Mr. Pat Glennon:

It is the first time we have ever been accused of pornography in the saw milling industry. We could be accused of a lot of things but I do not think that is one of them.

The range of topics raised is very wide but I will try distil my response into a few key points. This industry is not looking for a hand-out. We have come through one of the toughest recessions the world has ever seen and we are still here. Any industry that is still functioning despite the fact that its market has gone from 90,000 units to 8,000 units, its energy costs have increased by 70% in two years and its transport costs have increased by 35% in two years is an industry worth holding on to. In a country with over 400,000 people unemployed, I would encourage the Government to protect and grow this industry. I wish to make it clear that we are not looking for hand outs. Ours is a vibrant, tough industry that is able to compete. However, we do not want to go into the boxing ring with one hand tied behind our back.

There are 2,500 people employed in the industry at present. Page 5 of the report we prepared and circulated to committee members outlines the employment potential in the industry in the future. Every 15,000 hectares planted will generate another 490 jobs directly and every 100 jobs in a saw mill will generate another 70 full-time jobs in other sectors of the economy. A steady supply of raw material from Irish forests could generate another 7,000 jobs by 2025. All of those jobs would be in rural areas, as Deputy Ó Cuív pointed out. On average, the typical haulier would live within a 50 km to 60 km radius of the saw mill being supplied, although that can change depending on where the logs come up for sale.

There is quite a good recreational link between Coillte and walking groups, including Mountaineering Ireland and others. Rights of way are provided. If some of the saw mills happen to be harvesting on a given site, walkers can still access that site at weekends. The rights of way are kept open, albeit on a more limited basis.

We are talking here about a green product. Wood is the building material of the future, from a green perspective. Forestry is a totally sustainable industry where trees can be grown, felled and replanted. Going forward, with all of the new carbon-reduction demands for new houses, wood is the preferred product. In terms of climate change and carbon sequestration, there is no other product on this planet that actually absorbs carbon dioxide, stores it when it is cut and continues to store it when it is used for a building.

We can use it again when we want to take down the building. It is a totally green and sustainable product and we must capitalise on our natural advantage of being able to grow the product twice as fast as our competitors in Europe.

In describing the current relationship between us and Coillte, I could say that it is not perfect and we are not perfect. There is no question that it is a very tough relationship, and the issue of the 29% premium is due to the wrong forecasts being made in the industry ten or 12 years ago. Forecasts were given that "a wall" of wood was coming down the tracks and that the industry needed to gear up to process it. The indication was that if we did not do it, those in the industry would do it themselves. The industry subsequently invested €200 million around the country but the forecasts never came to fruition as the volume was and still is not there. That is the reason we are paying 29% more for logs today than we have done heretofore. It is down to over-capacity, as there is more sawmill capacity on the island of Ireland than there are logs available. Our sawmill, for example, imports 20% of raw material from Scotland just to keep the mill going. I am trying to emphasise that the balance is critical. If 500,000 cu. m. is moved from this island and we still take 1 million cu. m, it would close one large and two medium sawmills. The balance is that tight.

Perhaps Mr. McNamara will comment on the smartply and pulp issue.