Decision to defer stumpage is a good one, however BC Liberal forestry critic John Rustad is asking why government is charging an undefined interest rate, when other jurisdictions are not

BC Liberal Forestry Critic John Rustad

While the provincial government in BC has announced it will be deferring stumpage fees it charges forest companies, in the midst of COVID-19 crisis, the former BC Liberal Minister for Forests, and now Opposition Critic, has expressed several concerns.

John Rustad, MLA for the riding of Nechako Lakes, stated, “Forest companies were, and are, asking for help. Big steps are needed to reduce costs”.

Continuing, he observed, “BC has become the highest cost producer in North America under the NDP and unless the cost structure is addressed, the future of forestry in BC will be very challenging”.

Still, and according to BC Premier John Horgan;

“As government, we had already taken a number of steps to help forest communities and the industry because they were facing tough times even before the COVID-19 crisis came along.”

“Now, we’re deferring stumpage fees (with interest) so companies can maintain their financial liquidity, which will not only benefit them, but ideally, forest workers and communities as well.”

Elsewhere however?

Although the Opposition Critic says the move to defer stumpage (as have Alberta and Ontario) is a good one, Rustad is asking why BC has insisted on charging interest (not even a defined rate) when the other jurisdictions did not?

“And why only 3 months during spring breakup and not the six months that Alberta and Ontario have done?”

According to a statement yesterday, from the provincial government, the deferral will leave eligible companies with an estimated $80 million. This is being done so they can pay employees, pay contractors and pay other bills needed to keep their doors open or reopen them faster.

Loaded logging truck headed to the sawmill

“We’re building on other measures we’ve taken to help the forest sector navigate this crisis,” said Doug Donaldson, Minister of Forests, Lands, Natural Resource Operations and Rural Development.

“What we’re announcing may allow some companies to get back online sooner rather than later when we get through the situation we’re in now – or it may save other companies from having to shut down altogether.”

However, according to Rustad, while this will provide some cash flow help for companies, it does not address the fundamental problem of overall costs.

This led the Forestry Critic to conclude, “A strong forest sector needs to be competitive and deserves a government that actually cares about the workers, families and communities that depend on forestry”.