where there is greater potential than is currently being exploited, and ensuring the continuity of access to the forests as a public amenity. As with all State asset sales, this sale will only proceed if it makes economic and strategic sense for the Irish people. I give the House that commitment tonight.

I would also like to remind the House of the use to which the proceeds of such asset sales may be put, as provided for under the revised programme the Government has now agreed. As agreed with the troika, half of the proceeds will be available to the Government to fund employment enhancing projects of a commercial nature, with the other half, while destined eventually to pay down debt, also being available in the first instance to constitute a fund to underpin additional lending into Ireland. This is to fund our infrastructure and a stimulus package and to create jobs, and is a creative way of using money.

I have concentrated thus far on the background to, and status of, the State assets disposal programme as it relates to Coillte. However, I am, as is the Government, also cognisant of the importance of the forestry sector to the economy, society and the environment. The motion by the Technical Group highlights some aspects of this contribution, including the numbers employed in the sector, the value of exports by the sector and the job creation potential. I also know that Irish sawmillers have worked hard in recent years to develop new products and markets, and it is encouraging that their efforts, along with those of all of the stakeholders in the sector, have resulted in a vibrant and export-oriented forest production sector.

The State has also been involved in this process as it has made a significant investment in the development of forestry over the last number of decades, primarily through the provision of funding for the afforestation grant and premium schemes and other support schemes operated by the Department of Agriculture, Food and the Marine. This Government has maintained the level of funding for the development of forestry in recent years despite all the economic pressures, which shows a strong ongoing commitment to forestry in Ireland. The outcome of the investment in forestry to date has been increased participation of private landowners in forestry. I understand there is a significant amount of privately owned forestry now approaching first thinning, and in the years ahead more privately owned timber will become available to the market. Thus, the mobilisation of privately owned timber in itself creates opportunities, which the industry, in conjunction with Teagasc, is seeking to maximise.

While Coillte is currently the main supplier of timber to the timber processing sector, it should not be overlooked that the privately owned timber resource will be becoming available over the next number of years. I appreciate that this will be a gradual development but, in time, it should contribute to competitiveness in the supply of timber. My colleague, the Minister for Agriculture, Food and the Marine, in a reply to a parliamentary question last December, stated clearly that the Government will not do anything that will undermine or significantly damage the timber or sawmill sectors in Ireland, and this remains the position.

Another important consideration, which was also mentioned by the Deputies in their motion, is the level of forestry cover in this country. The State, through its funding of an afforestation programme, has facilitated a sizeable increase over the past number of years. In this regard, it should be noted that it is a demand-led scheme, so the planting level each year is determined primarily by landowners and their selection of forestry as an enterprise in which they wish to participate. While afforestation is promoted on an ongoing basis, it is also essential to maintain the existing level of forestry. In order to preserve the forest estate and protect the considerable State investment in forestry to date, it is the policy of the Department of Agriculture, Food and the Marine that forestry plantations must be replanted after clear fell has taken place. On this basis, only general felling licences are issued for normal commercial forestry operations, and under the Forestry Act 1946 such licences carry a compulsory replanting condition. This has resulted in an increase in forest cover from a disastrously low level to 11% at present. I acknowledge that this is still low by European standards, but it reflects a greatly increased level of forestry cover in the past 20 years.

The maintenance and increase of forestry cover in Ireland is also essential for climate change mitigation purposes. Forests play a significant role in mitigating climate change by removing carbon dioxide from the atmosphere and converting it to carbon, which is then stored in the wood and vegetation of trees. In 2008, 2009 and 2010, the net contribution of Ireland's Kyoto-eligible forests amounted to about 8.6 million tonnes of CO2 over the three years. Assuming a carbon cost of €14 per tonne, this represented a significant saving to the Exchequer in carbon credit purchases avoided.

Forests also play a role in reducing Ireland's carbon emissions from the combustion of fossil fuels. The increased use of indigenous wood fuel also offers significant opportunities to reduce Ireland's dependence on imported fossil fuels and contribute to national fuel security. I am mentioning these aspects to illustrate that the Government is very much aware of the economic contribution that forestry makes to our community, both directly and indirectly. The implications of any proposed transaction, whether immediate or in the long term, are being thoroughly considered in that overall context.

The Government is also highly aware of the concerns expressed about possible implications for recreational access to State forests. Given the current emphasis on pursuing a healthy lifestyle and the importance of exercise, it is encouraging to note that significant numbers of the population avail of these facilities and are prepared to bring their concerns to our attention. I reiterate that it is the harvesting rights alone which are being considered for sale and that work has been undertaken to identify potential forests for such a transaction. The level of recreational use is one consideration that must be integral to that selection process. It is the Government's firm intention that appropriate provisions be included in any sale of Coillte harvesting rights to allow for the maintenance of the company's current open forest policy. I underscore that this will be maintained.

In conclusion, I welcome this debate as it gives the Government an opportunity to outline the basis for the decision to consider selling the harvesting rights of Coillte, to give an update on the status of that consideration and to reassure the House and the general public that the Government is fully aware of the concerns and all the issues surrounding such a proposed transaction. I reiterate that the Government will proceed with great caution in respect of this matter and any final decision will take full account of all of the legitimate concerns expressed by the Deputies opposite.

Deputy Emmet Stagg

I thank the Minister for sharing time. I am encouraged by the direction of his remarks. As he has said, the Government is examining the viability of selling the harvesting rights of Coillte forests for an 80-year period. Today at a briefing session organised by IMPACT, we heard strong evidence from the timber industry, representatives of the 18 million visitors to Coillte forests last year and the eminent economist Peter Bacon. It was made starkly clear that the proposal would cost the State money rather than save it. I know that was referred to by the Minister in his amendment. It was also made clear that there is a massive social dividend from the availability of the woodlands and hillside walks to the public. There is a genuine fear that this social dividend would be greatly reduced if the sale of harvesting rights to the private sector for 80 years was to go ahead.

I welcome the undertaking in the Government's amendment to the motion before us to consult further with stakeholders and to take account of the Bacon report on the proposal. I ask the Minister to re-examine the viability of the proposal and whether it is necessary or desirable. I further ask that when this matter is reviewed, both the economic and the social consequences be taken into account. Finally, I take this opportunity to compliment Coillte on making this great amenity available to a large number of citizens and presenting it in a safe and unspoiled condition. In my own area, Donadea Castle estate, which is in Coillte ownership, is a case in point. Great numbers of people from the adjoining conurbation go there on a regular basis to use the amenity. It would be a great pity to see that lessened in any way.

An Leas-Cheann Comhairle

I call Deputy Doyle. I understand he is sharing time with Deputy Creed.

Deputy Andrew Doyle

I will take six minutes.

An Leas-Cheann Comhairle

Deputy Doyle will take six minutes and Deputy Creed four. Is that agreed? Agreed.

Deputy Andrew Doyle

I also welcome the debate. It is necessary for us to conduct a series of debates and thrash out this proposal and the possible benefit or otherwise. I will provide some background information. In April 2011, the McCarthy report made the point that Coillte reported aggregate pre-tax profits of €204 million in 2009, with profits from land sales accounting for 70% of this amount and profits from sales from immature forests accounting for a further 17%. Profit from forestry and downstream operations including log sales and CPP, which were traditionally the core operations, accounted for just 13% of the company's profits.

Deputies on the opposite side of the House have acknowledged that Coillte is not a perfect model and certainly needs to be looked at. The reason we are looking at it is that, under the deal with the troika, we have undertaken to examine the possibility of selling €3 billion worth of State assets. While this is regrettable and is because of the economic position we are in, it is an opportunity to examine all State assets, run the rule over them and see if there is value in the sale of some of them - in Coillte's case, the harvesting rights. However, we should bear a few things in mind. A total of 47% of the forest estate in the country is privately owned, although it is not as mature and is not in a cycle of maturity.

All new afforestation is being done by the private sector. Carbon sequestration has been mentioned. Only new plantations since 1990 can be considered under the current agreement and under Towards 2020. We must reduce our greenhouse gas emissions. In the last Dáil I was rapporteur for the climate change committee which reported on how to calculate the value of forestry in land use. Heavy machinery is a necessary tool for working in forestry. Coillte has the right to move or alter the Wicklow Way - but not to close it - during harvesting.

I refer to three existing reports. The Coillte report has been forwarded to the steering group which will make a report in conjunction with NewERA and present options to the Government by the end of next month with further consideration and no determination until the end of quarter two or early in quarter three. EPS Consultants carried out a survey on behalf of the sawmills processors. Mr. Bacon has also made a report. There are seven points common to the reports. The seven core issues include the impact on timber processing and the timber processing sector; the viability of the remaining entity; the impact on employment, including the Coillte pension fund; the Coillte debt and bank loans; the replanting obligations; recreation and the public good; smart-ply investment. Coillte has three core activities which are the forest estate; smart-ply board mill industry and product development in conjunction with the private sector processors; windmills and renewable energy. Coillte continues to have a public service obligation which it argues is not the most economic or efficient method of supplying wood chip to the peat-burning stations for co-firing.

I am the Chairman of the Joint Committee on Agriculture, Food and the Marine. The chief executive of Coillte and also the chairman have attended the committee last October and November. We intend to invite all the statutory bodies to attend the committee as well as the processors, the nurseries, the forestry management companies, the recreational users and the trade unions. It is hoped these hearings will provide an informed consideration for the Government. I urge the Government to take time to consider all the deliberations of the committee on this matter. The committees have proven to be productive fora. I welcome the fact that this debate is being conducted in a mature fashion and that all speakers are allowed to make their points. The points raised in the original motion are valid for consideration.

Deputy Michael Creed

I welcome the opportunity to contribute to the debate and I thank Deputy Doyle for sharing his time. I do not have any ideological hang-ups about selling Coillte's trees. They are sold annually as it stands. I welcome the Minister's reassurance in this regard but I understand that the issue is whether we decide to forward-sell them. We are not selling the ground on which they grow nor the air above them. It is a case of whether this makes economic sense, given a whole series of legitimate concerns which have been raised. Sometimes the tenor of the debate becomes too emotional and, if I may be pardoned the pun, it becomes difficult to see the wood for the trees. This is not the death-knell of rural Ireland; this is about whether it makes sense to forward-sell and use the proceeds - as enabled by virtue of renegotiating with the troika - to stimulate employment creation opportunities in our economy. Anyone would welcome this proposition, provided it makes economic sense. I acknowledge the legitimate concerns, however, the Armageddon which is being forecast is well wide of the mark.

I am always somewhat sceptical of consultants' reports because, to a degree, one gets what one has paid for. We have had Bacon reports - with all due respect to Mr. Bacon - in this House before. We might have been well advised if they had not been taken as seriously as they had been at the time and we may have avoided much of the trouble we are experiencing today. Sin sceál eile.

I come from a constituency which has two significant players in the sawmilling business, Palfab and Grainger sawmills, who give very valued local employment. Coillte and the private forestry sector both have significant presences in the marginal land in my constituency.

I refer to the issues of legitimate concern, one of which is that any future arrangement would not impede the annual flow of timber to sawmills because this would be a significant concern as it relates to the downstream employment opportunities. The Minister has clearly indicated that there is no point in the State getting a ball of cash with the consequences being that the cash would be absorbed in dealing with job losses and unemployment payments. It must make sense under all the other headings. These are not all economic issues because there are also social, recreational, environmental issues and issues of access, which are important also.

The Coillte public park in Gougane Barra in my constituency is widely recognised as one of the great recreational forestry areas. Many of these forestry estates do not have a commercial crop and buyers will not be interested in bidding for them. The quality of the wood is not as good. Some will say that a minority of Coillte's forestry holdings have timber of significant commercial value. The proposal must be evaluated against a whole series of objective criteria such as the replanting obligation which is critical; the flow of timber to sawmills; the recreational open access issues.

I wish to take this opportunity to pay tribute to our former colleague, Shane McEntee, who was a Minister of State. I did not have the opportunity previously. He was not a man of many words in this Chamber but by his deeds shall we judge him. In very difficult times it is a tribute to him and to the Government that the level of funding available for afforestation was maintained.

We need to make haste slowly with regard to afforestation. Serious deliberation about the process is being undertaken. All the stakeholders will be consulted, including employees. I bring to the attention of the Minister a small cohort of former Coillte employees who have been disgracefully short-changed by the company's pension policy. I am aware of someone who spent more than 30 years working with Coillte, who has a pension of less than one euro for every year he worked. That issue needs to be addressed because it is a festering sore on Coillte's corporate image. Coillte had very highly paid executives and also people who gave blood, sweat and tears to build the company to what it is today but who are in receipt of disgracefully small pensions. That needs to be investigated and those issues need to be addressed in advance of a sale.

I refer to the private forestry sector. Deputy Moynihan will be very familiar with the Mullaghareirks.

In that context, there is an inter-agency impasse involving the National Parks and Wildlife Service and the Forest Service with regard to the hen harrier. If one mentions the hen harrier in some parts of my constituency, certain individuals become very angry. There is a need to remove the artificial impediments that exist in order that people might get on with the job. I am not in favour of any diminution of our obligations in respect of biodiversity, etc., but a balance must be struck. I am of the view that such a balance does not exist at present.

Deputy Michael Moynihan

I welcome the opportunity to contribute to the debate. There are many issues which arise, including those which relate to Coillte and the sale of the trees for which it is responsible. Making flippant comments is not the way to proceed. For a raft of reasons, we have major reservations with regard to how it is proposed to proceed in respect of this matter. The Government and the Minister will state that we grow the trees for sale. We could retort by stating that farmers who raise suckler cows wait until their calves have matured before selling them in order that they might maximise their profits.

The serious issue which arises is whether the sale of Coillte's forests represents a sound economic investment, either now or into the future. In the 1960s, the then Government and the Forestry Service - as it was known at that time - were involved in a major initiative to increase the level of afforestation throughout the country. This was because that level was extremely low. Those involved sought to purchase huge amounts of marginal land and they gave the farmers from whom they eventually purchased it the massive sum of £1 per acre. This is how the State built up the land bank it currently owns. The State benefited enormously from what was done in the 1960s because within five or ten years the land in question was worth huge multiples of the £1 per acre originally paid for it. We must ensure that we know what is going to happen with the land to which I refer.

Since the period 1989 to 1990, the level of private afforestation has increased dramatically. If somebody were to have offered to pay those farmers who became involved in afforestation in 1989 and 1990 a specific amount in respect of their trees when they had matured 20 years later, they would have made an absolute mint. The prospective return on timber at that stage does not even bear relation to the amounts for which they are currently selling thinnings as opposed to mature trees. Based on the evidence of what has happened since decisions taken 24 and almost 40 years ago, there is no way the State can be completely certain that it will get the best bang for its buck in the context of attempting to estimate what it should charge up front for a crop that will be maturing in 50, 60, 70 or 80 years time.

Many issues arise with regard to the replanting of forests and the obligations relating to the lands involved. In the context of what was done in the country's best interests in the 1960s, when land was bought for £1 per acre, and at the end of the 1990s, when farmers planted forests in respect of which they are now obtaining between €15,000 or €16,000 for just the thinnings from each 20-acre crop, the profits that have since accrued could not have been envisaged when the original decisions were taken. Regardless of the number of consultants' reports obtained or of how much the relevant officials go through the books, I am of the view that the Government cannot be absolutely sure that whomever purchases the exclusive rights to the trees on Coillte and other State lands will not reap huge benefits in the future.

There are many matters to which consideration must be given. We must examine the position of the industry at present. We must also consider the position with regard to Coillte lands and public access thereto. Coillte has developed many great walks, amenities, cycleways and recreational areas for the public in its forests. People in rural communities make extensive use of many of these. I was recently contacted by a person who is fortunate enough to own arable land adjacent to one of the walks to which I refer and who sells the products from their dairy farm directly to those who use the walk. This is an example of the benefits which can accrue from the forest walks which Coillte and the State have done a fantastic job in developing over the years.

I take the point made by constituency colleague, Deputy Creed, in respect of Gougane Barra and the forest there. If one walks through that forest, one could not foresee the sawmill companies or those who are going to invest arriving at a huge rate. There are many trees on Coillte lands throughout the country which might not be as mature or as saleable as people might believe when they look at a map detailing the thousands of hectares of such lands. In the context of the sale State assets, it should not be the case that Coillte lands should be sold because they are going to be sold in any event As already stated, that is not an economic argument. In the context of the amounts which the Government has publicised as being attainable, I wonder whether the position has been the subject of serious consideration. If the real costs were taken into account, I am of the view that the amounts eventually obtained will fall far short of the original estimates. This means that those who may purchase Coillte's forests will ultimately make a mint and that the State will be short-changed to a massive degree.

Two issues have arisen in respect of special areas of conservation in the past, namely, those relating to the hen harrier and to the development of wind energy. The relevant EU directive relating to hen harriers, which emerged in 2004, made provision to the effect that an entire region should be designated for these birds and should be closed down completely. The experience to date has been that the planting of trees on particular lands has no impact on hen harriers. Indeed, such plantings create conditions which encourage hen harriers to breed and increase their numbers. The language used by the European Commission and those opposite who occupied the benches on this side of the House in 2004 and 2005 left a great deal to be desired, particularly as the reality was far different to the level of concern that was whipped up.

Coillte is considering developing wind farms on some of its lands and such farms have been developed adjacent to those lands. Everyone is aware of the benefits and profits which can accrue from such developments.

The motion questions whether we should proceed with the proposed sale of the trees on Coillte lands. Previous speakers raised a raft of issues including those relating to Coillte staff and their pensions. I have already referred to what were the perceived benefits when certain decisions were taken 24 or almost 50 years ago and the fact that the actual profits realised have surpassed all expectations by many multiples. If one strips the motion down to brass tacks, then one fact emerges, namely, that 11% of the State's land bank is under Coillte trees. The Government is faced with a decision as to whether it is going to sell the harvesting rights to those trees as part of the deal with the troika. The approach which appears to be under consideration in this regard is that the trees in question would have been sold at some point in the future so why not sell them now. I am of the view that this is the wrong thing to do.

Twenty or 30 years from now we will be examining the issue of whether Coillte was sold this year, 2014, 2015 or whenever the decisions are made.

In this time of recession, rather than multiplying upwards as we did ten years ago, we are multiplying downwards to ensure we get a realistic figure, but whoever comes in here, whether it is banks or other international companies, they will only come in if they see that there is a killing to be made, so to speak. However, it would be wrong to allow others to make a killing when the State needs to make a killing because in the 1960s landowners were paid £1 an acre by the then Department of Agriculture, or the Forestry Commission as it was at the time. The State bought back that land subsequently. Also, in terms of side benefits, we had a presentation on that in the audio-visual room, but Deputy Andrew Doyle alluded earlier to the downside of it, and we have seen the benefits of the State owning something. When the State owns something, it can take a strategic view, and rather than taking commercial view at the time, it took a long-term view, from which it has benefited enormously.

Like my constituency colleague, Deputy Creed, I would urge caution in respect of some consultants' reports because they are not all what they seem. We must stand back in terms of our view of this issue but we must ensure the Government or the Dáil proceeds in the right way on it. Figures such as €600 million or €700 million have been bandied about but even if the figure was a multiple of that, and we are looking 50 or 60 years into the future, there is still a greater benefit in the State holding on to the Coillte crop. I understand the Coillte lands will not be for sale but in some instances the Coillte lands have been sold. In some instances when people have come together to try to buy Coillte land for one reason or another, that has been a protracted issue.

On a side issue, there is a debate ongoing at another level in the Department of Agriculture, Food and the Marine and the European Commission about commonages on some Coillte land and their eligibility for single farm payment purposes and so forth, but a document was released recently which indicated they would have to have an action plan on all the commonages. One farmer told me that the last bomb scare in the South of Ireland about 20 or 25 years ago was in part of my constituency when a meeting was due to be held between the supposed owners of the commonages and the Department to agree a way forward.

I have been negotiating with a landowner for the past two and a half years in regard to deeds for their own land. Coillte might examine all its land titles, searches and so forth because it might not have full title over some lands it is claiming as its own. I am aware there are issues in that regard because in one case a father who was transferring land to his daughter faced a difficulty in that some of the land was being claimed by Coillte going back 40 years or so. A rigmarole had to be gone through to ensure the proper transfer went ahead, and the State benefits from that were held up until that process was properly concluded.

The Government should make haste slowly because this is the wrong thing to do. The timber from the Coillte land is and will be far more valuable. Under the MacSharry proposals in 1992 huge premiums for afforestation came on stream but many people who planted in 1989, 1990 and 1991 were given projected figures for the first thinning and for the mature crop. The figures they were given at that time are only fractions of what they are now realising from first thinning. That is far more valuable than what is being proposed.

Deputy Martin Ferris

I welcome this motion as it is a timely opportunity to highlight a potentially disastrous decision to go ahead with the sale of harvesting rights in State-owned forests. This is an issue that has caught the public attention and the highlighting by people like the Woodland League, Deputies, myself and others in recent years of the likely move on Coillte has had the positive effect of holding it up.

When news of a possible selling off of the forestry rights or even the land was first brought to attention, I referred to the interest that had been expressed by a company involving the former Taoiseach, Bertie Ahern. It would be interesting to know whether that company, the Irish Forestry Fund, and its Swiss partner, Helvetia Wealth, are still in the running to acquire harvesting rights if and when the Government acts on the McCarthy recommendation to privatise public forestry assets.

Interest has also been expressed by the Chinese state overseas investment corporation, and I have it on very good authority that this issue was discussed during the visit of the high level Chinese diplomatic and financial delegation last year. It would be the ultimate irony if this Government was to sell off Irish state assets to another state.

It is also the case that when the possible sale of Coillte assets became an election issue in February 2011, both Fine Gael and Labour moved quickly to assure voters that they would never agree to any such sale. The now Minister of State, Deputy Sean Sherlock, rightly asked at the time: "Do we really want to end up in a situation where this for-profit company could turn around and do whatever it feels like with a natural resource that rightly belongs to the Irish people, including many of our forests, rivers and lakes?" If the Minister of State still feels that way, he knows what he should do here tomorrow night.

The same applies to Deputy Andrew Doyle who during that election stated:

Our vital national resources are not up for sale. National resources, like forestry, agriculture and marine, are held in trust for all the people of Ireland. Ministers are stewards of these resources and must return them to the people with benefits after their term in office. That includes the forests of Ireland.

I concur with what Deputy Doyle said at that time.

As the Bacon report concluded, the sale of forestry harvesting rights would "in effect bring an end to Coillte as a commercial entity". Not only would such a sale be financially bad, entailing a loss of €1.3 billion, it would also hardly make sense to have Coillte remain in existence if the objective is to realise value from such a sale. The clear implication is that a sale of harvesting rights is in effect the first step in full privatisation. It also has massive implications for other uses of the 7% of the State's land that is under Coillte stewardship. What, for example, will happen to any mineral deposits under Coillte land? A geological survey was conducted some years ago, but Coillte is very coy about what it revealed. When I raised that issue in a committee meeting before Christmas, I was told by Coillte that it has a ballpark notion of where potentially valuable mineral deposits are to be found. I wonder if some of the potential privateers also have a similar ballpark notion and if that is one of the motives for wanting to gain access to Coillte lands. I have no doubt that certain people know more about those potential deposits than the rest of us. During several debates we had on this issue, one of the aspects mentioned was that the more valuable assets of harvesting would be easily purchased and sold, but there was an acceptance that part of Coillte forestries would not realise any potential value and therefore would be left in Coillte hands.

I welcome this motion and hope that all of those who have expressed concern about the proposed sale and who have in the past gone on the record in opposition to such a sale will act in accordance with their opinion and support this motion and, more importantly, strongly oppose within Government any move towards stripping Coillte of its core assets. I trust that the Deputies I mentioned will live up to what they said prior to the election.

Debate adjourned.

The Dáil adjourned at 9 p.m. until 10.30 a.m. on Wednesday, 27 February 2013.