VicForests receives annual subsidies from the government and owes the state approximately $8.4 million dollars in un-regenerated forest debt.
Government support of VicForests makes it harder for commercial plantations to compete on price, and keeps an unsustainable native forest logging sector going.
VicForests avoids a range of infrastructure and service costs that commercial plantations would otherwise have to fund. Payment for roads, fire management support, statutory fees and charges that would otherwise cost VicForests millions of dollars each year are avoided under deals agreed with Government. As an example, VicForests avoids paying $23.9 million per annum for road upgrades and damage.
Additionally, VicForests engages in debt write-offs with its customers, such as the writing off of a $10 million debt owed by a Japanese-owned paper mill.