Mr. Pat Collins:

I will address the matter of the contracts. At the start of the contracts, there was an upfront payment of €500 per hectare. This was an enticement to get people involved. People were not made aware, and the majority of people were not aware, that this had to be paid back. That payment is deducted from the clearfell profits, and those profits are index-linked. That is what the contracts stipulate. The majority of people to whom I spoke were not aware that this was taking place. It was not clearly outlined to them at the start. People thought it was wonderful to get €500 per hectare.

Senator Mulherin asked about the lien on the land. People did not know this was taking place. It has caused much distress to a lot of farmers, because they now feel that if they have to borrow money, they must get a letter of freedom from Coillte to allow that to happen. This has caused a lot of grievance. I do not know where this will end but there has been a lack of meaningful engagement on the contracts throughout.

There has been a lack of transparency. There was no indication of how Coillte would calculate the profits for purpose of the annuity. Nobody sat down and engaged with these farmers to tell them the quantum of their annuity payment and how it was determined. Much of the timber that has been thinned has been sold on by Coillte. There has been no documentation to show where it went. Dockets have not been issued. Farmers do not know whether the timber was sold as saw log pulp, stake or pallet wood,or where it went. As the committee is aware, one individual has said more than 4,000 tonnes of timber was taken from his land. That is an estimate. It could be much more.

There are a lot of issues here that need to be resolved. The contracts, as Senator Mulherin said, seem to favour Coillte. I would suggest that they do, but farmers signed up to them. They did not have the required knowledge. These people were the pioneers of forestry in rural Ireland. They were the first people to take this leap of faith and put most of their land in forestry. I deal with a farmer in Galway who has about 200 acres in a Coillte partnership. He is at a loss as to what is going on. There are people who just do not understand the concepts involved.

One woman indicated to me that her Coillte partnership is fine. I asked how long she has planted for. She told me she had planted for 18 years and was getting her money. The one good thing that has happened here is that the State has provided lucrative premiums for people to plant. That is good. However, this woman understood that this was coming from Coillte. She was not made aware of what the true arrangement was.

Coillte has misled people. There is a bigger issue here. People who get annuity payments have money dumped into their accounts. They do not know how the payments are calculated. It is a serious issue for a semi-State body to send out a statement, which is not even on a Coillte letterhead, of a sum dumped into their partners' accounts. That is a very misleading practice for a company the size of Coillte. It shows a lack of professionalism on its part. In one instance, the letter was addressed to the partner's wife, not to the partner himself. That is a serious breach. Coillte has to put up its hands and admit it was wrong that it never informed people of the amount of money due or how to calculate it. The company must admit it was wrong that its representatives never sat around a table with their partners, outlined their annuity payments and what Coillte made from the thinnings that it carried out.