Peter Whish-Wilson (Tasmania, Australian Greens) Share this | Hansard source

I move:

That the Senate take note of the document.

I really like that title, Bitter Harvest. Sometimes the names of committee reports can really frame what the committee has discovered. No punches were pulled in this report. Unfortunately, however, the Greens did have to put in a dissenting report at the end. This is one of many inquiries which I have been on in recent years where we looked at financial misconduct. This to me was the most powerful inquiry I have sat on. Being a Tasmanian, over the years I have witnessed the rise and fall of Gunns Ltd. I have witnessed the rise and fall of the managed investment scheme industry—some would say it was a perverse incentive provided by government and legislation to grow the forestry industry in Australia. There may have been good intentions when it was first put up but it led to an absolute catastrophe, not just in Tasmania but right around the country.

The Senate heard evidence that nearly $4 billion of investors' money was put into forestry managed agribusiness schemes—in other words, tree farms—and the whole lot was lost. Many of the investors were mum and dad investors, not sophisticated investors. Not only did they lose their investments but some of them were leveraged into those investments. They went to their accountants and financial planners and they were sent to the company, and the company said, 'If you don't have the money to buy a tree farms scheme to claim against your tax, to reduce your tax, we'll lend you the money.' So they borrowed money to invest in what was a high-risk scheme, but many of them did not understand any of the risks associated with this scheme.

In fact, we found evidence that these tree schemes were sold as being as safe as houses. But they were anything but as safe as houses. Let me say this: ASIC admitted on the last afternoon of the inquiry that these tree schemes were not retail investment grade. They should never have been sold to Australians who were saving for their retirement. I could probably spend an hour or two just going through why they were not retail grade. At the end of the day, these were tax driven schemes—they were driven by tax deductions. Billions of dollars were poured into these schemes so Australians could get deductions to lower their tax. This was all legal; this was set up by the government. Then there was a gold rush of people getting into these schemes, setting them up, taking that money, buying land—good agricultural land, as Senator Duniam knows, in my state of Tasmania—