The NSW government won't proceed with privatising Forestry Corporation's softwood plantation business as the industry works to rebuild after an unprecedented bushfire season.
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The coalition has decided not to sell off the business after a five-month investigation which took into account recent damage to the state's forestry assets.
About 25 per cent of Forestry Corporation's softwood division suffered fire damage over the summer.
Deputy Premier John Barilaro said the government's priority was to help the forestry industry get back on its feet.
"Re-growing our forests, getting new trees in the ground, and strengthening the industry so its long-term future is secure is where we are focusing our energy," Mr Barilaro said in a statement on Thursday.
Treasurer Dominic Perrottet said the five-month scoping study thoroughly investigated all options available.
"The significant damage to the sector caused by the recent bushfires was obviously a key factor in the decision made by the NSW government," Mr Perrottet said.
Thursday's announcement was welcomed by unions and NSW Labor, which had opposed the privatisation push and criticised the government for putting forestry workers through "emotional turmoil".
Australian Workers' Union national secretary Daniel Walton described the government's decision as a victory for everyone in NSW.
He said it would be a huge relief to forestry workers who spent months battling blazes.
"The recent bush fire crisis has demonstrated that we need to keep this valuable asset in the hands of experienced state forestry workers who are skilled in both fire and wildlife management, skills that are needed more than ever," Mr Walton said in a statement.
"This was always an ill-conceived idea."
Public Service Association general secretary Stewart Little said the announcement would result in a "sigh of relief" in regional communities.
He now wants the coalition to guarantee it will never sell Forestry Corporation.
Opposition natural resources spokesman Paul Scully, meanwhile, said it was great news for timber-dependent rural and regional communities like Tumut, Tumbarumba, Lismore and Grafton.
However, the Labor MP attacked the coalition for putting "hundreds of workers through emotional turmoil for months".
"The government insisted on a grotesque spending spree, doubling the original cost of its scoping study to $1.3 million, while fires raged through forests and plantations," Mr Scully said in a statement.
Australian Associated Press
