Why the Forestry Commission deserves the chop

Back in 1981, the IEA published State Forestry for the Axe: A Study of the Forestry Commission and De-nationalisation by the Market by Robert Miller. Almost thirty years on, the government is now planning to sell off about half of the 748,000 hectares overseen by the Forestry Commission.

Largely untouched by ministers for ninety years, the Forestry Commission, like the BBC, is one of the last few unreformed nationalised industries. With an estate valued in the 1990s at £2.5 billion, transferring ownership to private hands will bring a range of positive economic benefits. As something that even Margaret Thatcher failed to execute during her time as prime minister, this move is long overdue. However, on closer inspection, the government’s plans do not go far enough.

The state runs the Forestry Commission as a huge loss making and heavily subsidised entity. Indeed, why previous governments have let such a quango exist for so long is perplexing. The Commission’s roots lie in World War I, when the government intervened in an attempt to ensure that enough lumber for coal mine tunnels and railway sleepers was supplied to defeat the Kaiser, at a time when Britain felt the need to be as “self sufficient” as possible. However, this type of mercantilist endeavour, where imports are thought to represent defeat, is deeply misguided. Britain probably has no comparative advantage in timber and can import timber and timber products more cheaply than producing them here. By selling off the forests to private companies, the government would be able to end the subsidies as well as raising money to reduce the deficit. The forests’ new private owners would also have strong incentives to increase the economic returns from the land.

The Comprehensive Spending Review suggests that the government plans to “retain and substantially reform” the Forestry Commission. But it is hard to see any kind of economic benefit from the continued operation of any part of the organisation. If the government really is intent on a bonfire of quangos, as it states, then surely this mega quango should be abolished entirely.

4 thoughts on “Why the Forestry Commission deserves the chop”

  1. Posted 03/11/2010 at 22:06 | Permalink

    The Forestry Commission in England costs the tax payer a mere £10million a year , a third of the public funding given to the Royal Opera House and other similar regional institutes around the country. For their money tax payers get access to tens of thousands of acres of wildlife, walks, views, picnic areas, toilets and the trees filter pollutants and produce oxygen. In all there are 40 million visits to Forestry Commission forests a year. Selling to Private Companies will not end the subsidy but increase it as the new owners can then apply back to the Forestry Commission or Natural England for funding to support tree planting and forest management work

  2. Posted 25/01/2011 at 22:28 | Permalink

    Mark Littlewood should not be allowed to think that anyone listening to him today on Radio 4’s ‘You and Yours’ would find any common ground. Not in his carelessly stated wish to take ‘his money’ out of the forestry commission because he isn’t interested in the countryside.
    Certainly not in his bullying performance where he seemed to find himself so amusing. Nothing was brought to mind more than an uncontrollable, untouchable aparatchik rolling a tank over citizens. How far the Conservative party has come around the wheel of politics, it has finally met it’s natural mate – dictatorship.
    A final thought for Mr Littlewood. Millions more people use our public countryside than ever visit a football stadium.

  3. Posted 09/02/2011 at 14:48 | Permalink

    “By selling off the forests to private companies, the government would be able to end the subsidies as well as raising money to reduce the deficit.”

    what rubbish. The government impact assessment makes clear that an additional £12m grants would become eligible and another £12m would have to be paid out in subsidies to maintain existing benefits. So the subsidy would INCREASE. Exactly the same thing has happened with our railways where subsidies have increased to cover the need for private firms to make a profit, rather than simply break even.

    The benefit to government is purely short-term in the form of capital receipts. These will soon be wiped out by increased subsidy and lost taxes – forests are exempt from inheritance and capital gains tax. Hand-off to charities would also have tax implications.

  4. Posted 03/06/2012 at 17:35 | Permalink

    I agree with Sandra Tusin – the Forestry Commission deserves the chop. The main reason it is kept in Scotland is to ensure a constant supply of timber to sawmills when the market dips. However, the private sector could be encouraged/compenstated to fulfil this role. Other reasons for keeping the Forestry Commission have no standing. Public access and conservation issues are currently overlapped excessively by Scottish Natural Heritage (SNH) resulting in a duplication in bureaucracy to the determent of the public purse. Added to this are the forestry grant schemes which are administered both by the Scottish Gov. Rural Inspectorate Payment Department (SGRIPD) and FC; the planning system statutory consultee process carried out by SNH on behalf of FC; and an FC Estates department that could easily be managed by SG Estates. Duplication on bureaucracy is the name of the game in Scotland as I suspect is the case in England. Pro FC comments tend to be FC employees or FC union members seeking to justify the unjustifiable. However, their fears can be alleviated as I’m sure they would soon find new jobs in the forestry industry which is entering into a skills gap and some could be taken on by SNH, SGRIP and SG Estates or their English counterparts. There needs to be a new review in Scotland and England should lead the way. Let’s get rid of unnecessary layers of management who are also in the high public sector pay bands.

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