Economic and planning risks

Economic and planning risks have been updated in Pulp finance.

Tasmanian Roundtable for Sustainable Industries report

The Tasmanian Roundtable for Sustainable Industries report (August 2007) analyses both the costs and the benefits of the proposed pulp mill. To-date, Gunns’ Allan Consulting report and the Government’s ITS Global have been limited to only the possible benefits of the project.

The Roundtable report is a conservative analysis of both the costs and benefits of the proposed mill. Further, the model used to examine the profitability of the mill can be found at www.lec.org.au where the model can be downloaded and the volatile nature of the proposal explored.

Some of the key findings include:

1. The proponents have made a simple but significant error by double counting the Pulp Mills tax benefit to the Tasmanian economy.

2. A benefits analysis conducted by the proponents show an $834 million tax contribution over the life of the project but failed to show the $847.3 million in subsidies provided to the project.

3. The proponents have only provided a benefits analysis to the Tasmanian economy. They have not factored in risks and costs, including:

• Risk of respiratory disease caused by the emissions from the proposed mill, quantified in the report at $350 million;
• The cost to the Tasmania economy from converting additional agricultural land to plantations from to supply the proposed mill, quantified in the report at $403 million;
• Risks to Tasmania’s fishing industry due to dioxin contamination from pulp mill effluent, quantified as a medium risk scenario could cost the industry $693.5 million and 700 job losses over the life of the project;
• Following a survey conducted by the Tasmanian Tourism Industry Council, economists were able to quantify the risk to Tasmania’s tourist industry. With 84% of growth in Tourism attributable to repeat visits, a medium risk scenario will cost the Tasmanian economy $1.1 billion and 1044 jobs over the life of the project.
• If you add up risks to health and other industries plus the costs and subsidies the total is $3.3 billion.

4. Only subsidies provided by the Australian taxpayer makes the mill profitable.

5. Job gains during mill construction may well be offset by the “crowding out” of other development opportunities and job losses elsewhere.

6. On a range of realistic scenarios, the Pulp Mill project may cause an economic loss to the State of Tasmania.

7. The proposed pulp mill does not represent sustainable development for Tasmania.

Download the Roundtable report at www.lec.org.au.

Real estate prices

Despite Gunns claims that real estate values would rise, the real estate records for 2005 to 2007 show that West Tamar properties nearer the proposed pulp mill have declined compared to Legana and suburbs in Launceston.

Download the recent history of property prices in the West Tamar Changes to West Tamar real estate values 225Kb from below.

Serious flaws in the economic case for the mill

Actuary Naomi Edwards presents a powerful critique of the economic case for the mill.

It exposes the flaws in the economic case presented by Monash University (Allen Consulting) which was trumpeted by the Government as justifying the mill. No 114 Naomi Edwards submission 186Kb

The Launceston Environment Centre submission focuses on how the IIS measures up against environmental management systems criteria. It also critiques the economic case.

No 495 Launceston Environment Centre submission 475 Kb

Failure of strategic planning

Scenario planner and consultant Bernard Lloyd describes how the lack of strategic planning by mill proponents exposes the proposal to the possibility of serious risk over the next 20 years.

No 504 Bernard Lloyd submission 44 Kb

Potential impact on abalone industry

The abalone industry submission highlights the value of the industry as a major contributor to the Tasmanian economy and its dependence on Tasmania's pure, natural and pristine image for marketing itself overseas. The submissions show how the IIS ignores potential damage to fishing.

No 353 Abalone Industry submission 150 Kb