The Commonwealth and New South Wales governments have announced an additional $742 million for flood-affected communities in the state, including support for businesses and the demolition of damaged buildings.
The Federal Government will also dip into its Emergency Response Fund to pay for flood mitigation measures in NSW and Queensland, after months of mounting criticism from Labor that the Coalition was ignoring the pool $4 billion while accumulating hundreds of millions in interest.
Following devastating flooding on the East Coast, Emergency Management Minister Bridget McKenzie announced on Friday that $150 million from the ERF would be spent on community recovery and to mitigate future disasters. It comes just two weeks after the minister dismissed criticism from Labor and said the ERF was ‘working as intended’.
In a separate announcement, Prime Minister Scott Morrison and McKenzie said the Federal Government would cost-share 50-50 with the NSW Government for a new business and community support scheme.
One hundred million dollars will go to small and medium-sized businesses in the Lismore, Ballina, Byron, Kyogle, Richmond Valley, Clarence Valley and Tweed areas. Medium-sized businesses can access grants of up to $200,000 for cleaning and repairs not covered by their insurance, while small businesses that see a 40% reduction in revenue can get up to ‘at $10,000.
An additional $150 million will go to primary producers, while $35 million will go to rural landowners for costs related to debris or dead livestock removal, livestock maintenance and fencing. The package also includes $142 million for the assessment and eventual demolition of damaged properties, including $50 million “for major businesses and major employers” in the Northern Rivers region specifically.
This is in addition to Thursday’s extension of additional disaster payments to Ballina, Byron and Tweed LGAs, which were originally excluded from the two additional payments given to the Lismore area. The federal government said it had already paid out $653 million to 596,000 people through those grants as of Thursday.
“This support program puts money in the hands of our small and medium-sized businesses and farmers so they can rebuild and help the whole community recover together,” Morrison said.
The support package makes up the bulk of Friday’s flood funding announcement, but the release of the Emergency Response Fund represents a U-turn from the government and McKenzie, who recently claimed the FER n ‘was supposed to be used only after all other sources of funding were exhausted’.
According to Friday’s announcement, the state governments of NSW and Queensland will each receive $75 million “to be spent where they, in agreement with the Australian Government, determine is most needed”, McKenzie said.
“The scale and scale of these floods is exactly the type of event the Emergency Response Fund was designed for,” she added.
The ERF was launched as an investment in 2019 with $4 billion in funding, with the vision that the account would generate interest to fund disaster mitigation projects. It has brought in $836 million in interest since then, but has only paid out $50 million for disaster projects, according to the Department of Finance. An additional $100 million is being allocated.
Labor Emergencies Minister Murray Watt has long criticized the government for not spending the ERF. Its funding rules say it can spend $150 million annually on emergency response and recovery, and $50 million on resilience or preparedness work.
Labor has promised to revamp the ERF if it wins the May election, pledging to spend $200m a year from the mitigation and recovery fund. Watt claimed that the ERF in its current design under the Coalition had “failed”.
“We are now in our third disaster season since this fund was established, it has not built or even begun to build a single disaster mitigation project, and it has not spent a dime on recovery disaster recovery in three years,” he said on Tuesday. .
But the Federal Coalition has already rebuffed such attacks, saying the ERF was already working as intended. Earlier this month, McKenzie defended how the fund worked and how much interest it had accrued, saying it was “actually more of a term deposit”.
On February 28, McKenzie accused Labor of “politicising” the floods by criticizing the response.
“The Emergency Response Fund was created with the support of Labor and is working as intended. It will only be accessible once all other sources of funding have been exhausted,” she told Guardian Australia.
“The fact that the fund has generated so much interest means it is doing exactly what it was designed to do. In fact, it is expected to reach $6.6 billion over the next decade,” the National Recovery and Resilience Agency (NRRA) said on its website.
