State abandons plan to sell off Coillte's tree harvest rights
THE Government has abandoned plans to sell the harvesting rights for the state-owned forests.
Instead, a scheme is being drawn up for an overhaul of Coillte, which will lead to its possible merger with state-owned peat company Bord na Mona.
But the sale has not been ruled out in the future.
Coillte was one of the semi-state companies slated for sale under the privatisation programme known as New Era.
For Coillte, privatisation plans were expected to involve selling the rights to cut down forests, but not the land the trees are planted on.
Public Expenditure Minister Brendan Howlin said now was not the "appropriate time" to press ahead with the harvesting rights sale.
"Our due diligence has indicated that it is not prudent to go ahead and sell the trees in that way and it will not be happening," Mr Howlin said.
"Instead we are having an evaluation of the future of Coillte."
Mr Howlin said the decision was taken following a number of financial, technical and specialist reports prepared late last year that concluded that selling Coillte's harvesting rights would have major implications for the survival of the remainder of the business.
As part of the privatisation programme, the State is also looking to sell Bord Gais Energy, which is expected to be followed by sales of some ESB power stations and the government shareholding in Aer Lingus.
All of the disposals are being handled by the New Era agency, on behalf of the Government. The hope is to raise €3bn.
Privatising parts of the ESB and Bord Gais were the priorities, with the separate sale of the Lotto already under way.
A report by economist Peter Bacon said the Coillte sale made no financial sense. A price of €1.3bn would be needed to make up for the loss of 80 years of profits, he said.