Coillte’s controversial decision to work with British wealth manager Gresham House to set up a fund to buy forest land in Ireland is not a government decision, said Taoiseach Leo Varadkar.
The Irish Strategic Forestry Fund aims to acquire 12,000 hectares of forest (planted and unplanted) across the country by raising up to €200 million in capital from Irish and international investors – including €25 million from ISIF, Ireland’s sovereign development fund. Coillte will acquire land, plant trees and manage these forests as part of his overall forest holdings.
Gresham House confirmed in recent days that an estimated 3,000-4,000ha of the fund’s total portfolio will be fallow land; the remaining (about 8,000 ha) will consist of existing forests.
The deal has sparked an uproar among opposition politicians, farm organizations and forest owners, some of whom have called the deal a “land grab” and called on the government to torpedo the plan.
However, Taoiseach Leo Varadkar told the Dail this afternoon that Coillte is a state-owned company, is independent and that its board makes its own commercial decisions.
“This decision was made by Coillte, not by the government or by Minister McConalogue,” he said.
He was answering questions from Social Democrat TD Jennifer Whitmore, who said the partnership between Coillte and Gresham House shows serious flaws in the Government’s approach to forest policy and climate change. In this respect, it contradicts the principle of a just transition.
“This is a lucrative, safe and low-risk investment that the government will subsidize through forestry subsidy programs and tax incentives. There is widespread concern in farming communities that this will drive up land prices.
“Given the Taoiseach’s admission in the Dáil today that this deal was not signed by Cabinet, the question must be asked: why is the government facilitating what amounts to a land grab and what will it do to pull the plug on this partnership? “
When asked why the government was not investing in the forest area itself, the Taoiseach stressed that Coillte is working with the sovereign wealth fund, the Irish Strategic Investment Fund and Gresham House to set up this fund.
“That’s why we’re also investing in this fund,” he said.
Agriculture Secretary Charlie McConalogue, along with Forestry Secretary Pippa Hackett, will meet Coillte on Thursday to discuss the evolving situation.
