We are alarmed that the deforestation cap —a proposed new tax on those who convert forests to other land uses still remains on the table, despite assurances from government," says president Peter Berg.

"The cap is arbitrary, punitive and singles out those who planted forests before climate change was even thought of. It is inconsistent with nearly everything else the government is proposing.

"The emphasis needs to be on coherent policies which deal with farming, forestry and potential bio-fuel crops in a consistent and predictable way."

He says forest owners will be pleased that the government has recognised that current policies do not send appropriate signals to land managers about the benefits and costs of land use change.

"The obvious solution is to create markets for carbon, erosion control and other environmental services provided by forestry. This will provide farmers and foresters with certainty about the costs and benefits about their land use decisions."

Mr Berg says the emphasis government has given to forestry in its work programme is heartening, as is the decision to accord priority to policy development for forestry and other land uses.

"However, while the government needs to get its long-term decision-making right, we must remind them that two years lead time is needed before nursery stock can be prepared for planting. In terms of the country's Kyoto liabilities, the sooner we start planting trees the better.

"For this to happen, market-based incentives are required. We strongly oppose ad hoc tree planting subsidies, because of their uncertainty and because their eventual harvest will undermine the economics of those growing trees as a crop."