Public buyers: Can I get Value for money and meet the timber policy?

The public sector spends over £100 billion each year on procuring goods and services and is required to demonstrate full accountability for actions and ensure the use of best practice whilst at the same time obtaining excellent value for money. Value for money is the primary driver for public procurement. According to OGC’s guidance to public buyers, value for money should always be assessed over the whole life of the contract when considering suitable procurement options. Remember, price is not everything, all costs and benefits to society as a whole including the environmental and social benefits and costs should also be taken into account and of course when procuring timber or wood derived products the Government’s timber procurement policy should be complied with.

Sometimes there is a price premium on verified legal and sustainable timber. In most cases however the premium is only minor especially for softwoods such as pine which is most frequently used. The trade estimates that the premium is as low as 1% for most soft woods. The majority of the softwoods and temperate hardwoods on the UK market originate from areas with good forest management and verifying legality and sustainability of the sources does not require major changes in procedures and therefore doesn’t include a lot of extra costs. 

Conversely, verifying legality and sustainability of hardwoods from tropical regions often involves a lot of effort. Traditionally, tropical regions have produced only a very limited supply of verified sustainable timber and several reports from environmental organisations state that illegal timber from the tropics has and still does reach the UK market. The illegal timber on the market, where taxes and fees have not been paid and where no measures to harvest sustainably have been taken, can of course be sold at a lower price than timber where legality and sustainability is verified. This criminal trade undermines trade in sustainably produced wood, because illegally logged wood is cheaper and should not be supported.  

Example: One of the UK sustainability key criteria is that forest management standards must ensure that biodiversity is maintained (criterion 1.2.6). FSC is one of the forest certification schemes, along with PEFC (SFI and CSA) which have been found to comply with the UK Government criteria for sustainability. Congolaise Industrielle des Bois (CIB) which is owned by Dalhoff Larsen & Horneman A/S (DLH) was the first company in tropical Africa to publicly commit to achieving credible FSC certification and the first concession was certified in 2006. In order to prove that biodiversity is maintained (i.e. that criterion 1.2.6 is met) an inventory of the concessions is required. CIB undertook a comprehensive inventory of tree species and wildlife of the concession area which is almost the size of Northern Ireland. It took three years and hundreds of employees to map their forest concessions in northern Congo. Based on the inventory CIB developed a forest management plan which also included other measures such as: 1) Only to harvest on average one tree per hectare over a 30-year period, giving the forest the right conditions to regenerate. 2) Working with the largely disenfranchised forest-dwelling pygmy groups living inside CIB's concessions. To help avoid felling trees in areas important to the pygmies, they were asked to mark where they live, their burial grounds, and hunting and fishing spots with satellite-tracking GPS coordinates. 3) Set a side an area (over 450,000 ha) to never be harvested.

To implement and monitor the procedures ensuring sustainable forest management in the tropics requires incentive, commitment and investment from the timber company. In conclusion it costs more to produce sustainable timber than it does to produce the timber with no reference to legality and sustainability requirements and some of these costs often result in a premium to the timber when it reaches the UK market. The availability of verified sustainable tropical hardwood on the market is still limited and the risk of procuring illegal timber is high. The first step on the road to full sustainability verification is verification of the legality of the timber. Defra strongly advise not to purchase uncertified tropical hardwoods unless there are no other options, in which case contact CPET for expert, free of charge advice on potential Category B evidence.