FED: Tuckey defends govt spending on pulp mill

AAP General News (Australia)
12-07-1998
FED: Tuckey defends govt spending on pulp mill

CANBERRA, Dec 7 AAP - Forestry Minister Wilson Tuckey today defended the federal
governments multi-million dollar investment in a pulp and paper mill in southern New South
Wales.

He insisted it did not conflict with the coalitions non-interventionist ideology.

Industry Minister Nick Minchin yesterday said the government would provide a $40 million
package to Australian-owned Visy Industries to establish a $450 million kraft pulp and paper
mill in the timber town of Tumut.

"Well I think its all a recognition of whats been happening around the world in terms of
these incentives," Mr Tuckey told Radio National.

"The thing just simply wasnt going to go ahead if there wasnt some assistance from
government."

He acknowledged that during the 1980s governments had favoured a non-interventionist
approach to business.

"Well that was a view held at the time, but not everybody practised it, that was the
problem," he said.

"A $40 million outlay or even a few hundred million over five or six years could hardly be
called an absolutely radical turnaround in policy.

"Theres some simple arithmetic that can be done on these issues. If you can create 1,000
new jobs you are well aware of the benefits in terms of reduced welfare payments and higher
taxes collected."

Environmental issues with regard to the pulp mill had all been addressed, Mr Tuckey said.

"All of those issues have been tested previously. This projects been on the drawing board
for quite some time.

"The only limiting factor of recent times was getting a financial package together that
could warrant the investment by the Visy group.

"Its the federal governments intervention with its Investing for Growth support thats
done the job."

The funding package had no strings attached, and the money would be spent on infrastructure
such as roadworks as well as on the actual mill, he added.

AAP daw/it

KEYWORD: PULPMILL DAYLEAD

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