Senate Legal and Constitutional Affairs Legislation Committee, , 56:14 to 1:00:48
Discussion on the revision of disaster recovery funding activation thresholds from $240,000 to higher levels, addressing concerns about the financial impact on regional councils with small rate bases.
Topics: Government spending, Drought and disaster support
Speakers: Dr Jill Charker, Mr Pat Hetherington, Senator Susan McDonald, Unknown Speaker, Sanandan Dasgupta, Senator Jana Stewart
Uh Chair, thank you. I will just again flag that I have a lot of questions.
We're usually pretty good at sharing the call and managing time, but appreciate you've got lots of questions. Thank you. Uh Senator McDonald, you've got the call.
Um the joint media release between the Treasurer and the Minister for Emergency Management on the 9th of October, the government stated it would be revising funding activation thresholds.
Yeah, Senator, um I can uh assist with that. So uh the current disaster recovery funding arrangements that have been in place for some time have an event uh event-based activation trigger point of $240,000. Um in consultation with um all states and territories and local governments, all the states and territories agreed that that has been too low. It's been in place for many, many years, uh has not been indexed. Um the government then in June uh proposed um an initial uh reform position of new trigger points of either 2.7 million for the larger jurisdictions, being SA at that time, New South Wales, Queensland Victoria and Western Australia, or 1.65 for ACTAS and Northern Territory. Um as Mr. Hetherington and Mr. Minak have indicated uh following extensive consultation and very strong views uh received from local and state and territory governments that those thresholds were then seen as too high. Um in October, uh the Treasurer and the Minister advised a revised set of trigger points or activation thresholds, being either one million dollars for New South Wales, Queensland, Victoria and WA, or 0.5 million for ACT, South Australia, Tasmania and Northern Territory. Um it's important to note that um across the eight jurisdictions in this country, states and territories in turn have their own arrangements with the councils. And so whilst, as the um interim coordinator generals pointed out, these arrangements are between the Commonwealth and the States. These are funding arrangements for cost sharing between the Commonwealth and the States and Territories. It is open to states, and in fact many states currently have additional activation thresholds uh set enormously differently for different councils based on rate bases and other considerations on top of that, which are not set by the Commonwealth.
I think it's important. Um the way the way um we envisage those thresholds was there has to be a certain amount of damage before you can't just be a heavy rain shower. There's going to be a certain amount of damage before you're eligible for Commonwealth assistance. Um we don't think about those costs as being passed on to a local government. That's a state and territory um apparatus that's in place. So we think if in under the new thresholds, if Queensland had an event that caused more than a million dollars worth of damage, then that would be that would meet the activation threshold. Um it's not it's not the Commonwealth's position that those costs be passed on to local government. And as Dr. Chark has outlined, um there are a range of different arrangements across every jurisdiction uh where those costs are passed on based on a whole bunch of factors, including rate-based. Etc. But that but that is not that's not a feature of the system that's controlled by the federal government.
So uh could you provide on notice any modelling that's been done to support uh the first activation level and now this updated activation level, or if it's just a negotiated number?
Yeah, I can take it on notice, Senator. I mean, in in very broad terms, the first set of activation thresholds were based on some modelling done by the Productivity Commission some time ago, updated for price, and the second set of activation thresholds are similarly price updated based on historical numbers, but we'll take that on notice and come back with some detail.
Uh while councils appreciate retaining the ability to claim costs under counter-disaster operations, what recovery measures will be included in this.