By Robert Carry

The proposed development of a $300m canal-estate project in Tasmania's Ralph's Bay ha been hit by a major setback after Tasmania's planning commission recommended the State Government reject the initiative over environmental issues.

The commission found that the project, proposed for a location on a environmental reserve site in the state's south-east, could have netted the state $35m from the reclamation of the Bay's tidal flats. However, after a sustained campaign by environmentalists and residents, the commission concluded that environmental concerns outweighed the economic benefits.

The body's report on the application revealed that the spotted handfish, the pied oystercatcher and other wildlife species would be threatened by the development.

The Walker Corporation, the company behind the proposal, announced details of measures designed to offset the environmental damage but the commission found that they were insufficient.

The report pointed out, “The panel finds that, although well designed and engineered, the proposed development would be a major and unacceptable intervention into Ralphs Bay.”

The Planning Commission is now canvassing public feedback ahead of its final recommendation. The Walker Corporation meanwhile, has said it is reviewing the Draft Integrated Assessment Report.