A forestry sector organisation that took at least $71 million in public funding to deliver skills and training to Victorian forestry workers and their families failed to demonstrate its programs worked, and may have given payments to ineligible workers.

Meanwhile, a lengthy investigation into transition-related funding, subsidies, compensation payments and industry supports, conducted by not-for-profit Environmental Justice Australia and supported by forensic accounting undertaken by Clarium Forensics, could find no public records for much of the $1.5 billion invested by the Victorian government into the sector.

The EJA and forensic accountants found public records and reports of only $884.7 million being spent directly, leaving $615.3 million unaccounted for.

“There is no consolidated public account of the transition funding,” said EJA co-chief executive Nicola Rivers.

“The government has not said anywhere where it’s actually gone [and] which organisations and companies have received the money in full, and so it’s very difficult from publicly available records to know where the money went, or whether any conditions were applied to the payments, or whether any of the outcomes of the transition were actually achieved.”

Late on Monday evening, a state government spokeswoman outlined a list of initiatives funded under the $1.5 billion forestry transition package that amounted to $1.51 billion, without details of or links to the programs.

These included $200 million for timber harvesting transition support for sawmill businesses and workers, $151.9 million for active forest management, bushfire management and road maintenance, and $193 million for targeted timber industry and worker transition support services.

In 2023, then-premier Daniel Andrews announced $875 million in funding – later expanded to $1.5 billion – to support the transition of the forestry industry after the official cessation of native logging in January 2024.

In separate findings handed down in April, Victorian Auditor-General Andrew Greaves took aim at ForestWorks – an industry-owned not-for-profit that has supported about 95 per cent of the forestry Worker Support Program recipients at a cost of about $71 million.

The organisation, Greaves said, failed to keep accurate records and issued hardship payments to 32 people who also received other government support. Eligibility for hardship payments was restricted to workers experiencing significant hardship, who were not receiving other government payments.

Greaves’ report found that while there was ambiguity in the definition of government support, the department could not show how it assessed the workers’ eligibility.

“To administer the Worker Support Program, ForestWorks must assess workers’ eligibility using the department’s criteria,” Greaves found.

“But when we reviewed a sample of 50 worker case files, none contained an eligibility assessment to show that workers met the criteria to participate in the Worker Support Program.”

ForestWorks chief executive Mike Radda said the transition from native timber harvesting had been “complex, challenging and deeply personal for many workers and communities”.

“ForestWorks remains committed to placing workers at the centre of transition support and to working constructively with government and industry on future workforce transitions,” he said.

“We are proud of the outcomes we delivered for workers noting the challenges of helping them secure work in rural areas. ForestWorks welcomed the audit’s focus on continuous improvement and supports stronger monitoring, clearer program rules and better outcome evaluation in future workforce transition programs.”

ForestWorks, according to records held by the Australian Charities and Not-for-profits Commission, had a reported revenue of $23.67 million in February. The overwhelming majority of its revenue – 99.47 per cent of it – came from government funding.

It has strong ties to the Construction, Forestry and Maritime Employees Union (CFMEU), to which it paid $619,990 in 2025 for services, director fees and rent. Two members of ForestWorks’ six-member board list their CFMEU qualifications on their biographies.

ForestWorks also partnered with the CFMEU to provide onsite support for Opal Australian Paper production workers and their family members as part of the transition arrangements.

In his investigation into the transition from native forest logging, Greaves found the Department of Energy, Environment and Climate Action (DEECA) had scant evidence of the employment outcomes for many people who completed the taxpayer-funded training.

“Without evidence, the department cannot check the accuracy of ForestWorks’ reported results,” he found.

“We looked at a sample of 50 participants’ case files. The records show participants’ invoices and claim forms for education and training expenses. But they do not include attendance logs or completion certificates. This means the department cannot confirm whether participants completed training or the extent the funding helped redundant workers to secure new jobs.”

The auditor-general recommended, in findings accepted by DEECA, that the department standardise assessment documentation, strengthen the oversight of delayed payment arrangements, clarify the accountability of quality assurance and record keeping, and embed proportionate and risk-based reviews at key decision points.

Before native logging was officially ended in 2024, VicForests – the government agency responsible for the state’s logging operations – was losing money fast. Annual reports show that between 2019 and 2023, the organisation recorded $127 million in financial losses, while it relied on $466 million in government support between 2019 and 2024.

Among the $884.7 million Environmental Justice Australia identified in spending on transitioning workers, the largest sums went to native forest mills, haulage and harvesting contractors, VicForests, worker transition programs and plantation investment initiatives.

Australian native timber – including that from Tasmanian native forests – continues to move through Victorian supply chains despite some mills receiving transition funds.

But less is known about the financial arrangements governing the Australian Sustainable Hardwoods (ASH) mill at Heyfield, which is 49 per cent owned by the Allan government.

Correspondence seen by this masthead confirms that five freedom-of-information requests submitted by EJA seeking contracts, business cases and other documents clarifying the business arrangement and government investment in the Heyfield mill were rejected for cabinet confidentiality and privacy reasons.

When the cessation of native logging was announced in 2023, then-environment minister Ingrid Stitt said the transition would come with “the largest expansion to our public forests in our state’s history – further protecting our precious biodiversity and endangered species”.

Three years later, no new national parks in the state’s east have been announced. Three new national parks in the state’s central west had already been committed to before the cessation of native logging was announced.

Rivers, the EJA co-chief, said a core promise had not been met.

“Ending logging operations is not the same as permanently protecting forests, and although that VicForest [logging] system has ceased, none of the 1.8 million hectares of Victorian state forest that was formally managed under that native forest logging system in eastern Victoria has been put into a tenure that actually protects native forests from logging and mining,” she said.

“So that really core promise when the transition was announced has not been achieved.”

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CLARIFICATION

This story has been updated to reflect the Auditor General’s finding that hardship support recipients may have been ineligible under the scheme’s rules.  A response from ForestWorks has also been added.

Bianca Hall is The Age's environment and climate reporter, and has worked in a range of roles including as a senior writer, city editor, and in the federal politics bureau in Canberra.Connect via X, Facebook or email.