A government agency that allegedly spied on a woman to "dig up dirt" has been slammed by Victoria's information commissioner, who said the agency should apologise for its response to her request for information about the alleged spying.

Victorian taxpayers will fork out more than $38 million after state-owned logging agency VicForests was forced to compensate customers and contractors it could not supply with timber and billed the Andrews government for the cost. VicForests chief executive Monique Dawson told a Supreme Court hearing on Friday it had paid out more than $12 million to contractors and $25 million to customers, and sent the invoice to the government.

For Pete Henry, who has worked at the Maryvale paper mill in Victoria’s Latrobe Valley for 42 years, there was no specific time when the decline in white paper began. “It’s been happening for years,” he says. He believes the M5 machine “wasn’t making enough money for the company”.

Japanese paper giant Nippon will close Australia’s last white paper plant, meaning 200 jobs will be lost at the Maryvale mill and native forest logging in Victoria could end sooner than scheduled. The Japanese paper company’s Australian subsidiary, Opal, was one of a few remaining major customers of the state’s native timber industry, which is scheduled to close by 2030, with logging reduced from 2024. In a statement on its website, Nippon said the company would withdraw from the graphic paper business – including paperboard, kraft paper, graphic paper, corrugated board and folding cartons – in Australia and New Zealand.

Native forest logging in Victoria could end sooner than scheduled if a Japanese paper company decides to close down its Latrobe Valley white paper plant, the last of its kind in Australia and one of a few remaining major buyers of the state’s native timber.

State government and union sources expect Nippon Paper Group to permanently discontinue production of office paper at its subsidiary, Opal Australian Paper Maryvale Mill, this week, citing a lack of native timber supply from state-owned logging agency VicForests.

Conservationists and landcare groups have raised the alarm over plans to remove fallen and “hazardous” trees from two forested areas in the Dandenong Ranges National Park on Melbourne's suburban fringe.

State-owned logging agency VicForests has recorded an unprecedented $52.4 million financial loss this year, blaming it on the cost of court cases brought against it by community environment groups. The figure is significantly higher than last financial year’s loss of $4.7 million and the previous year’s loss of $7.5 million.

Forest areas the Andrews government recently set aside to protect the endangered greater glider had been logged before they were gazetted, providing scant additional habitat for the rare possum.

In October, the state government set aside “special protection zones” in native forests across Gippsland and the Central Highlands of Victoria, a total of about 25,000 hectares, to protect the greater glider.

Immediately ending native forest logging across Victoria’s central highlands, one of the world’s most intense carbon sinks, would generate an extra $60 million in benefits for the state this decade alone.

In a challenge to the Andrew government’s ongoing support for logging of native wet forests – a position that Greens are actively campaigning against in the state election – a report by the right-leaning Blueprint Institute to be released on Tuesday finds preserving trees generates more in tourism, water supply benefits, and carbon credits than cutting them down.

Environmentalists who had supported and applauded the government’s move were blindsided — and now say they were tricked by the government. A letter on behalf of six of those groups wrote to Premier Daniel Andrews in late November 2019 seeking “urgent clarification” of the measures they had given public support for.

The claim that 90,000 hectares of old growth had been protected from logging did not match the reality and zones designated as old growth on the map the government released continued to be logged.