The Insurance Council of Australia has proposed to increase federal mitigation spending to $200 million a year, as recommended by the Productivity Commission Report into Natural Disaster Funding Arrangements.
ICA CEO Rob Whelan said insurers were concerned about the striking imbalance between the government funding for preventing and mitigating disasters, to the amount spent on recovering from their aftermath.
Whelan said: “In June last year, Prime Minister Malcolm Turnbull stood on the rebuilt levee system that shielded Launceston from severe flooding, and noted the need for a greater focus on natural disaster mitigation. Yet less than six months later, the government announced it would not boost mitigation funding to the level recommended by the Productivity Commission.”
He said May's budget presents the Turnbull Government with the opportunity to rethink the decision for protecting communities against natural disasters.
“Lifting federal mitigation spending to $200 million a year, matched by the states, will save significantly greater sums over time by reducing the need to repeatedly rebuild communities after disasters hit,” Whelan said.
“It will also spare many vulnerable communities the distress of seeing homes, business and other treasured possessions destroyed, and improve their long-term viability.”
Whelan said that athough last May's budget saw the increase in federal funding for the National Partnership on Natural Disaster Resilience from $13.4 million to $52.2 million in 2016-17, there is still more to be done.
“The Productivity Commission found funding for reconstruction and recovery consumed 97% of disaster funding in Australia, compared with only 3% that went towards mitigation and community resilience measures,” he said.
“With predictions that the annual cost of natural disasters will rise from $9 billion today to $33 billion by 2050, starting to reverse this funding approach will save lives, property, and money.”
“At a time when parts of Western Australia are under water and much of NSW is burning, it’s important to recognise that prevention is better than cure when it comes to disasters.”
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In its pre-budget submission, a major industry body has urged the Federal Government to re-consider its decision to not go ahead with a $200 million a year disaster mitigation funding.