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The truth about natural disaster funding

New figures have revealed that a Productivity Commission proposal to lift the NDRRA small disaster threshold from $240,000 to $2 million would have cost Queensland councils up to $9.3 million if was introduced before the recent spate of floods and cyclones in the state.

The LGAQ will lodge a supplementary submission to the Commission’s current inquiry using data supplied by the Queensland Reconstruction Authority to illustrate the impact on councils of changing the threshold.

The $9.3 million, based on events over the period March 2009 to January 2014, is higher than the $6.3 million previously estimated by the QRA as that figure only included actual claims received to date.

However, the QRA recognises that further claims up to $9.3 million could be made for these events in accordance with current damage estimates and permitted timelines.

To highlight a couple of events that would have been excluded under the proposed change to the small disaster threshold and the potential impact on councils and their communities:

  • one localised, heavy rainfall event in northern Queensland in October 2011 that affected only one council area (Cassowary Coast Regional Council) caused damage resulting in an estimated $1.3 million of eligible expenditure. This event happened only 8 months after the same council was at the centre of the impacts of Tropical Cyclone Yasi in February 2011.
  • a tropical low in Far North Queensland 3-4 February 2012 caused an estimated $1.9 million in damage across eight remote councils, mostly Indigenous councils which have no rates base to support their revenue.

The LGAQ appeared on behalf of councils at the recent public hearings in Brisbane on 31 October, along with a number of councils who appeared the same day. Queensland local government was also well-represented at the Townsville public hearings held the previous day.

Apart from lodging a supplentary submission to the commission, the LGAQ is continuing to push the natural disaster funding case with the Federal and State governments.

Aurukun tackles telecommunications challenge

Aurukun Shire Council has a serious capacity problem when it comes to its phone and data services, which is why it has begun lobbying state and federal governments for $700,000 in funding to help upgrade its telecommunications facilities.

The remote Indigenous Cape York Peninsula community, located approximately 830km from Cairns and with a population 1,400, is a growth township with housing, community, business and tourism infrastructure being rapidly developed.

Aurukun, which has no ADSL broadband service, currently receives its Telstra and communication services via radio transmission towers, which includes mobile calls, mobile internet and fixed data services.

However, the radio transmission equipment at Aurukun can only support a total transmission capacity of 34Mb – which Telstra says is five times short of a modern, functional system for a community the size of Aurukun.

Aurukun Mayor Cr Dereck Walpo said the slow and poor mobile internet connectivity was causing major, negative impacts in his community.

“In Aurukun, we are experiencing serious phone, internet speed and capacity problems, and we need it fixed as soon as possible,” said Mayor Walpo.

“Council, government agencies, stakeholders and residents are continually frustrated by this deficiency.

“We are a forward-thinking council and community, and we have big plans for the future, especially in relation to tourism and business.

“Unfortunately, we’re being held back at the moment by a poor telecommunications service.

The LGAQ’s innovation executive, Lou Boyle, said the lack of scalable core telecommunication infrastructure in many rural and regional councils was retarding growth opportunities.

 

“Telstra is asking Councils to pay for upgrades, in some instances millions, to ensure communities, including businesses and the state government can access services,” he said.

 

The LGAQ has congratulated the Commonwealth for allocating $100 million to help fix mobile black-spots, but more needs to be done if our rural and indigenous towns are going to progress.

 

Cr Walpo said Telstra had advised the council that necessary improvements would cost $700,000.

 

“The effect on business is also very significant where basic tasks, that are taken for granted elsewhere in the country, are impossible in Aurukun,’’ he said.

 

“Every day, our mobile devices, programs and communications are becoming more and more data hungry, therefore our problem is growing exponentially worse.”

 

 

 

Productivity Commission wrong, wrong, wrong

The impact on councils of implementing a recommended dramatic cut to the federal share of funding for natural disaster recovery and reconstruction would be nothing short of devastating.

This is spelled out in detail in the LGAQ’s submission to the Productivity Commission’s current inquiry into the future of natural disaster funding. Among a raft of recommendations in the Commission’s draft report was the proposal to cut the Federal Government’s contribution to disaster relief from the current 75 percent to 50 percent.  The Commission also wants to lift the threshold that triggers public funding relief for small disasters. The LGAQ insists that, regardless of what else the Government might accept from the Commission’s recommendations, these two measures would put an unbearable burden on local governments. 

“Over the period from 2009 to 2014, Queensland local government would have faced an additional cost of at least $1.3 billion under the draft report proposals,’’ the LGAQ states.

Where would this money have come from? Not from the State Government, which had enough of a struggle delivering its 25 percent share of disaster relief funding following the spate of floods and cyclones since 2010.

The LGAQ also gives short shrift to the Commission’s view that the Natural Disaster relief and Recovery Arrangements, which enshrine the 75/25 funding split between the Commonwealth and the states, are discouraging Queensland councils from insuring their assets.

“As has been independently verified by the Department of Finance and Deregulation, councils comprehensively insure their civic assets despite the ongoing availability of NDRRA funding for natural disaster damage to those assets,’’ says the LGAQ submission.

“Expecting local governments to take out disaster insurance for roads would result in most councils being subjected to crippling premiums.’’

The Commission does have some admirable things to say about the importance of mitigation infrastructure and how current federal regulations hampering the ability of councils to quickly recover from natural disasters.

But most of its draft report into this most fundamental of financial challenges facing local councils is written from the perspective of a federal agency seeking to save federal money. 

The Commission’s draft report is bound to create fireworks at the LGAQ annual conference in Mackay next week.  

       

On the road with digital solutions

You would be hard pressed to find an institution that has a better appreciation of the contribution that technological innovation can make to productivity than local government.  Rather than admitting the potential of technological innovation, the challenges for councils are often in deciding on where to start, how to ensure staff deal with change and setting benchmarks to measure performance.

The LGAQ has organised a series of innovation roadshow of sorts aimed at helping councils make those decisions. Douglas Shire will host the first of these on Friday 17 October.  Neighbouring councils Mareeba, Cook and Wujal Wujal will also attend the event to discuss how technology can be introduced to improve productivity, reduce costs and deliver better customer service. 

The roadshows will also feature executives from Telstra, Apple and Queensland Government to cover topics such as business processes, mobility and apps, the digital economy, mobile black spots, telecommunication infrastructure and strategies for the future.

LGAQ Innovation Executive Lou Boyle says the concept of the roadshow is about trying to address local concerns and share local insights while providing some information from market leaders about the influence of digital change on local government workplaces.

Lou said the LGAQ’s digital productivity report showed that councils wanted to focus on what is possible at a local level and better understand how digital productivity solutions were evolving.

 

Policy galahs and northern Australia

Economic debate in Australia sometimes fixates on a single aspect of reform, chewing it over again and again before finding a way ahead - or not - and moving on.  When he was treasurer in the 1990s, Paul Keating famously observed that if one walked into any pet shop in Australia, the resident galah would be talking about microeconomic policy.  Fast forward to 2014 and it seems the galahs are happy to be chatting about the economic potential of northern Australia.

This week, the Federal Parliament’s Joint Select Committee on Northern Australia tabled its final report.  No doubt it will feature strongly in the Abbott Government’s White Paper on northern Australia, currently in preparation. In recent months, there have been a series of forums organised among business and policymakers to debate the economic potential of the north. Naturally, all of this talk is of great interest to Queensland policy leaders, particularly those in local government. 

The committee’s report is good reading. Much of it is taken up with the policy challenges of improving transport infrastructure, both road and rail, and strengthening security on water supply. It makes seven major recommendations, the first of which is for a Department of Northern Australia to be established (in northern Australia).  Others include giving funding priority to upgrades of the Bruce Highway, the Peninsula Development Road and the Outback Way among other major road links.

And it also calls for continued funding of the Great Artesian Basin Sustainability Initiative, or GABSI, which the LGAQ pushed for following a resolution by members of the Western Queensland Local Government Association meeting in July. GABSI helps control bore water flow and minimise water waste, obviously a key driver of economic growth in the north. With Agricultural Minister Barnaby Joyce indicating the federal government could reinstate funding during this week’s drought tour of properties at Mitchell and Charleville, it looks like momentum is building for a change of heart.

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