Queensland Flood Disaster

[AtD]

The way the article read, it sounds like the insurance (in NSW at least) only covers specific assets, eg specific pieces of plant and equipment. This is very different to the type of costs the flood levy, etc, are for.

In an ideal world, the states would be consistent, either all commercially insured or all backed by the Cwlth. But getting states to agree is sometimes like hearing cats.

[Wayno]

surely the Fed Govt would be better off gathering funds (from all tax payers) and building a 'future disaster fund'? or perhaps even using a 3rd party insurer (like most states already do) to cover all states together. Should be a better premium than individual states going it alone...

[SRW]

The problem I have with that article is that the 75/25 recovery arrangement applies equally to all the states. How then does it matter that some states have catastrophe insurance or not except for their own bill?

[ricecrackers]

surely the Fed Govt would be better off gathering funds (from all tax payers) and building a 'future disaster fund'? or perhaps even using a 3rd party insurer (like most states already do) to cover all states together. Should be a better premium than individual states going it alone...

how could the government be certain a 3rd party insurer would come through with the money when they often dont for private funds in such circumstances?
and who would insure a whole country and not charge a ridiculous premium for the risk?

i think better value could be had if such a fund were self managed by government. however i dont agree with it either way if it means increasing taxes to fund it.
the federal government should make best with the budget they already have and weigh up the risks of needing such a rainy day fund.

[Nathan]

weigh up the risks of needing such a rainy day fund.

Nice choice of words

[stumpjumper]

SRW wrote:
The problem I have with that article is that the 75/25 recovery arrangement applies equally to all the states

As I understand it, only Qld has the 75/25 arrangement with the federal government (presumably limited to state-owned infrastructure). Other states either carry their own risk or reinsure on the world market.

[stumpjumper]

I hope that Julia's Qld disaster tax doesn't mean that the $200 mill that Anna B has collected from her Premier's appeal goes quietly into her pocket, to re-emerge as electoral porkbarrelling cash.

[rhino]

I hope that Julia's Qld disaster tax doesn't mean that the $200 mill that Anna B has collected from her Premier's appeal goes quietly into her pocket, to re-emerge as electoral porkbarrelling cash.

What he said!

[SRW]

SRW wrote:
The problem I have with that article is that the 75/25 recovery arrangement applies equally to all the states

As I understand it, only Qld has the 75/25 arrangement with the federal government (presumably limited to state-owned infrastructure). Other states either carry their own risk or reinsure on the world market.

No, all states are equally treated under the Natural Disaster Relief and Recovery Arrangements. I think the iffy bit is that the Commonwealth is liable to reimburse the states only for actual and exceptional expenditure, and not for costs recovered or likely to be recovered from another source (5.2.5a) -- perhaps including insurance agencies.

I hope that Julia's Qld disaster tax doesn't mean that the $200 mill that Anna B has collected from her Premier's appeal goes quietly into her pocket, to re-emerge as electoral porkbarrelling cash.

What tosh!

[stumpjumper]

SRW I also read 5.2.5 about recovering from other sources. I also took 'other sources' to include insurers. The language is similar to a clause disallowing multiple insurers for any event - if you have recovered from source A you cannot recover from source B for the same damage.

I think you're misguided about the insurance position. Correct me if you can, but I think the situation is as I described above - only Qld does not insure its public assets.

Queensland Treasurer Andrew Fraser said while the state government did not buy reinsurance on the commercial market, its Treasury Insurance Fund had "sufficient reserve to meet claims".

"Previous market soundings have indicated reinsurance is not cost-effective, given Queensland's history of natural disasters and the length of the state's road network," Mr Fraser said.

The terms of the National Disaster Relief and Recovery Arrangements between the commonwealth and all state governments states: "The commonwealth's assistance is intended to be directed to state measures that complement other strategies in relation to natural disasters, such as insurance and disaster mitigation planning and implementation."

Industry sources have estimated the cost of catastrophe reinsurance for Queensland would range from $50 million to $100m a year.

- The Australian 4/1/11

Queensland Treasurer Andrew Fraser said while the state government did not buy reinsurance on the commercial market, its Treasury Insurance Fund had "sufficient reserve to meet claims" - at the rate of 25% of the cost of any claim! (my italics)

Gillard said today that the feds would cover any amount from now on without raising the levy.

Given that the levy is on taxpayers, and taxpayers will provide any other funds, you have to ask what was the point of a separate levy? Why is Gillard trying to collect a few hundred million dollars via a levy from a targeted group of Australians when she has (and continues to waste in some cases), literally billions in various programs?

Is it to keep the Greens on side - taking back the tax cuts for the 'rich' which the Greens believe should never have been granted in the first place?

Is Julia wedging Abbott, first with a tax that hits his demographic while leaving Gillard’s demographic untouched, and then by using Abbott's opposition to the levy to make him appear as though he is opposed to spending money on the recovery?

Remember that Julia Gillard is one of the coldest, most calculating and opportunistic politicians we've seen for a very long time. As they say, 'Julia represents Julia'.

What is really going on here?

[Aidan]

Given that the levy is on taxpayers, and taxpayers will provide any other funds, you have to ask what was the point of a separate levy? Why is Gillard trying to collect a few hundred million dollars via a levy from a targeted group of Australians when she has (and continues to waste in some cases), literally billions in various programs?

Struth, you're sounding like Tony Abbott!

There are certainly billions of dollars spent on various programs, and naturally the opposition tries to pretend they're all wasted, but the reality is that most of them are well spent. If anything, Julia's being too aggressive in making cuts.

As for the levy, both sides of politics know that the public are more likely to support taxes that are hypothecated and temporary.

Is it to keep the Greens on side - taking back the tax cuts for the 'rich' which the Greens believe should never have been granted in the first place?

Probably not - but considering the effects those tax cuts had on interest rates, it appears the Greens are right on this one.

Is Julia wedging Abbott, first with a tax that hits his demographic while leaving Gillard’s demographic untouched, and then by using Abbott's opposition to the levy to make him appear as though he is opposed to spending money on the recovery?

The evidence suggests he is opposed to spending money on the recovery.

Remember that Julia Gillard is one of the coldest, most calculating and opportunistic politicians we've seen for a very long time. As they say, 'Julia represents Julia'.

Yes. And note the phrase "one of". Several more of them can be found on the opposite bench.

[rev]

Wow, from moaning about the SA state labor gov, to moaning about the federal and Qld labor governments.

[skyliner]

Now 22 dead from the floods and at least one from the cyclone. Our area flooded twice - about 60 Km from Grantham - totally flattened by the 'tsunami' - could be heard 5KM away!

SKYLINER

[stumpjumper]

rev said:

Wow, from moaning about the SA state labor gov, to moaning about the federal and Qld labor governments.

Tragic as the floods and cyclone have been, what if the Qld, SA and federal Labor governments deserve moaning about?

After all, it's not just me and the federal opposition who are complaining - pre-disaster, Bligh's approval was in the 20s and Labor lost around 7 seats in Qld at the last election; Labor would lose a federal election right now, and the Rann government is in the grip of a union minority and is about to appoint a deputy premier and a treasurer based on anything but merit and suitable experience. So yes, I am moaning about all three governments.

Please feel free to defend the magnificent record of any or all of the governments I'm moaning about.

[Isiskii]

There should be a like button available to posts such as the one below.