This week’s Victorian budget includes plans to shut down the state’s logging industry. 

The Andrews government has revealed plans to completely halt native timber logging by the end of this year, significantly accelerating the industry's demise. 

The timber sector in Victoria has long been grappling with challenges, including devastating bushfires, strict environmental restrictions on logging, and unfavourable court rulings, all of which have curtailed the available timber supply year after year.

This recent announcement represents a significant advancement of the original 2019 plan outlined by the Andrews government to phase out native timber logging by 2030. 

It includes a comprehensive transition package worth over $200 million, with workers receiving detailed briefings on the decision.

The package aims to support workers and their families as they transition out of the beleaguered industry by the year's end. 

With a total support amount of $875 million, including existing worker assistance programs and funding for the shift to plantation timber, the government hopes to alleviate the anticipated difficulties faced by those affected.

This decision is likely to have a profound impact on regional Victoria, as the repercussions ripple through the local economy. 

However, the government's transition package offers workers various opportunities to retrain in sectors such as manufacturing, agriculture, transport, and construction through the Free TAFE program. 

To encourage diversification, affected workers will also be eligible for retraining vouchers of up to $8,000 for courses outside of the TAFE sector.

Native timber mills will also have the option to participate in a voluntary transition package, allowing them to choose between remaining in the timber processing field or shifting to alternative industries. 

According to the Victorian Association of Forestry Industries, over 21,000 individuals are currently employed in forestry and the wood products sector, with approximately 4,000 individuals engaged in the native forestry supply chain. Other studies have estimated this figure to be around 2,200.

While the government's support package provides some relief, a portion of the industry's workers has expressed shock and concern regarding the early closure announcement. 

Jono La Nauze, CEO of Environment Victoria, described the current situation faced by the native timber logging industry as “untenable”. 

He pointed out that repeated court rulings have highlighted the crucial importance of these forests as critical habitats, leading to restrictions on logging due to their significant impact. 

Additionally, the escalating effects of climate change and the environmental damage caused by past practices have further exacerbated the challenges faced by the industry.

La Nauze emphasised the need for continued forest management and restoration, as well as the ongoing management of fire threats to both nature and human settlements. 

He expressed hope that today's budget would allocate significant resources to secure the future of those workers who remain in the forest industry, enabling them to derive public benefits by preserving and restoring forests.

Some sawmills have already ceased operations due to the depletion of their timber supply, leaving their workforce in a state of uncertainty. 

VicForests, the government-owned logging company, halted harvesting in November last year following an unfavourable Supreme Court ruling. 

The court found VicForests guilty of failing to adequately protect endangered species such as the yellow-bellied glider and the greater glider in Central Victoria and Gippsland. 

The ruling compelled VicForests to conduct more rigorous surveys for these species in logging areas, expand protected zones, and maintain minimum levels of eucalyptus trees where gliders were identified.

However, VicForests' most recent annual report paints a troubled picture, with a loss of $54.2 million in the 2021-22 period. 

Delays and operational constraints led to stand-down payments of $6.2 million to contractors, while an additional $7.5 million was paid in compensation to customers for the company's failure to fulfil contracted timber volumes.