Tasmanian government's AU$35M compensation deal with Gunns angers industry, leads to protests outside company's Launceston headquarters

LOS ANGELES , September 15, 2011 () – The Tasmanian government's AU$35 million deal with Gunns to compensate the timber company for exiting its contracts to harvest native forests has generated an angry response, ABC News reported on Sept. 15.

Protests were held outside Gunns' headquarters in Launceston over the payout of $23 million to Gunns and a further $11.5 million to Forestry Tasmania to settle its dispute with Gunns over debt.

Industry leaders say the payout is double the government's original offer. Terry Edwards of the Forest Industries Association accused the government of throwing money at the exercise until Gunns said "that's enough."

Edwards said it was unclear which part of the $276 million Intergovernmental Forest Agreement would be used to fund the payout to Forestry Tasmania, adding that the amount of money left to compensate smaller sawmillers would now be much smaller.

Resources Minister, Bryan Green, said he hoped it was the last time governments would have to provide financial assistance to enable the forest industry to restructure.

Premier Lara Giddings said no money should start flowing to Gunns, or Forestry Tasmania, before the system had been opened to contractors to apply for their funds.

The primary source of this article is ABC News, Hobart, Tasmania, on Sept. 15, 2011.

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