A response to Great Southern

There was disturbing unreality about Great Southern’s Mr Ikin reply (Your Say January 30^th) to my letter on land tax in general and GSL’s Temma property in particular.

Mr Ikin is still reading from an old copy of GSL’s psalm book.

GSL reported on their website in October 2008 that “extensive areas of this plantation have failed and the majority of the failed areas are yet to be replanted……..approximately 36 hectares of this area will not be replanted.”

This differs from Mr Ikin’s assertion that only 14 hectares failed and it has all been replanted.

GSL has also allowed its cattle to graze the property inflicting great damage to the seedlings already battling to survive adverse conditions.

Forestry Tasmania's delusions

Ill informed claims and counter claims are by no means endangered species in the forestry debate. The interpretation of finance and economic statistics is often a cause for concern, even alarm. Usually one can safely turn a blind eye to the PR boys when they venture into areas of ‘benefits of Project A’ or ‘economic value of Industry B’. But when the executives involved in some of the decisions enter the public arena with similar fatuous claims, it is little wonder how confusing it is to interested observers.

Dr Hans Drielsma, the Executive GM of Forestry Tasmania (FT) in a letter published in the Mercury on 22nd January 2009 under the heading ‘True economic value’ attempted to argue that the true economic value of the State’s forestry industry can be measured by reference to its annual turnover.

Rates land tax and plantations

Do MIS companies pay their fair share of municipal rates?

The answer in short, is they are given special treatment which allows them to pay lower rates than other farmers. But it is in the matter of land tax where the State Government has been seriously remiss. Many of the failed and failing MIS schemes are arguably not entitled to land tax exemption which has always been granted in the past.

Special treatment for plantations

One of your correspondents in a note titled “Does Gunns pay rates” again raised the question whether plantation growers pay their fair share of municipal rates.

The answer in short, is they are accorded special treatment with respect to their assessed level of rates. But it is in the matter of land tax where the State Government has been seriously remiss. Many of the failed and failing MIS schemes are arguably not entitled to land tax exemption which has always been granted in the past.

Great Southern heads further South

Great Southern (GSL)continues its search for cash to enable it to survive 2009 after a tumultuous decline in its fortunes during 2008.The Plan to purchase 6 tree projects and 2 cattle projects from investors in exchange for GSL shares was aborted in Dec 2008 when the value of GSL shares fell as low as 12.5 cents. GSL will try again to get approval from investors and shareholders in the last week of Jan 2009. The shares are currently trading at 17.5 cents, not much improvement.

This time the Independent Directors had no alternative but to recommend against the Plan in respect of the 1998 Project which is currently being harvested. 1998 investors can wait a few months to receive $2,300 cash or accept GSL’s offer of 4,606 GSL shares currently worth $800. No need for a calculator.

Race to the bottom

The MIS companies are continuing their inexorable journeys towards a catastrophe. Not all will survive intact.

Great Southern Plantations (GSL) seems to be at the head of the peloton at this stage.

Desperately trying to find some cash to pay the bills over the next few years GSL has been trying to persuade Woodlot investors to swap their trees for GSL shares so that when the trees are harvested GSL will get to keep 100% of the net harvest proceeds instead of giving 94.5% back to the Woodlot owners.

Collapse of MIS

LEONIE WOOD has written another revealing episode in The Age ( HERE ) concerning the collapse of Environinvest a MIS company which traded principally in Victoria. It’s interesting to read about the cast of characters involved in the real life drama.