Steven Matthews (Wicklow, Green Party) | Oireachtas source

I join the Minister of State, Deputy Noonan, in acknowledging the massive investment secured by the Minister, Deputy McConalogue, and the Minister of State, Senator Hackett, in our forestry plan and thank them for it. Some of the facts and figures that have gone out on the investment opportunity with the Gresham House fund have been misleading. It is important to put it in context. The Government policy is to establish approximately 450,000 ha of land into forests by 2050. Coillte will manage approximately 100,000 ha of that. The investment we are talking about equates to approximately 3,500 ha of land and not the 50,000 ha that is being widely reported. That is a gross misrepresentation of the facts. The use of the term "vulture fund" is also misleading as there are no distress sales. Anyone can buy or sell land, anyone can plant trees and anyone can invest in this opportunity. We need to get those facts out.

However, the set-up of Coillte is something we wish to address and this gives us the opportunity. Perhaps it has highlighted the need to address the mandate of Coillte and establish a new mandate for the company which will deliver multiple benefits, including environmental and community objectives as well as the production of high-quality timber, and retain the commercial forests of Coillte in public ownership.

Coillte has a vision over the next 30 years to achieve a 50:50 split in developing forests for nature and for wood, which is a huge improvement on the current 80:20 split there is now. It should happen faster. One of the difficulties with Coillte is that, while it is a commercial entity, it does not retain the profits from its commercial ventures. I understand the profits go back to the State, making it a commercial State agency. It is prohibited from apply for Government grants because it would run foul of state aid rules.

On the remit of Coillte and how we can improve things, we are all in agreement that we have to plant more forests. Nobody would disagree with that nor would they disagree with the fact that the supports and incentives for farmers to do it go further and are a better grant than for somebody who invests but is not a farmer. We should be trying to encourage and work with the farming communities and landowners to plant more forestry. That said, if Coillte were allowed to maintain its return and reinvest its profits back into forestry in Ireland, we would likely need fewer outside investors. It is important to remember we will always need outside and private investment in much of what we do in this country. In housing, for example, there is an annual investment from the public purse of more than €4 billion, but the total per year is probably around €12 billion. That type of private investment is always needed.

This fund is seeking an investment of €200 million from a diversity of investors that could come from all over the world. It is not a quick buck or a quick return. I have heard people say this will inflate land prices and that investors will come in and make a quick killing. We are talking about investment in something that is not going to be harvested for 30 or 40 years. There will be grants over the duration the timber grows, but it will go back into managing it. The return on this is the timber produced at the end. I would like to see that timber being produced by Coillte commercially, but on public lands and that return going to the State.

We need a lot more timber in this country. We are talking about the construction of approximately 40,000 houses per year. The figure changes from time to time but we are looking at a figure of between 35,000 and 40,000 houses. If we build all those houses with concrete, and we covered this in the Committee on Housing, Local Government and Heritage recently, we will overshoot our carbon targets. Therefore, we must have much more timber frame construction and move to modern methods of construction. We have the raw material growing here. We know that soft wood, such as spruce, can be used to manufacture cross-laminated timber with which we can build much higher than the two- or three-storey buildings within the current regulations. All around the world, buildings are 12 to 14 storeys. That is what we need to be aiming for. That is what we need to be using the timber for. We must plant a lot more forests to do that.

We have failed, but this investment opportunity represents less than 1% of where we have to go with Government policy by 2050 to achieve the target of 450,000 ha of new forests. I would prefer if it were Irish investors and landowners, keeping it in the country but we have to rely on investment from time to time. It has been grossly misreported and I am glad to be able to put some facts on record.

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