The big lolly scram­ble

New Zealand Logger - - From The Editor -

CAN WE HAVE TOO MUCH OF A GOOD THING? I found my­self ask­ing that ques­tion af­ter reading the lat­est round of the Provin­cial Growth Fund lolly scram­ble; in this case, splash­ing out on tourism, road­ing and forestry projects on the East Coast, to­talling a whop­ping $151.7 mil­lion.

Ac­tu­ally, the road­ing part comes from the Na­tional Land Trans­port Fund, but that’s split­ting hairs be­cause it’s all govern­ment dosh and it’s all be­ing pro­vided by you and me through our taxes.

I’m not go­ing to de­cry the big spend-up – the re­gions have been un­der­funded for years and this is merely try­ing to re­dress the bal­ance.

What I do strug­gle with is the seem­ingly ab­stract way the money is be­ing dolled out and whether it is be­ing wisely spent, es­pe­cially when it comes to the forestry projects an­nounced since Fe­bru­ary.

Once again, I’m not say­ing that forestry is not de­serv­ing of the in­vest­ment. Our in­dus­try has been ig­nored by suc­ces­sive gov­ern­ments for years and much of it sold off to the high­est bid­der and the money spent in other ar­eas. We’re now get­ting some of that back.

But is it be­ing spent in the right places and on the right projects? That’s some­thing I worry about.

In­di­vid­u­ally, you can’t ar­gue with any of the forestry projects that have ben­e­fited from the fairy dust­ing by Forestry Min­is­ter, Shane Jones.

Col­lec­tively, there’s a hotch-potch na­ture to the fund­ing that may not ul­ti­mately de­liver best bang for the bucks. The dom­i­na­tion by the North­land and East Coast re­gions in who-gets-what is skew­ing the ben­e­fits and other re­gions must be won­der­ing what they need to do to catch up. Though I’m not say­ing the Far North and the Far East don’t de­serve it, they do.

The al­ter­na­tive?

It would be more sen­si­ble from a busi­ness point of view to cre­ate a strate­gic plan for the coun­try as a whole and to co­or­di­nate the ac­tiv­i­ties to en­sure that there are cost-ef­fi­cien­cies and cost-ben­e­fits.

We do have some se­ri­ous is­sues to ad­dress; not enough trees have been planted over the last 15 years; not enough in­vest­ment has been made in adding value to the logs here in New Zealand in­stead of ex­port­ing them; and we’re not at­tract­ing enough peo­ple to work in our in­dus­try and pro­vide them with the ap­pro­pri­ate skills.

In the­ory, the Provin­cial Growth Fund is a good idea and is help­ing al­le­vi­ate some of those is­sues. But it is merely ad­min­is­ter­ing a Band Aid, rather than a cure.

It can’t be a proper cure, largely be­cause of the way it’s set up. I liken it to the Lot­ter­ies Com­mis­sion, which in­vites ap­pli­ca­tions from wor­thy causes to which it do­nates the pro­ceeds of prof­its from those of us who play Lotto.

It’s not very strate­gic. It’s not very busi­ness-like. And it’s a bit of a lot­tery as to who gets a share of the $3 bil­lion be­ing made avail­able over three years.

It is bet­ter than noth­ing, but it could be even bet­ter. And that would take strate­gic plan­ning.

NZL

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