THE South Australian government will offer a $27 million package to southeast timber millers after negotiations fail with a key player.The government previously offered the cash to timber company Carter Holt Harvey after it expressed concerns for the future of its local operations and the jobs of about 1000 staff.
Treasurer Jack Snelling said today that money would now be offered to other companies.
"Despite months of good faith negotiations, Carter Holt Harvey could not reach agreement with the government on any assistance," Mr Snelling said in a statement.
"After calls from other industry stakeholders, we have therefore decided to create a South-East Forestry Partnerships Program of up to $27 million which will provide a short-term stimulus to drive long-term investment into the forestry industry.
"We know there have been a number of short-term cyclical issues currently facing the timber industry that has meant the industry has been doing it tough in recent times."
Mr Snelling said the government believed the timber industry in the southeast had a bright future and the funds would help drive capital investment.
Manufacturing Minister Tom Koutsantonis said the government would provide cash on a one-for-one basis to encourage a viable and strong timber saw milling industry.
The funding package follows a decision by the government to sell off the next three rotations, or about 100 years, of timber growth in the region, a decision that has caused concern in the southeast with fears jobs will be lost.