Dáil debates

Thursday, 6 October 2011

5:00 pm

Photo of Willie O'DeaWillie O'Dea (Limerick City, Fianna Fail)
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Question 6: To ask the Minister for Agriculture; Fisheries and Food his views on the sale of Coillte's assets as part of NewERA; and if he will make a statement on the matter. [27950/11]

Photo of Simon CoveneySimon Coveney (Cork South Central, Fine Gael)
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Although Deputy O'Dea is not present, I will read the reply into the record. Coillte was one of 28 commercial state bodies reviewed by the review group on State assets and liabilities, chaired by Mr. Colm McCarthy, which reported in April 2011. There were three recommendations in the section dealing with Coillte, one of which was that the State should initiate the disposal of Coillte's forest and non-forest assets but not its forest land. My Department has considered the recommendations in the report and I also asked Deloitte on a pro bono basis to examine the recommendations in the McCarthy report as they apply to my Department, including Coillte. The analysis and possible outcomes from this work will be considered by the Government, along with the future of other assets, in the context of the work of NewERA.

Coillte was established as a private commercial company under the Forestry Act 1988 and currently manages some 442,000 ha of land, of which some 390,000 ha is under forestry. It also plays a significant role in the provision of forest recreational activities, which was evident from the participation in National Trails Day last weekend. Given its extensive forest holdings and its role as main supplier of timber to Irish sawmills, it is a key player in the Irish forestry business. The group's two panel processing companies, Smartply Europe Limited and Medite Europe Limited, also export significant volumes of wood panelling. The review report recommends the disposal of Coillte's forest and non-forest assets but not its forest land. However, there are still a number of considerations and options arising from that recommendation.

As I outlined to the House in an Adjournment debate on this issue in June, it is essential to maximise the information available to the Government to make an informed, sensible and well-thought out decision that will not compromise the State's core asset, which is the land Coillte manages on behalf of its shareholders, amounting to some 7% of our land mass. NewERA can play an important role in this process. To assist in its examination of options for the possible disposal of assets in general, the Government has requested the Department of Public Expenditure and Reform, in consultation with relevant line Departments, such as my own, and NewERA, to consider a number of possible candidates for disposal. The Government will be advised on the appropriate valuations to be placed on the assets in question, and on the most appropriate method of disposal, likely timeframe and economic impact of any such disposal to inform any further decisions that the Government may wish to make in this regard.

Photo of Michael MoynihanMichael Moynihan (Cork North West, Fianna Fail)
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Since the Forestry Act 1988 and before it there was a drive in some parts of the country to take on forestry. In my own part, over 50% of some parishes are under forestry. There is a significant concern about the issue and it is vital to make a distinction between the Minister's comments and the notion debated on the public airwaves and elsewhere that Coillte land is for sale. Whatever the recommendations from the various bodies reporting on the sale of assets, it is vital that the land be kept in State ownership. It was sold to Coillte for minimal prices 20 or 25 years ago and it was never envisaged that the land would go to outsiders. I caution against such action. The Minister should also take account of what such action would mean to peripheral regions in the country which have given, in some cases, more than 50% of the land to afforestation.

Photo of Thomas PringleThomas Pringle (Donegal South West, Independent)
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Will the Department consider that forestry is a national asset as well as the land? There will be a future need to develop a wood biomass industry within the country to offset oil consumption and usage. Will the Minister give this consideration in making a decision? I hope he will make the right decision and not dispose of the assets.

Photo of Mick WallaceMick Wallace (Wexford, Independent)
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We do not have to go into the argument of the merits or otherwise of selling a State asset. Some 18 million visitors use Coillte land every year and I imagine if it was sold for private purposes, there would be some serious insurance issues arising from the public using the land which is currently a magnificent facility for the people.

Photo of Simon CoveneySimon Coveney (Cork South Central, Fine Gael)
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I wish to be absolutely clear on a number of issues. No one is considering selling Coillte land and that is off the table. When I asked Deloitte to consider the matter, I stipulated that there should be no consideration of the sale of Coillte lands. I appeal to people to be responsible on the issue if and when we must discuss the matter at some stage in future.

It is true to say that the forests which Coillte manage are also valuable assets. One may argue about the valuation of a crop of 390,000 ha of woodland but the idea considered in the Deloitte report was that a crop, or asset, could be sold through harvesting rights for the next 20 or 50 years, depending on how much value we want. At the end of the process, the land would revert to the State, with a requirement in place for re-afforestation and replanting. Essentially, the asset of the forests and land would come back to the State at some time in future.

That is the kind of option we are considering but I stress that no decision has been made on the sale of Coillte as a company or in terms of forest assets. Any sale will take account of the issues raised by Deputy Wallace with regard to ensuring public access to recreational land and so on. There is a significant portion of Coillte land that is not accessed by anyone and we are considering all the options now, including valuations. We will make some decisions as a Government in the not too distant future.