Cost of Australian floods could be highest ever

Thursday 20th Jan 2011 by theWeather Club

Prime minister Julia Gillard turned to corporate Australia for help in what will be a hugely costly recovery effort following the flooding that has devastated lives and property in five of the country's seven states. The government has already urged big business to dig deep, but prime minister Gillard - who had promised to return the budget to surplus by 2013 - refused to comment on reports that she is mulling a flood levy to aid the recovery effort, saying such speculation is "irresponsible".

However the flooding crisis prompted Australia and New Zealand Banking Group (ANZ) to warn the rebuilding effort in coal mining and farming in Queensland could cost up to AU$20 billion (£12.4 billion). Their spokesperson went on to say: "With the Commonwealth (federal) government likely to foot a big proportion of this rebuild, the 2012-13 (return to) budget surplus is under significant threat." In response to the crisis the government has formed a taskforce of corporate leaders to rally donations from the business community and mobilise support for the mammoth recovery effort. "Already, corporate Australia has been tremendously generous," the prime minister said. "But given the scale of this disaster, we need to do more."

The country's treasurer Wayne Swan has said the floods, which wiped out homes, businesses and crops, crippled the key coal export industry and destroyed railways and roads, could be Australia's most costly natural disaster ever.