Coillte sale ‘would pay 3 weeks’ interest on debt’

Selling the state forest industry would only generate enough cash to pay three weeks’ interest on the nation’s debts but could threaten 12,000 jobs, forestry workers have warned.

Ahead of a Cabinet discussion next week on any sale of Coillte, trade union Impact outlined losses which it said would fall on the State if forestry and timber production rights were sold.

The union, which represents 600 workers at Coillte, said selling the rights to sell timber to private operators would also jeopardise public access to forests and could close sawmills.

Union national secretary Matt Staunton said a report the union commissioned by Peter Bacon found the State would remain liable for €1.3bn in costs if harvesting rights were sold.

The Government is considering selling all or part of Coillte, as part of moves to sell off state assets to satisfy demand from lenders with the troika, as agreed under the bailout.

Mr Staunton told the Oireachtas committee on agriculture thousands of jobs were at stake.

The report concluded that extra costs from any sale would include €565m from loss of profit flow, €313m from a deficit caused by any sell-off, another €130m in pension liabilities, as well as €19m from job losses.

“We believe that the financial return on the proposed sale would only generate enough cash to pay three weeks’ interest on the nation’s debts. I describe this return as a few grains of sand in a desert of debt.”

Impact said an estimated return from the sale of harvesting rights would be €774m, half of which would go toward Ireland’s debts.

Mr Staunton admitted there was “a legislative vacuum” surrounding the operation of the state forestry sector and said workers were open to Oireachtas members examining any updated regulations for the industry.

Most TDs and senators at the committee meeting, including those from the Coalition, said they opposed the sale of state forestry assets.

Independent TD Richard Boyd Barrett said the sale of forest harvesting rights would be “economic and environmental vandalism”.

This may be done to pay off the debts of banks, he claimed, some who, in turn, may end up owning rights to Coillte down the line.

Labour senator Susan O’Keeffe said: “Most of us here are very concerned about selling our soul [the forests] for a halfpenny.” She said her party members were speaking to Labour ministers pushing for no sale of Coillte’s assets.

Agriculture Minister Simon Coveney has said he will bring a report to Cabinet by next Tuesday which will make recommendations on whether to privatise any parts of Coillte.