Sale of Coillte (?)

brian_m

Pete_Cavan wrote: »

There is a difference between commercial and recreation forest. Commercial forests are not much good for adventure tourism (because the forest is going to be cleared when the trees reach maturity) and visa versa. They will be different in terms of type of tree planted, how they are planted, forest infrastructure present, etc. so are not easily converted.

The Management Objective section of the relevant Forest Management Plans 2011-2015 breaks down the purpose of the various areas of Coillte each forest. It gives the percentage area for timber production, biodiversity, recreatation, etc. Harvesting rights will only be sold for the areas for timber production because other areas will be of little commercial value anyway. The only lost opportunities for commercial forest areas will be if we continue to let them be harvested by an inefficient state company instead of selling the harvesting rights to unlock its full economic value.

The Coilte built MTB trail networks that are currently in place are built within commercial forests from what I can see...?

Pete_Cavan

brian_m wrote: »

The Coilte built MTB trail networks that are currently in place are built within commercial forests from what I can see...?

Most likely recreational areas of forests which also contains commercial areas. I was looking for the FMP for Ballinastoe where there is a MBT but I dont know what Coillte call that forest because Ballinastoe is not listed on the website.

Grudaire

brian_m wrote: »

It sounds like Coilte are doing a poor job on making a decent ROI and if the land was managed better it would be more profitable i.e like more exploitation of adventure tourism. Selling off the harvesting rights may be more profitable compared to the current ROI numbers but to me it sounds like a quick fix solution which could have far higher long term costs especially in terms of lost opportunities... With Bertie Ahern involved I have serious reservations

Perhaps Coillte has been focused on Increasing forestry rather than increasing profits

"Between 1989 and 2007 Coillte has:
Increased its Forest estate from 376,000ha to 445,421 ha. (445,315 ha are forested)."
http://en.wikipedia.org/wiki/Coillte

You can't look at Profits or ROI alone when considering performance. It's unfair and completely inaccurate to quote a single performance measure alone

SupaNova2

Pete_Cavan wrote: »

I dont really see the issue here. The state owns commercial forestry land and, given that the operations are controlled and administered by state employees, I am sure there is better value to be had for the taxpayer by selling harvesting rights to private companies under competitive tendering for a limited period of time. State involvement is reduced (which reduces cost to the taxpayer), rights sold to the highest bidder (maximising income) and the state still owns the asset at the end of it all.

This is actually much worse than selling it into private hands completely. Incentives are twisted so that the company rapes as much as possible under said period as they might just lose rights come the next round of bidding. Where as if forests were sold off completely, and for a much higher price obv, the same approach would not be taken as nobody wants to devalue the price of their own assets.

Grudaire

Pete_Cavan wrote: »

I dont really see the issue here. The state owns commercial forestry land and, given that the operations are controlled and administered by state employees, I am sure there is better value to be had for the taxpayer by selling harvesting rights to private companies under competitive tendering for a limited period of time. State involvement is reduced (which reduces cost to the taxpayer), rights sold to the highest bidder (maximising income) and the state still owns the asset at the end of it all.

Value

Value is a hightly subjective term to use. I hope you wouldn't have a bankers attitude to the word 'value'?

brian_m

Pete_Cavan wrote: »

Most likely recreational areas of forests which also contains commercial areas. I was looking for the FMP for Ballinastoe where there is a MBT but I dont know what Coillte call that forest because Ballinastoe is not listed on the website.

I think recreational facilities can be easily tied in to commercial areas is my point, maybe more care taken during harvesting time?

Pete_Cavan

Cliste wrote: »

Perhaps Coillte has been focused on Increasing forestry rather than increasing profits

"Between 1989 and 2007 Coillte has:
Increased its Forest estate from 376,000ha to 445,421 ha. (445,315 ha are forested)."
http://en.wikipedia.org/wiki/Coillte

You can't look at Profits or ROI alone when considering performance. It's unfair and completely inaccurate to quote a single performance measure alone

We are talking about commercial forest areas here, as distinct from forests for recreational or biodiversity reasons. These commercial forests were planted for one main reason, to provide a financial return to the state. The state owes it to the taxpayers to pursue this profit with these assets, after all it was taxpayers money invested in them. Planting of forests for non-commercial reasons can continue irrespective of the ownership of harvesting rights for commercial forests.

SupaNova2 wrote: »

This is actually much worse than selling it into private hands completely. Incentives are twisted so that the company rapes as much as possible under said period as they might just lose rights come the next round of bidding. Where as if forests were sold off completely, and for a much higher price obv, the same approach would not be taken as nobody wants to devalue the price of their own assets.

"Rape as much as possible"? We are talking about growing trees for timber production! Selling harvesting rights for 80 years has been talked about, this would mean two plant/harvest cycles. Apart from adequately maintaining and thinning the plantation and hoping for good weather, there is not much else you can do, unless you can control nature.

As for the next set of rights once the first period ends, the company can be contracted to undertake replanting before their contract ends, Coillte can undertake the work themselves, procure a different contractor to do it or make it part of the next harvesting rights contract. The trees they use can be required to meet a certain specification or taken from Coillte nurseries. These things are tied up in the contract.

SupaNova2

Pete_Cavan wrote: »

"Rape as much as possible"? We are talking about growing trees for timber production! Selling harvesting rights for 80 years has been talked about, this would mean two plant/harvest cycles. Apart from adequately maintaining and thinning the plantation and hoping for good weather, there is not much else you can do, unless you can control nature.

Ok, my point is nil if 80 years is what it goes for.

Grudaire

Pete_Cavan wrote: »

We are talking about commercial forest areas here, as distinct from forests for recreational or biodiversity reasons. These commercial forests were planted for one main reason, to provide a financial return to the state. The state owes it to the taxpayers to pursue this profit with these assets, after all it was taxpayers money invested in them. Planting of forests for non-commercial reasons can continue irrespective of the ownership of harvesting rights for commercial forests.

Can companies not grow then?

it would be nice if you could accept my valid point, can we look at the companies profit in the context of what occurred over the same time period?


It's owned by the Government, so won't manage the emergence of profits in the way other companies will.

recedite

Pete_Cavan wrote: »

Access to lands owned by Coillte will not be an issue because the land will still be owned by Coillte.

Technically, the land is owned by the State, not Coillte. They are just the management company. The government will decide the terms of any contracts to any new management companies. This is why one lot, the International Forestry Fund, thought Bertie would come in handy as their negotiator.

Pete_Cavan wrote: »

Most likely recreational areas of forests which also contains commercial areas. I was looking for the FMP for Ballinastoe where there is a MBT but I dont know what Coillte call that forest because Ballinastoe is not listed on the website.

Its under the general area of "Roundwood".
When Coillte built the MTB trail they hoped that all the MTB people would move off the other unofficial trails that the bikers had built themselves. After the official trail was completed they introduced byelaws banning bikes and horseriders from most of the other forests. The plan backfired because the official trail made mountain biking more popular than ever. IMO it's a healthy outdoor pursuit that should be encouraged where possible.
Most of the recreational areas are also commercial forest. There are only a few places, like around the lakes in Glendalough, where the trees are left standing long after their harvesting age.
Even broadleaf forest which has the highest recreational and wildlife value can be harvested in stages, while still retaining its amenity value.

Orion

From this month's Kildare Labour News:

Sale of Coillte Harvesting Rights Now Most Unlikely - Donadea Forest Park Secure
Following the Dail Debate on the proposed sale of the harvesting rights of Coillte Forests, and particular given the qualified nature of Minister Howlin's speech, Deputy Emmet Stagg said that he was now satisfied that it was not possible for the many strictures and conditions referred to by the Minister to be met and that it was now most unlikely that the proposed sale would go ahead.
Deputy Stagg complimented Impact Trade Union for the effective campaign they had mounted against the proposal and for bringing together in the campaign all the stakeholders and interested parties.
In addition to protecting the State's interest in our forests, Deputy Stagg stated that he was confident of the future of Donadea Forest Park and its amenity value to the people of Co. Kildare and the Greater Dublin Area, given that it was now most unlikely that the proposed sale would go ahead.

AlmightyCushion

"Deputy Stagg stated that he was confident of the future of Donadea Forest Park and its amenity value to the people of Co. Kildare and the Greater Dublin Area, given that it was now most unlikely that the proposed sale would go ahead."

There was no risk to the future of the park in the first place.

Pete_Cavan

AlmightyCushion wrote: »

There was no risk to the future of the park in the first place.

Yes. According to the Forest Management Plan for Donadea Forest Park, 95.3% of its area is for biodiversity purposes with the remaining area as non-forest commercial and recreation. It is not a commercial forest, would be of little or no commercial value and is more valuable retained in its present condition so there would be no point in selling harvesting rights. There are many other non-commercial forests which will be retained, however harvesting rights for the commercial forests should be sold.

Cookie_Monster

Cliste wrote: »

Perhaps Coillte has been focused on Increasing forestry rather than increasing profits

"Between 1989 and 2007 Coillte has:
Increased its Forest estate from 376,000ha to 445,421 ha. (445,315 ha are forested)."
http://en.wikipedia.org/wiki/Coillte

You can't look at Profits or ROI alone when considering performance. It's unfair and completely inaccurate to quote a single performance measure alone

Agree.

I've had issues with Coillte in the past but to be perfectly honest they are about the only Quango / Semi State that actually seem to be doing a good job overall.
It's just a pity the state doesn't seem to recognise it all that highly, they should be given more land and money to continue to expand forestry for future use, both commercial and otherwise.

Pete_Cavan

Cookie_Monster wrote: »

Agree.

I've had issues with Coillte in the past but to be perfectly honest they are about the only Quango / Semi State that actually seem to be doing a good job overall.
It's just a pity the state doesn't seem to recognise it all that highly, they should be given more land and money to continue to expand forestry for future use, both commercial and otherwise.

Given more money? Coillte had retained earnings of over €32million in 2010 but declined to pay a dividend to the state! Instead of being given money, they should be giving more money back as per their commercial mandate. This is even more important when the state is introducing new taxes and cutting services to close the budget deficit.

I dont know where you are getting that they "seem to be doing a good job overall" from either. Operating costs eat up for 84% of turnover with no details of these given. Apparently the Directors are of the opinion that "such disclosure would be seriously prejudicial to the Group’s interests". I am not surprised they feel this way when you see the packages these guys get. Coillte's foreign business provides about half of its turnover, I would be very confident that Irish operations account for well over half of their costs. It would be interesting to see how much of these costs could be eliminated by removing harvesting operations.

So the only evidence we have to support the claim that Coillte are doing a good job is figures on the area planted. Planting new forests is not related to harvesting rights of existing forests and can continue, and even be intensified, if harvesting rights are sold. The evidence we have is that Coillte is just another inefficient state owned company with extremely well paid board members and a huge pension deficit. They refuse to give out information on operating costs and did not pay any dividends in their most profitable years (2007 & 2010) but yet could afford to pay a €10m dividend in 2011, a much less profitable year, when they were coming under scrutiny. That says it all really.

Grudaire

Pete_Cavan wrote: »

Given more money? Coillte had retained earnings of over €32million in 2010 but declined to pay a dividend to the state! Instead of being given money, they should be giving more money back as per their commercial mandate. This is even more important when the state is introducing new taxes and cutting services to close the budget deficit.

The government has chosen to take no dividend from the company, your gripe there is with the government.

Although it could just be an indication that they are trying to fatten the company a bit before any sale of rights.

Pete_Cavan wrote: »

Operating costs eat up for 84% of turnover with no details of these given.

Again you're quoting out of context - what is the international average for this industry? Does it allow for the non-commercial aspects of Coillte?

For instance according to here Tesco's operating costs use up a whopping 94% - they must be doing terrible! *

Pete_Cavan wrote: »

I am not surprised they feel this way when you see the packages these guys get.

This is a completely separate argument to everything else.

But two quick points:

• The company has operating profits of several million. I don't think that is an excessive salary in comparison with private enterprises
• If you're sickened by the CEO getting paid that much, why doesn't it bother you that any company (eg Berties International Forestry Fund) will be making a multiple of that?

Pete_Cavan wrote: »

Coillte's foreign business provides about half of its turnover, I would be very confident that Irish operations account for well over half of their costs. It would be interesting to see how much of these costs could be eliminated by removing harvesting operations.

That just shows revenue...?

If you look at the rest of the report you can see that yes a lot of revenue comes from selling Panel Products abroad... but they're created in Ireland

Pete_Cavan wrote: »

So the only evidence we have to support the claim that Coillte are doing a good job is figures on the area planted. Planting new forests is not related to harvesting rights of existing forests and can continue, and even be intensified, if harvesting rights are sold. The evidence we have is that Coillte is just another inefficient state owned company with extremely well paid board members and a huge pension deficit. They refuse to give out information on operating costs and did not pay any dividends in their most profitable years (2007 & 2010) but yet could afford to pay a €10m dividend in 2011, a much less profitable year, when they were coming under scrutiny. That says it all really.

I don't see that your evidence backs that up at all..


* Note I accept this is a ridiculous comparison - but your argument here is equally ridiculous!

PS: Apologies for long post is long

Grudaire

Ah Bertie

https://www.youtube.com/watch?v=uh2CrBe8dJc

Colonialboy

Cliste wrote: »

* Note I accept this is a ridiculous comparison -

thats the only part in your post that was correct...

Grudaire

Looks like a decision will be taken quite soon on this, and luckily all the signs are looking negative for a sale of coillte/coillte rights.

In fact Pat Rabbitte recently told the Dáil that the “mooted privatisation of Coillte looks more unlikely every day”.


Article in the Times about it from Tuesday: http://www.irishtimes.com/news/environment/sale-of-coillte-tree-harvesting-rights-would-raise-a-few-grains-of-sand-in-a-desert-of-debt-committee-told-1.1393245

And the Indo earlier in the month: http://www.independent.ie/business/irish/timber-chief-fires-selloff-jobs-warning-29239242.html

Sweden tried it and then had to u-turn on their decision: http://www.irishtimes.com/news/environment/sweden-had-to-reverse-privatisation-of-state-forestry-expert-says-1.1396636

Anyway it doesn't seem like any lobby group is in favour of the damn idea except the Troika, and Bertie! :pac:

Iwasfrozen

We shouldn't be selling our forests we should be doing everything we can to grow them. Ireland used to be covered in trees it was humans who cut them down.

Orion

And it's over:

http://www.thejournal.ie/coillte-sale-scrapped-958348-Jun2013/
Cabinet abandons plan to sell off felling rights for public forests.

Good news. It was a crazy idea and with Bertie in the wings to buy it having been in a position where he could have read the mineral surveys it would have been disgraceful if he had had any part of the sale. This is good news for hikers, cyclists, runners, everyone.

goose2005

Orion wrote: »

And it's over:

http://www.thejournal.ie/coillte-sale-scrapped-958348-Jun2013/
Cabinet abandons plan to sell off felling rights for public forests.

Good news. It was a crazy idea and with Bertie in the wings to buy it having been in a position where he could have read the mineral surveys it would have been disgraceful if he had had any part of the sale. This is good news for hikers, cyclists, runners, everyone.

I wonder how much money was wasted on the whole process. A lot of consultants, strategists, tenders etc.

bgrizzley

Orion wrote: »

And it's over:

http://www.thejournal.ie/coillte-sale-scrapped-958348-Jun2013/
Cabinet abandons plan to sell off felling rights for public forests.

Good news. It was a crazy idea and with Bertie in the wings to buy it having been in a position where he could have read the mineral surveys it would have been disgraceful if he had had any part of the sale. This is good news for hikers, cyclists, runners, everyone.

Thank fcuk someone saw sense. Whoever came up with that should see the inside of a cell...

recedite

Bord Na Mona seem to run a tight ship, and a lot of the worked out Midlands bogs have been planted with forest anyway. The Coillte boys will have to pull up their socks now.

AlmightyCushion

Orion wrote: »

And it's over:

http://www.thejournal.ie/coillte-sale-scrapped-958348-Jun2013/
Cabinet abandons plan to sell off felling rights for public forests.

Good news. It was a crazy idea and with Bertie in the wings to buy it having been in a position where he could have read the mineral surveys it would have been disgraceful if he had had any part of the sale. This is good news for hikers, cyclists, runners, everyone.

Why would having access to mineral surveys matter? Whoever bought the harvesting rights wouldn't control the mineral rights as they would still belong to the state. Won't affect walkers or cyclists either as the land was never leaving state ownership.

Rovi

The economic, social, historic, recreational, etc, merits or demerits of this whole proposal became utterly irrelevant when it became known that Bertie Ahern was associated with a potential bidder.
His involvement rendered the whole thing utterly unpalatable to the general public and politically toxic. It was doomed from that moment on.

Orion

AlmightyCushion wrote: »

Why would having access to mineral surveys matter? Whoever bought the harvesting rights wouldn't control the mineral rights as they would still belong to the state. Won't affect walkers or cyclists either as the land was never leaving state ownership.

Are you certain of that? It was never made certain that only the felling rights were being sold - mineral rights could have been going to. As Rovi said Bertie being involved and having had access to the mineral rights surveys made it completely unpalatable to the Irish public.

As for access to the lands - you are wrong about it not affecting walkers or cyclists. Every single outdoor organisation in the country was opposed to the sale on the basis that a private company could and would restrict recreational access to the land in order to maximise their investment and plant/fell at will. So unless you know something they don't ... ? No commercial company would hand over any money if they were going to be forced to provide and maintain public access to forestry land.

Iwasfrozen

Rovi wrote: »

The economic, social, historic, recreational, etc, merits or demerits of this whole proposal became utterly irrelevant when it became known that Bertie Ahern was associated with a potential bidder.
His involvement rendered the whole thing utterly unpalatable to the general public and politically toxic. It was doomed from that moment on.

I couldn't care less about Bertie's involvement.