cost of natural disasters to victoria

NATURAL DISASTERS AND A WARMING CLIMATE | 1

Natural Disasters and a Warming Climate Understanding the Cumulative Financial Impacts on Victoria

Tom Delbridge & Cam Walker

Friends of the Earth

Dedicated to the volunteer and professional fire-‐fighters


and emergency services workers of Victoria.

Images sourced from wikimedia commons.

http://commons.wikimedia.org/wiki/Main_Page

Friends of the Earth, January 2014

Friends of the Earth (FoE) Melbourne is a membership based environmental organisation

which has been active in Victoria for 40 years. FoE is working towards a socially just and ecologically

sustainable future. It is the local member of Friends of the Earth International, the largest

grassroots environmental network on the planet, active in more than 70 countries.

Box 222, Fitzroy, 3065

[email protected] www.foe.org.au


“Australia is a fire prone country and has always experienced bushfires. (However) all extreme weather events are now being influenced by climate change because they are occurring in a climate system that is hotter and moister than it was 50 years ago.”

-‐ The Climate Council bushfire report

-‐

Introduction and context Public debate about climate change focuses on many aspects of this complex problem. Some parts of the mainstream media continue to allow debate about whether human induced climate change is actually happening. In various theatres, climate change is discussed as a scientific, environmental, technological, human rights and political issue. Discussions about the economic implications of non-‐ or delayed action continue to appear from time to time. Here in Victoria, we have a state government which has effectively walked away from meaningful action to reduce (or mitigate) our greenhouse gas emissions. It has retained some aspects of the previous governments adaptation strategies, but effectively abandoned its responsibilities when it comes to responding to the coming crisis of climate change. Given what we know about the need for serious, strategic and sustained action across the globe to reduce our emissions to a sustainable annual carbon budget, it is clear that there is an urgent need for all levels of government to play their part in reducing emissions.


The Victorian government is responsible for energy policy at the state level and also approvals for new fossil fuel projects. Both are obvious points where there are imperatives to change current policy and practises. There is also a human rights dimension to the climate change story. As pointed out in our report Climate Change and Equity in Victoria (2007) and many other research reports, climate change will impact most directly on low income communities. In Victoria, this is likely to include older people and people on limited incomes who do not have the financial ability to be able to afford to cool their houses in times of extended heat waves, and people with limited or no personal insurance whose properties may be impacted by bushfire or flooding. One of the dominant narratives of the Coalition is that it is a good and prudent manager of the economy. Yet it is clear that there are already various economic impacts of climate change that are being felt across the state. What this report seeks to highlight is the fact that the government is ‘flying blind’ when it comes to tracking the economic and social impacts of natural disasters. Natural disasters will be one obvious point of direct impact by climate change. To the best of our knowledge, no one as yet has sought to bring together the data identifying the cumulative costs of natural disaster events on the state. Our assumption in compiling this report has been that there is little public or government awareness of the cumulative financial cost of these events. This is partly because of the nature of media reporting (which tends to focus on the immediate impacts of natural disasters as they occur rather than placing them in context) and the fact that there is no single line item in the state budget that outlines the cost of these events. The figures outlying the public costs are held by different parts of various government departments, meaning it is difficult to gain an understanding of the overall impacts of natural disasters. In compiling these figures, we have looked at a 10 year period (from 2003 – 2013). This report has complied various loss statistics from Victoria disaster events, although many statistics are estimations of the loss cost rather than true cost. This is often the case as it is often very difficult to account for or estimate the true cost of a disaster event. These figures are conservative and do not even attempt to deal with the deep personal impacts on people, families and communities who are affected by natural disasters. We have considered the key forms of natural disaster which have a climatic dimension. They include:

• Bushfires • Drought • Heatwaves • Floods.

We are certainly not suggesting that climate change is responsible for individual disaster events. Victoria has always suffered heat, drought, flooding and fire. But there can be


little doubt that with unchecked climate change, the costs of such events will continue to grow. And unless we know how much they are costing us already, it will be difficult to budget for the coming impacts of more extreme disasters. According to the figures that we compiled, a conservative estimate is that natural disasters in Victoria over the past 10 years (2003 – 2013) have cost almost $20 billion. Of this figure, $6.762 billion was from government/ public funds, and the remaining $13.174 billion came from insurance payouts. It is worth considering this figure in comparison with other things that the government could be spending the money on. For instance,

• In 2013-‐14, general Victorian government sector investment in roads, public transport, health, schools and other infrastructure is expected to total $6.1 billion

• The new Bendigo Hospital = $630 million • In 2013-‐14, the Coalition Government invested over $3.3 billion in capital

projects. • Since coming to office in late 2010, the Coalition Government has, and is,

investing each year an average of around $5 billion on infrastructure • The East West Link project is expected to cost between $6 and $8 billion • The state government is allocating $100 million towards the Bayside Rail

Improvement for improvements along the Frankston rail line • The new Waurn Ponds Community Hospital will cost around $50 million • $261 million = 40 new regional train carriages

Source: http://www.dtf.vic.gov.au/Publications/State-‐Budget-‐publications/Budget-‐Information-‐Paper-‐No-‐2-‐Infrastructure-‐Investment Climate Change Context. Despite recent various warm weather anomalies, including the latest warm winter and the abnormally early fire events in New South Wales, certain commentators flatly refuse to acknowledge or even discuss the impact that a warming climate might be having on the frequency and severity of natural disasters. The fires that recently wrecked havoc in significant sections of the Blue Mountains of New South Wales were fostered by consistent unseasonably high temperatures and lower than average rainfall in the proceeding months. We are not suggesting that the warming climate started the catastrophic fire events that unfolded in October 2013, but to ignore a discussion regarding the influence of background warming is to be blind to the potential truth. As was shown in the most recent IPCC report, it is clear that humans are responsible for global warming and that serious action is required to reduce global greenhouse emissions immediately. The science is compelling, yet both state and federal governments are choosing to ignore or down play it. The new federal government is sending mixed messages about the reality of climate change and is steadily dismantling most climate change related policies and institutions. The state government has chosen to walk away from previous commitments to reduce greenhouse emissions. Politicising


the debate about how we should respond to climate change is detrimental to framing and achieving an adequate response. There is a clear consensus within the scientific community about the need for action to reduce emissions. We believe that there is also a compelling business case that can be made to help build the will of governments to take action to mitigate the effects of a warming climate. Therefore, this report seeks to quantify the cumulative financial impacts of natural disaster events over the last decade in Victoria; in order highlight the size of these costs, and the fact that without action to reduce greenhouse emissions, we have to expect that these costs will increase over time. The economic and insured costs of natural disasters due to extreme weather – tropical cyclones, floods, bushfires and storms – are rising in concert with growing concentrations of population and wealth in disaster-‐prone regions. A contribution to these rising costs has not yet been attributed to anthropogenic climate change, although such a contribution cannot be ruled out (McAneney, Crompton, McAneney, Musulin, Walker, & Pielke, 2013). The Intergovernmental Panel on Climate Change (2012) says that evidence from climate change research suggests that some natural disasters can be expected to increase in incidence and severity in future years, with significant impacts in at-‐risk areas. Bruce, Burton & Egener (2000) ask how climate change might affect the frequency and severity of extreme weather events. They start by stating that firstly, it is believed that the additional warming will change the distribution of heat and thus the flow of energy through the climate system. This will, in turn, alter the circulation patterns of the atmosphere and the oceans, and it will also modify the hydrological cycle by which water is circulated between the Earth’s surface and the atmosphere. As a result, the position of many of the world’s major storm tracks could shift significantly (p9). A study published in the journal Nature Climate Change says reduced emissions would prevent hundreds of thousands of premature deaths a year and up to three million annually by the end of the century (Ross, 2013). Some insurance companies already encourage climate change adaptation by underwriting green projects, undertaking research and generally engaging in policy debate on climate change issues. We expect this to continue. However responding to climate change is not the key objective of these commercial entities that in the end must answer to shareholders and annual reporting periods (McAneney et al, 2013). It is the responsibility of the Victorian and Commonwealth government to take action to mitigate climate change in order to support the people they serve, the taxpayers. Recent catastrophes have highlighted many challenges, including how to best organise systems to pay for the damage caused by natural disasters and how to plan for and mitigate their effects. Insurance (public and private) plays a critical role in providing funds for economic recovery after a catastrophe. Insurance, however, merely transfers risks to others with a broader diversification capacity; simply purchasing insurance does not reduce the risk (McAneney et al, 2013, p20).


Risk reduction comes through government climate change action and mitigation, and with what climate science is clearly telling us, it is high time for both levels of government to take charge. Mitigating disasters and climate change. In geological terms, Victoria is located in a relatively stable part of the world, with a history of regular but low impact earth tremors. It has a Mediterranean climate with a fire adapted biodiversity and experiences one of the most severe fire seasons on the planet. It is in a temperate climatic zone, so is not affected by tropical storms. It has a well resourced and well developed emergency services infrastructure. As a state within one of the richer countries in the world, it is well resourced to respond to natural disasters when they do occur. Victorians have co-‐existed with bushfires since the time of European colonisation. What is now different is the influence of human induced climate change on pre existing patterns of disaster. Many people recognise the importance of creating and implementing disaster mitigation programs before these events occur. Although once this argument is framed from a climate change perspective, many authors start to contest the proposal that there is a strong linkage between the phenomena of climate change and disaster severity and quantity. Until a stronger link can be made between the frequency and severity of disasters and climate change, many are of the opinion that there is no legitimate rationale to implement major mitigation action. It is largely recognised that Australia is exposed to both frequent and large scale natural disasters that have the ability to majorly disrupt economic activity, destroy ecosystem services, place major burdens on state and commonwealth government, lead to death, injury and dislocation, and ruin private property. The Australian Business Roundtable for Disaster Resilience and Safer Communities (ABRDRSC) (2013) states that even without factoring in any findings from climate change research, there is clear evidence that the costs of natural disasters have risen materially over time. It is likely, therefore, that forecast costs presented, and which are relied on in their report, are often conservative (P17). Any delay in further development of disaster and climate change mitigation efforts will seriously undermine Victoria's ability to protect it's human and natural assets. Irreversible changes could well have already occurred to Victoria's economic activity, ecological assets, physical infrastructure and services which could have been prevented through adequate mitigation efforts. Bruce, Burton & Egener (2000) state that it would appear that sufficient economic and social benefits may flow from actions that improve disaster prevention and mitigation to justify these activities on their own merits. Full consideration needs to be given to the beneficial budget impact of outlays on disaster resilience – and research shos that funding allocated for pre-‐disaster mitigation


activities now will reduce public money spent on post-‐disaster recovery in the future (ABRDRSC, 2013, p17). Disaster cost estimates. As outlined above, this report has focused on bringing data together to identify the costs of natural disaster events. This is in order to highlight the cumulative financial cost of natural disasters to the state of Victoria over the past 10 years (2003 – 2013). This report has complied various disaster loss statistics from Victorian disaster events, although many statistics are estimations of the loss cost rather than true cost. This is often the case as it is often very difficult to account or estimate the true cost of a disaster event. Keating and Handmer (2011) state that disaster cost estimates in Australia are largely drawn from insurance data or insurance data with some augmentation; the estimates that utilise insurance data are a limited proxy for disaster cost. Relying on insurance data for estimating the incurred cost of disasters to Victorians severely under appreciates the cost that faces the Victorian taxpayer after these disaster events. Insurance data only account for insured losses, and these represent only a fraction of the total cost of a disaster. In particular they do not include many indirect costs, valuations for loss of life, nor intangibles such as ecosystem services which can have significant impacts on cost estimates. Despite this uncertainty policy makers are under increasing pressure to utilise economic cost benefit type analysis to establish the business case for climate change adaptation initiatives (Keating & Handmer 2011). Relying on insurance data to make a case for disaster and climate change mitigation measures severely undermines the other unaccounted costs that face the Victorian and Australian taxpayer, the environment and the community. Once it is realised that insurance data alone can’t demonstrate these 'public' costs, the task of estimating full disaster costs becomes more complex. Bruce, Burton & Egener (2000) state that compilation of reliable global or even national disaster loss statistics is a notoriously difficult task in part because there are no standardised approaches to such estimates (p10). Other complex elements that must be considered is how to valuate cost items that are not often valued in monetary terms. Keating and Handmer (2011) mention that several other cost items such as those relating to ecosystem services, such as natural water filtration and carbon sequestration, are not currently insurable. Stephenson (2010) finds that estimates of the economic value of ecosystem services can add massively to the overall cost of a disaster. The Australian Business Roundtable for Disaster Resilience and Safer Communities, (2013) estimated that in 2012 alone, the total economic cost of natural disasters in Australia exceeded $6 billion. Further, these costs are expected to double by 2030 and to rise to an average of $23 billion per year by 2050, even without any consideration of the potential impact of climate change (p8). With such a significant price tag estimation, one would could assume that the Australian government has invested a significant amount to start to combat the reality of these figures and reduce the impending costs.


Timeframe. This report looks at the known economic costs of natural disasters in Victoria over the period of a decade. This timeframe was selected because it gave a good likelihood of getting a general sense of these costs on average. Picking just one or two years could give a skewed sense of the costs, depending on the climatic conditions in that period.


Summary of natural disasters This report covers the key Victorian fire, flood, storm and heatwave events of the past decade.

Bushfires Wild fire events were very frequent in the state of Victoria over the past decade, and were intense and costly for the residents affected by these disasters. The severity and frequency of these events reinforce the suggestion that bushfires in Victoria are going to become a more intrusive aspect of life in the state. There have been five major fire seasons in Victoria in the past decade. These have been the 2003, 2005, 2006, 2009 and 2013 fire seasons, which all devastated local communities, interrupted economic activity and caused widespread damage to ecosystems and the natural services they provide. Most Victorian vegetation is fire adapted, and natural bushfires have always been considered a necessary element to local ecological processes and play a part in native regeneration. “The combination of drought, climate change and unnaturally high fuel loads however, has created an unprecedented bushfire risk” (DSE & CFA, 2008, p1). When reviewing the bushfire events over the last decade in Victoria it becomes apparent that these fires have had extensive negative social, environmental and economic impacts. “The losses associated with these impacts extend beyond the clearly visible suppression activities and building losses to include less obvious direct and immediate costs (e.g. commercial timber losses), as well as indirect (eg. soil erosion) and long-‐lasting (e.g. psychological trauma) impacts” (Stephenson, 2010, p2). Climate change is a global phenomena which will inevitably lead to a greater likelihood of these fire events causing severe damage to local communities and biodiversity. As fires become more frequent and fire seasons (those periods of the month when there is a greater risk of fire activity) grow longer, there will be economic and human consequences

of maintaining effective fire fighting ability for longer periods of time. The 11th chapter of the second working group of the 2007 Intergovernmental Panel on Climate Change, for example, warned that fires in Australia were "virtually certain to increase in intensity and frequency" because of steadily warming temperatures over the next several decades (Walsh, 2009). It is important to acknowledge that the influence of a changing climate and rising temperatures cannot be attributed solely to


the severity of individual fire events. The growing threat from wildfire is a complex combination of factors arising from legislation, administrative arrangements, planning policies, land use practices, local under-‐preparation, a lack of investment in mitigation and disaster planning, and climate change. The importance of fire disaster mitigation comes to the fore when the true costs of fire suppression and recovery are quantified. Private losses are seen to be losses to the individual, and public losses are seen to be those incurred by the Victorian and Australian taxpayer. Both these types of losses have been quantified below for each fire season, and a cumulative total with be calculated to demonstrate the financial burden that these disaster place on all Victorians. Figure 1 (below) demonstrates the upward trend overtime of the number and severity of bushfires in Victoria. 2003: Eastern Victorian (Alpine) Fires. As Victoria approached the 2002/03 summer,

several years of less than average annual rainfall had left the State’s forests and woodlands particularly vulnerable to bushfire (Wareing & Flinn, 2003). The scene was set for a potentially record-‐breaking fire season and the reality was not far from this speculation. The North East/East Gippsland firefighting efforts encompassed Victoria’s largest fires on record since the Black Friday Fires of 1939 (Rees, & Morgan, 2003). Eighty seven fires were started by lightning in the north east of Victoria on 8 January 2003. Eight of these fires were unable to be contained -‐ they joined together to form the largest fire in Victoria since the 1939 "Black Friday" bushfires (DSE, 2003).


Burning for 59 days before being contained, the Alpine fires burnt over 1.3 million hectares, 41 homes and over 9,000 livestock, with thousands of kilometres of fencing also being destroyed. Areas affected include Mt Buffalo, Bright, Dinner Plain, Benambra and Omeo (DSE, 2003). With the size and severity of the fires, the scale of the suppression and recovery operations had not been witnessed or carried out in Victoria before. This context led to both successful operations being carried out by the relevant emergency services, as well as failures endured by residents and services due to the lack of disaster mitigation employed before the event and fire fighting resources being stretched beyond capacity. The DSE, as the lead agency, was supported by thousands of personnel from State Government agencies, the Country Fire Authority, Shires, community organisations, private companies, and interstate and overseas land management and rural fire agencies. This successful co-‐operative campaign led to the containment of the fires, which burnt over one million hectares, or almost 5% of Victoria and 15% of the State’s total area of public land (Wareing & Flinn, 2003). Costs of the fire, (DSE, 2013): At the peak of the North Eastern and Gippsland fires, some firefighting rotations involved the following resources:

• Over 1,700 CFA volunteers • 3,350 DEPI/DPI/PV staff & firefighters • 120 Army/Navy personnel • 120 SES staff & volunteers • Metropolitan Fire Brigade staff • 584 SA personnel • 31 Tasmanians • 68 QLD personnel • 62 New Zealanders • 35 US personnel • A large number of volunteers in support roles • 350 specialised 4WD (slip-‐ons) • 81 4WD Fire Tankers • 31 First Attack dozers • Around 80 large bulldozers from DEPI, the timber industry and the private sector • 6 reconnaissance-‐type aircraft • 8 light helicopters • 10 fixed-‐wing aircraft • 6 fire bombing helicopters • 2 infra-‐red mapping aircraft • 2 Erickson skycranes • Over a dozen crew transport aircraft


Recovery effort. A Ministerial Taskforce for Bushfire Recovery was established by the then Premier Steve Bracks, to assess the impacts of fires on the economy, infrastructure, industries and communities in Victoria and quickly put in place a range of recovery measures (DSE, 2013). The task-‐force released an interim report in February 2003, detailing $13.9 million of recovery action (DSE, 2003). A range of other initiatives were then implemented and outlined in the final report. The Final Report of the Ministerial Taskforce on Bushfire Recovery outlined spending by the Victorian State Government totalling $201 million in response to the bushfires. This was made up of a $13.9 million package to provide immediate recovery support to fire affected communities, $115 million in fire suppression costs, $3 million in financing support for concession loans through the Rural Finance Corporation, and other initiatives totalling $69.4 million. These other initiatives were in three key support areas: financial assistance, social support assistance, and the promotion of volunteer input from the wider community (Gangemi et al. 2003) Other Initiatives announced in this report include:

ñ Recovery of catchment and water protection $23.9 million ñ Restoring assets in parks, forests and alpine resorts $24.9 million ñ Restoring ecological and cultural heritage $13.2 million ñ Rebuilding of roads, bridges and signs $5.0 million ñ Additional support to farming communities $2.0 million ñ Community recognition $0.4 million. (DSE, 2003).

The estimated $115 million fire suppression cost was established by the Ministerial Taskforce on bushfire recovery. The fully valued cost of fire suppression cannot be fully recognised due to the massive local community and regional response, the multiple streams of volunteers involved in the fire fighting efforts, and unaccounted costs. In order to account for the public funding response, and the public losses due to these bushfires, an ongoing tally has been produced to demonstrate the cumulative financial impacts on Victoria and it's taxpayer's. Table 1: Total Quantifiable Public cost (2003 Bushfire) Type of cost Amount (Million$) Source Total

Fire suppression 115 MTOBR

Recovery 83.3 “

Financing support for concessional loans

3 “

Public Infrastructure 83 Stephenson, C, (2010a)

Park buildings, contents and infrastructure

34.7 Stephenson, C, (2010a)

Environmental losses 1095 Stephenson, C, (2010a) 1414 Stephenson (2010a) figures in 2008 ($).


Some estimates are not normalised and if not listed, costs have ($) value at time of valuation. Private Costs of the 2003 Eastern Victorian Fires. Along with various fire suppression efforts, recovery initiatives and environmental losses, Victorian's also constantly face the impact of private financial losses brought about by natural disasters such as fires. These types of costs do not affect the Victorian taxpayer but impact Victorians on a private level, often without insurance and few mechanisms for successful rehabilitation. These include such losses as; residential infrastructure, local economic activity loss and agricultural loss. Once again the true private losses due to the disaster cannot be truly valued as it is difficult to account for individual loss.

Image: Bush Fire Memorial inauguration. The Gangemi et al. (2003) study focussed on assessing the significant social and economic costs of the 2003 bushfires across the Gippsland and North East Regions for both the short and medium terms. The study revealed that the

bushfires are expected to have considerable direct and indirect effects on these regions for the long term (i.e. the next two to five years after the event). In total, the study estimated that the loss of income and production in the Shires of Alpine, East Gippsland, Indigo and Towong from the time of the fires to May 2003 to be $121.1 million. Insurance data was taken form the ICA, where estimates of insurance costs are normalised to 2011($). The insured losses from the Victorian alpine fires of 2003 are estimated at $24 million. Residential loss is often difficult to estimate and various sources can often provide very different amounts. Kanowski, Whelan & Ellis, (2005) state that in the 2002-‐2003 fire season, ten people lost their lives; city suburbs, rural towns, farms, plantation forests and infrastructure were damaged; property losses exceeded


$400 million; and there were significant environmental impacts. Other sources valuation of property loss are much more conservative. Other minor private losses have also been accounted for. In the Alpine Shire, Gangemi et al. (2003) noted that smoke taint from the 2003 Alpine Fires rendered grapes useless. This cost wine-‐growers between $10,000 and $1 million dollars each, with a combined estimated loss ranging from $5 to 8 million. Table 2: Total Quantifiable Private Cost (2003 Bushfire)

Type of cost Amount (million$) Source Total ($)

Local economic loss 121.1 Gangemi et al. (2003)

Insurance 24 ICA (2013)

Residential buildings and contents

8**3 different sources all value differently from 8-‐400

Stephenson, C, (2010a). Kanowski, Whelan & Ellis, (2005)= 400

Commercial and industrial buildings and contents

2.6 Stephenson, C, (2010a)

Grape production loss

5 Gangemi et al. (2003)

Agricultural loss 61 Stephenson, C, (2010a)

Timber 1392 Stephenson, C, (2010a)

Social: Fatalities 3.7 Stephenson, C, (2010a)

2009.4

Stephenson (2010a) figures in 2008 ($). ICA, cost normalised to 2011($) An After Thought. These fires were the largest fire events in the state for a decade and highlighted many issues, some of which became even clearer after the Black Saturday fires. Commentators report that a number of issues were present in the lead up and during the disaster event. Hodgson (2006) states that during the 2003 Alpine fires the media reported a chorus of allegations including negligence associated with land management


practices particularly access and hazard reduction in parks and State forests, a tardy initial response to some fires, and sidelining of experienced local volunteers and their equipment during the firefight. Inadequate fire mitigation and the effect on local economies seems to be a common concern throughout examples of Victorian bush fire disasters. We note that there are some interest groups who want to see national parks and other conservation reserves opened up to commercial activity, and debate about fire access can provide cover for this type of argument. Striking a balance between maintaining a representative conservation estate managed primarily for the conservation of biodiversity and landscapes and the need to protect human assets around these reserves is still an issue that is yet to be resolved. The recent (December 2013) major tree clearing occurring within the Alpine national park along the Great Alpine Road between Harrietville and Mt Hotham is a case in point. A decision to remove fire killed trees in a belt along this road up to 40 metres back from the road was primarily taken by road managers. This, in effect, will create a significant barrier to movement of arboreal mammals and possibly others – forcing them to move across the road and increasing the likelihood of being struck by road traffic. Will Parks Victoria have the funds to monitor this situation and carry out remediation works to ensure regrowth? At what point does the imperative to protect assets over ride the equally compelling need to maintain retain relatively continuous natural ecosystems within reserves? There is, of course, an underlying social issue that will disproportionately impact low income areas around fire zones. Local areas within the Omeo region were heavily impacted by these fires and towns in the area are often found to be low income areas. In Omeo (Suburb), the median weekly individual income for persons aged 15 years and over who were usual residents was $420, compared with $466 in Australia. The median weekly household income was $715, compared with $1,027 in Australia. The median weekly family income was $883, compared with $1,171 in Australia (ABS, 2013). The Garnaut Climate Change Review (2009) notes that an increase in the severity of droughts is likely to increase the financial pressures on farm households and may exacerbate existing problems such as underinsurance. There is also a risk that there will be successive droughts and bushfires in relatively short periods of time which may exceed residents’ capacity to cope and recover. 2005 – 2006 Victorian 'Grampian' Bushfires. Across Victoria more than 500 fires broke out between New Year’s Eve and the end of January 2006. The fires with greatest impact on the Victorian community occurred in the Stawell (Deep Lead), Yea, Moondarra, Grampians, Kinglake and Anakie areas. There were four fatalities in these fires. Fifty seven houses were destroyed and 359 farm buildings lost. Stock losses totalled more than 64,000. These fires burnt around 160,000 hectares. Approximately 60% of this area was public land and 40% private property (Ministerial Taskforce on Bushfire Recovery, 2006). One of the more extreme fire events in this season was located in and around the Grampians national park, affected both public and private land.


On Thursday 19 January 2006 lightning started four fires in the Grampians National Park. The Mt Lubra fire was located by DSE mid-‐morning on Friday 20 January by a reconnaissance aircraft. The fire was not controlled (Hodgson, 2006, p11). Some sources have claimed that the fire has been given a greater amount of fuel source as outlined back burning by government agencies had not been completely fulfilled. In the 10 hours between 2pm and midnight on Sunday 22 January it burnt about 80,000 ha of National Park and adjoining private property. During that time two people died, 26 houses, 22 woolsheds, 2,600 beehives, 1,500 km of fencing, more than 60,000 farm animals and very significant quantities hay and pasture were destroyed. The numbers of native mammals and birds that died can only be guessed (Hodgson, 2006, p11).

Image: Grampians National Park, Victoria; one year after the big fire. Recovery Effort. The Ministerial Taskforce on Bushfire Recovery released it's 2006 report outlining how the Victorian government would respond to the bushfire events. The report outlined the types of assistance available to affected communities and the ecosystems which received damage. The Victorian Government decided not to hold an inquiry into the fire and the Coroner has not responded to a request to inquire into the deaths of two people who

died in the fire. Confusion about the amount of fuel reduction burning done on public land continued. The Government failed again to meet its own burning target and made no provision in the Budget to make up the backlog of areas that it said required fuel reduction (Hodgson, 2006, p11). The Ministerial Taskforce on Bushfire Recovery Report (2006) outlined their assistance program detailing the response package: BUSHFIRE RECOVERY ASSISTANCE SUMMARY

ñ RDV Recovery assistance package $500,000 ñ RDV Business Planning Recovery Program $100,000 ñ 10 Small Town Development Fund projects $1.43 million ñ New emergency services rescue and protective equipment $1 million ñ Fodder Transport Grant to VFF $125,000 ñ DHS funding for recovery co-‐ordination and management to local governments

$255,000


ñ DHS funding to community health services and agencies for counselling and case management $60,000

ñ Neighbourhood House Grants to Kinglake and Anakie $6,000 ñ Fire mapping for the State $270,000 ñ Restoring assets in national parks $450,000 ñ Recovery of catchment and water protection $45,000 ñ Cultural Values Assessment and Protection $75,000 ñ Extension of summer fire crews for two months $1.4 million ñ Twenty-‐four small regional community and tourism projects $135,000 ñ Additional support to rural land managers $3 million ñ Community development package $300,000 ñ Marketing and industry development activities for tourism $1.65 million

TOTAL $10.8 million Table 3: Total Quantifiable Public Cost (2006 'Grampian' Bushfire) Type of Cost Amount (Million $) Source Total

Recovery assistance 10.8 Ministerial Taskforce on Bushfire Recovery, (2006)


11 Stephenson (2010a)

Emergency Response Operations

36.5 Stephenson (2010a)

Environmental losses

315.1 Stephenson (2010a) 373.4

* Stephenson (2010a) figures in 2008 ($).

Private Costs of the 2005-‐2006 Victorian 'Grampian' Bushfire. Bushfire disasters can severely test the ability of local economies to continue to trade and be resilient to the effects the fire can leave behind. Nearly 60% of the region’s businesses derive income from tourism associated with the Grampians national park. The capacity to bounce back after the bushfires will be tested for many businesses, with 61% of respondents indicating difficulty in being readily able to finance future business growth, and the Wimmera Development Corporation estimating that tourism downturn resulting from bushfire devastation will cost the Grampians regional economy up to $100 million (Ministerial Taskforce on Bushfire Recovery, 2006, p6).


Estimates on agricultural losses are that approximately 62,000 hectares of farming land owned by 603 property owners/lessees were burnt. Assets lost included 57 houses, more than 350 other buildings and over 64,000 head of livestock (63,243 head of sheep, 557 head of cattle and 464 other stock) (Ministerial Taskforce on Bushfire Recovery, 2006, p6). Insurance data was taken from the ICA, where estimates of insurance costs are normalised to 2011($). The insured losses from the fire are estimated at $28 million. Table 4: Total Quantifiable Private Loss (2006 'Grampian' Bushfire) Type of Cost Amount (million $) Source Total ($)

Local economic loss 100 Ministerial Taskforce on Bushfire Recovery, (2006)

Insurance 28 ICA (2013)



Agriculture 62.5 Stephenson (2010a)

Social: Fatalities 7.3 Stephenson (2010a) $212,300


2006 – 2007 Great Divide Fires. These fires occurred towards the end of the decade long drought in south eastern Australia, when many landscapes were very dry. Fire agencies responded to more than 1,000 fires across Victoria from mid-‐December 2006 to mid-‐March 2007. The total area burnt by these fires on public and private land exceeding 1,200,000 hectares. The two most serious fires occurred in the north east (the ‘Great Divide North’ fire) and Gippsland (the ‘Great Divide South’ fire) DEPI, 2013). The 2006/07 great divide fire ran for 69 days and burnt over 1 million hectares. Suppression of this fire cost $170 million on top of regular budget allocations. Additional sums were made available for recovery (DSE & CFA, 2008, p6). The fires spread across such a large section of the state that much of the states natural resources were threatened by the disaster. These fires were eventually contained in mid February 2007 after burning for 59 days. The Great Divide North and South fires burned a total of 1,048,238 hectares, almost entirely on public land. Other significant fires burning at the same time as the Great Divide fires were the Tawonga Gap fire (33,590 hectares) and the Tatong-‐Watchbox Creek Track fire (31,810 hectares). There was one fatality, fifty one houses were destroyed and 1,741 stock lost as a result of these fires (DEPI, 2013). The Thompson catchment provides up to 60% of Melbourne’s water supply and was directly threatened during the 2006/07 great divide fires. Younger forests absorb more of the available water. It is estimated that damage to forests in this catchment would


decrease water yields by over 30% for at least 30 years, requiring over 100 years to recover. Water quality will also be impacted (DSE & CFA, 2008, P2). Such impact on natural resources would significantly add to the states burden of disaster recovery. At the peak of this summer's Great Divide fires, more than 4300 firefighters, 600 tankers, 180 bulldozers and 60 aircraft were involved. The cost:

ñ 1008 fires on public land ñ 4700 bush, scrub and grassfires attended by CFA ñ 2.5 million hours worked to battle the blazes ñ $170-‐180 million cost to fight bushfires ñ 1.1 million hectares of public land burnt ñ 2100 hectares of pine plantations burnt ñ 19,000 firefighters from CFA, DSE, interstate and overseas deployed for Great

Divide Fires ñ 51 houses lost ñ 221 sheds lost ñ 1858 kilometres of fencing burnt ñ 1000 hectares of field crops lost ñ $5 million losses to East Gippsland Shire business because of tourism

cancellations ñ 11 days of poor air quality in Melbourne and Geelong during bushfire season ñ $18 million estimated loss in tourism revenue in Wellington Shire alone this year

because of bushfires ñ 403 sheep killed ñ $2.5-‐$4 million cost to secure water supply for East Gippsland residents impacted

by fire ñ 35,000 small bales of hay lost ñ 965 cows killed ñ 18,000 hectares of pasture lost ñ 1 man died after being run over by a fire tanker while fighting a deliberately lit

fire at Coopers Creek. (Guerrera, 2007) Recovery Effort. The 2007 Ministerial Task-‐force Report on Bushfire Recovery outlined a $138 million (backed up by table) response and recovery package and set out both immediate and long term actions to help fire affected communities and rebuild their lives. This report committed $31.06 million of funding support to recovery costs on public land. Initiatives (being a total of $31.06 million) announced in this report include:

ñ restoring visitor services-‐ $12.4 million ñ restoring natural values, including catchment and river health-‐ $10.59 million ñ Restoring forest values-‐ $5.8 million ñ Indigenous and post-‐settlement cultural heritage-‐ $ 1.01 million-‐flood


ñ Fire severity mapping and assessment-‐ $1.265 million. DSE & Parks Victoria, (2008). Table 5: Total Quantifiable Public Loss (2007 Great Divide Fires) Type of Cost Amount (Million $) Source Total ($)

Fire suppression cost

170 DSE & CFA, (2008)

Response and recovery package (including Great divide recovery plan of 31.06)

138 DSE & Parks Victoria, (2008)



Environmental losses

1095.6 Stephenson (2010a) 1432.2

* Stephenson (2010a) figures in 2008 ($). Private Cost of the 2006-‐ 2007 Great Divide Fires. The economic losses that communities faced were not only severe but widespread due to the dispersed nature of this fire season. During the 2006/07 great divide fires, smoke from the Tatong Fire shorted major high voltage power lines resulting in loss of power and a “brown out” in Melbourne and across much of Victoria. The estimated economic impact / loss of this one day event was put at $500 million (DSE & CFA, 2008, p2). The estimated ‘unserved energy’ was 7,100 MWh. Direct impacts totalled $235 million. Substantial indirect impacts and on-‐flow costs (approx. $265 million) were additional to this (The Nous Group, 2007). Then, during the process of recovery, the 2006–07 Great Divide Fires brought about more disruption to tourism businesses, resulting in an estimated loss of $200 million for the 12 months following the start of the fire (Ministerial Taskforce on Bushfire Recovery, 2007). Bushfires and planned burning impact significantly on air quality in Victoria. Air quality during the 2006/07 bushfires was some of the worst on record in the state: •Visibility was reduced to 0.4km in Wangaratta and 1.2 km in Melbourne compared to an optimum of 20 km; and •Particle levels were in the order of five times the optimum (DSE & CFA, 2008, p11). The smoke produced from burning also had effects on the local wine industry and it's produce. Whiting and Krstic (2007) noted that the value of smoke-‐tainted grapes in north-‐eastern Victoria was estimated at $15–20 million, which amounted to a $75–90 million loss in wine sales.


The recent study by Dennekamp & Abramson (2011) titled 'The effects of bushfire smoke on respiratory health', discusses the dangers of bushfire smoke. The air pollutant that increases most significantly as a result of bushfire smoke is particulate matter (PM). During bushfire smoke episodes, PM concentrations are usually much higher than urban background concentrations at which effects on respiratory health have been observed. The association between respiratory morbidity and exposure to bushfire smoke is consistent with the associations found with urban air pollution.

The city of Melbourne, swathed in smoke during the 2006-‐2007 bushfire season. The insurance payout from the disaster (from the table, 2009 $) is believed to have been $31 million. The ICA has not provided insurance estimate data on this disaster event.

Table 6: Total Quantifiable Private Loss (2007 Great Divide Fires) Type of Cost Amount (million $) Source Total ($)

Economic loss from Brown-‐out

500 The Nous Group (2007)

Local economic loss 200 Stephenson (2010)

Insurance 30 Stephenson (2010a)



Agriculture 165.5 Stephenson (2010a)

Timber 692.4 Stephenson (2010a)

Social: Fatalities 3.7 Stephenson (2010a)

Wine industry loss 75 Whiting and Krstic (2007) 1680.1


* Insurance data not from ICA and in 2009 ($).


2009 ‘Black Saturday’ fires. The 2009 bush fires occurred during extreme bushfire-‐weather conditions and resulted in Australia's highest ever loss of life from a bushfire. As many as 400 individual fires were recorded on 7 February. Following the events of 7 February 2009 and its aftermath, that day has become widely referred to as Black Saturday. A member of the Newham Rural Fire Brigade attending the 7 February 2009 Black Saturday fires at Kilmore East, Victoria. Costs attributable to the fires. Fencing was often not insured. In November 2009 the Victorian Bushfire Reconstruction and Recovery Authority estimated that the Victorian Farmers Federation volunteer program had coordinated 14,740 volunteer-‐days to repair damaged fences (VBRRA, 2010). The RSPCA estimates that more than 1 million animals died in the fires. The RSPCA Bushfire Appeal raised over $4.1 million to support its emergency relief efforts (RSPCA Victoria, 2010). Stock losses are estimated at more than

11,800, including more than 4,500 sheep, 4,000 cattle and 200 horses. Three per cent of the Yarra Valley’s vineyard area was burnt; the cost of smoke taint is also hard to value because accurate estimates are difficult to obtain. Among other output losses was the destruction of trout farms: some 220 tonnes of trout were lost (VBRRA, 2010). The Department of Sustainability and Environment’s preliminary modelling shows that the carbon dioxide emissions from the January–February bushfires on public land were in excess of 8.5 million tonnes (Victorian Bushfires Royal Commission, 2009).

VicForests reported that the fires severely burnt about 10,000 hectares of the mountain ash forest available for timber harvesting—that is, about 10 per cent of the ash resource in the central highlands area. The Victorian Association of Forest Industries reported that VicForests conservatively estimated the ‘mill door’ value of the standing timber burnt at approximately $600 million (Victorian Association of Forest Industries, 2009). Fires in catchment areas have both immediate and long-‐term impacts on water supply, and about one-‐third of Melbourne’s water catchments were burnt. Melbourne Water has estimated that the Black Saturday bush fires caused $5 million of damage to Melbourne Water’s natural and built assets (Reynolds, 2009, p13).


Recovery Effort. By October 2009 the Victorian Bushfire Reconstruction and Recovery Authority had spent $867 million, and it foreshadowed further expenditure of $193 million. VBRRA was a channel for Commonwealth and Victorian funds and also administered expenditure from donations (VBRRA, 2009). The Commonwealth provided more than $465 million and other resources through various agencies to immediately respond to the bush fires and assist with the recovery effort in affected communities (Commonwealth of Australia, 2010). The Victorian Budget for 2009–10 provided for approximately $269 million for rehabilitation and recovery projects, including establishing VBRRA, funding case managers to support people affected by the fires, providing tourism and business support packages, and resourcing a clean-‐up and demolition program (Victorian Bushfires Royal Commission, 2009). The State budgeted $40 million to fund the 2009 Victorian Bushfires Royal Commission. This figure does not, however, capture the significant additional costs incurred by individuals and organisations in preparing submissions and otherwise responding to the Commission (Victorian Bushfires Royal Commission, 2009). The Red Cross Victorian Bushfire Appeal 2009, launched in partnership with the Victorian and Australian Governments, received an unprecedented $379 million in donations, the largest single charitable appeal in Australia’s history (Victorian Bushfire Appeal Fund, 2010). Table 7: Total Quantifiable Public Loss (2009 bush fires) Type of Cost Amount (mil$) Source Total ($)

Fire Suppression Cost 593 Department of Treasury and Finance, (2009)-‐Green Paper.

Relief and Recovery cost minus private donations

1081-‐379 =702

Victorian Bushfires Royal Commission, (2009), and Victorian Bushfire Appeal Fund, (2010)

2009 Victorian Bushfires Royal Commission

90 Victorian Bushfires Royal Commission, (2009)

Environmental losses 359 Stephenson (2010a)



Public infrastructure 6.9 Stephenson (2010a) 1784.3 * Stephenson (2010a) figures in 2008 ($).

* The Commonwealth estimates their Total contribution (as at 30 April 2010) $465.371 million (Commonwealth of Australia).


* Not estimated was the value of CFA and other volunteer time plus additional costs incurred by the MFB, ADF, Victoria Police, SES, State Coroner’s Office, NEO and DSE as a result of the fires.

Private Costs of the 2009 Bushfires. A detailed calculation contained in the Royal Commission shows that the biggest financial expense from the fires has been insurance claims paid out, which the Insurance Council of Australia said totalled about $1.2 billion. Of these 84 per cent are property or contents claims, the remaining 16 per cent are motor vehicle claims (Gray, 2010).

The Victorian Bushfires Royal Commission (2009) applied the method of valuing life accepted by Commonwealth and Victorian government agencies for a variety of purposes to the 173 lives lost in the bushfires. That approach values those lives at $645 million. Along with the fatalities, the fires caused many injuries that were not valued, as the Commission was unable to make an accurate assessment of the costs of injuries sustained during the fires. Telstra has spent $15 million restoring and upgrading communications infrastructure destroyed or damaged by the February bushfires. It also waived service charges to affected customers and provided equipment and services to members of the public as part of the relief effort. Telstra estimates its total bushfire-‐related costs at almost $20 million (Victorian Bushfires Royal Commission 2009).

Table 8: Total Quantifiable Private loss (2009 bushfires) Type of Cost Amount (mil$) Source Total ($)

Insurance 1266 Insurance Council of Australia

Donations 379 Victorian Bushfire Appeal Fund, (2010)

Fatalities 645 Victorian Bushfires Royal Commission, (2009)

Injuries 70 Stephenson (2010a)



Agriculture 720 Stephenson (2010a)

Asset damage and other costs incurred by Telstra and Melbourne Water. (Long-‐term impact on water supply was not estimated.)

25 Victorian Bushfires Royal Commission, (2009)

Timber 658* 79^-‐ this was used

* Victorian Bushfires Royal Commission, (2009) ^ Stephenson (2010a)


Commercial and industrial buildings and contents

37 Stephenson (2010a) 3832.8

* Stephenson (2010a) figures in 2008 ($). * No estimation given of costs of the vast number of injuries sustained in the fires. * Timber not valued at mill door value but through Stephenson (2010a). * Local economic loss has not been valued. An After Thought. After the 2009 bush fire events several Australian commentators shared their thoughts in regards to the operations and the future risk of bush fire events like the one just seen by south eastern Australia. Flannery (2009) stated that we must anticipate more such terrible blazes in future, as the world's addiction to burning fossil fuels goes on unabated, with 10 billion tonnes of carbon being released last year alone. He states that there is now no doubt that greenhouse pollution is laying the preconditions necessary for more such blazes. Along with Flannery (2009), Marshall (2009) has similar concerns about climate change inaction, stating that firefighters know that it is better to prevent an emergency than to have to rescue people from it, and we urge state and federal governments to follow scientific advice and play it’s role in the global efforts to reduce greenhouse gas emissions. Locally this means keeping firefighters and the community safe by halving the country's greenhouse gas emissions by 2020. Research published in 2007 by the Australian government's own Commonwealth Scientific and Industrial Research Organisation reported that by 2020, there could be up to 65% more "extreme" fire-‐danger days compared with 1990, and that by 2050, under the most severe warming scenarios, there could be a 300% increase in such days (Walsh, 2009). Then leader of the Australian Green Party Bob Brown told Sky News that "[The fires] are a sobering reminder of the need for this nation and the whole world to act and put at a priority the need to tackle climate change”. Fire summary and climate change. The fire events over the last decade have impacted on the state of Victoria in numerous ways and have highlighted the factors that contribute to more severe blazes. It is interesting to note firstly that the Indian Ocean Dipole (IOD) which is an irregular oscillation of sea-‐surface temperatures in which the western Indian Ocean becomes alternately warmer and then colder than the eastern part of the ocean, causes drier conditions. While long term natural variation is also an issue to consider, it is apparent that climate change will cause longer and more severe fire seasons. Walsh (2009) states that Australia has warmed 0.9°C since 1950, and climate models predict the country could warm further by 2070, up to 5°C over 1990 temperatures, if global greenhouse-‐gas emissions go unchecked. The Garnaut Climate Change Review (2009), mentions that the risk of bush fires in East Gippsland is also predicted to increase with climate change. In the Gippsland town of Sale, there are currently around 8 days per year when the Forest Fire Danger Index (FFDI) is very high or extreme; this could rise to 10 days by 2020 and 14 days by 2050.


Other commentators fear that Victorians are actually less prepared and equipped to combat fire events than in the past. Hodgson (2006) believes that the Government Inquiry into the fires and its Report were seriously flawed. “They failed to link deficiencies in preparedness and firefighting with reduced resources, public land management practices and the way Government agencies go about their business. After the fires, the Government and the Department of Sustainability and Environment (DSE) downgraded Victoria’s ability to respond to forest fires even further” (Hodgson, 2006, p1). Similarities in calls from commentators emerge over the years studied, with a common call for greater pre-‐fire mitigation so suppression and recovery efforts are not overwhelmed and to reduce public and private losses.

Floods According to the Victorian government, “generally in Victoria major regional floods occur about every 5 to 10 years. Larger floods are less frequent, but it is not unknown for more than one major flood to occur in a catchment in successive years”. The management of floods and floodplains brings together the resources of various agencies, authorities, municipal councils, emergency services and the flood affected community to take appropriate and timely action in relation to flood prevention, response and recovery (DEPI, 2013). While it is difficult to attribute a specific weather event to a changing climate, the recent flooding events around Victoria are a reminder to what scientists have been suggesting in the last decade. That along with rising global temperatures and rising sea levels comes a greater frequency of extreme weather events such as fires, droughts, heatwaves and severe storms. From September 2010 to February 2011 and during March 2012, Victoria experienced some of the worst floods in the state’s history. Approximately one-‐third of Victoria, including 70 local government areas, experienced some form of flooding or storm damage, resulting in enormous cost and disruption to regional, urban and rural communities. As at October 2011, the estimated total cost of these floods is nearly $1.3 billion (DEPI, 2013a). The damage caused by flood events in Victoria and Australia is also exacerbated by a lack of flood mitigation techniques, lack of planning and continuing inaction. In fact, a Productivity Commission Report shows annual federal government spending on disaster mitigation has fallen to just $26 million dollars in 2010-‐11. There was no additional money for flood mitigation in the 2012 federal budget (Fanning, 2012).


Fanning (2012) discusses the lack of QLD flood mitigation measures, stating “it’s staggering to realise that — as a result of this detailed mapping — the insurance companies have a far better idea which properties face the danger of flooding than the occupants do”. Built very close to the coast or in flood zones along waterways, none of these towns has enough flood mitigation – that is, levees or dams – to hold back rising waters. And, by and large, local councils in such areas have not dictated strict building standards to protect home owners against the effects of the almost inevitable floods. You might conclude some of these houses should never have been built at all. To subsequently order the removal of housing stock in areas likely to be affected in future is

a fraught and potentially costly exercise. Although many scientists don't want to conclude that climate change is a main driver, many hint at it's effects. "The extra water vapour (associated with climate change) fuels the monsoon and thus alters the winds and the monsoon itself and so this likely increases the rainfall further," said Trenberth, head of the Climate Analysis Section at the National Center for Atmospheric Research in Boulder, Colorado. "So it is easy to argue that 1 degree Celsius sea surface temperature anomalies gives 10 to 15 percent increase in rainfall" (Birsel, 2013).

January 2011 Floods. The Victorian floods of January 2011 were the biggest on record for catchments in the west and north-‐west of the State, and some areas recorded three to four times the January average rainfall. Flooding affected 75 towns, thousands of people and their properties. More than 3,000 Victorians were evacuated from their homes as flood waters continued to rise across the state (DEPI, 2013a). The flooding event came off the back of a 14 year drought. At the time of the flood, over 400 towns were on water restrictions and nearly 100 towns across northern Victoria were on stage three or four water restrictions. The drought also had significant impacts on the availability of water for irrigation (Comrie, 2011) and environmental flows necessary to maintain the health of rivers. Not only were significantly dry conditions setting the scene but the floods were fuelled by a La Nina event that was one of the strongest recorded. Ocean temperatures around Australia were near record high levels, and there were more frequent low pressure systems over Australia and more humid conditions than usual. La Niña periods are usually associated with above normal rainfall during the


second half of the year across large parts of Australia and this was certainly the Victorian experience (Comrie, 2011). The spatial impact was dramatic, calling on much of the emergency services to support local communities that were the hardest hit. Approximately one-‐third of Victoria, including 70 local government areas, experienced some form of flooding or storm damage, resulting in enormous cost and disruption to regional, urban and rural communities (Comrie, 2011). The impacts of flooding events are ongoing and the recovery efforts are strained by the damage to infrastructure, and the lingering effects of inundation halting a swift response. Along with the substantial impact to residential property and townships, significant loss, damage and isolation to rural properties and farms was experienced. Widespread horticultural damage and loss, crop disease, soil movement and erosion, stranded and lost livestock and fodder loss occurred Comrie, 2011). Recovery effort. The severe impact of the flooding event in Victoria led to the initiation by the State government of a comprehensive review of flood warnings and emergency response efforts. The Review of the 2010-‐11 Flood Warning and Response was initiated on 8 February 2011 by the Premier following severe flooding across Victoria in the previous 18 months. Led by Mr Neil Comrie AO, APM, former Chief Commissioner of Victoria Police, the review described the impacts felt, and reviewed the emergency response. The Victorian Government has released a plan in response to the Review of the 2010-‐11 Flood Warning and Response (DEPI, 2013a). The plan committed to a continual review and improvement process through revising the Victorian Flood Management Strategy and the Regional Flood Management Strategy and building capacity and skills in flood intelligence. Key actions include: ñdeveloping a web-‐based information system to provide quality information to emergency services and communities about flood risk; ñconducting up to 25 flood risk studies in flood prone communities; ñupgrading flood warning systems; ñimproving real-‐time data collection and delivery systems; and ñlong-‐term framework to allow communities to periodically review their flood warning requirements.

The Government has already provided $25 million over four years for improvements to flood warning systems and response. Some of these actions have started. The Government will review the progress to ensure all actions are completed (DEPI, 2013a). The plan also stressed the importance of continual commonwealth funding to support ongoing upgrades of flood warning and mitigation systems. The Victorian Auditor General (2013) 'Flood Relief and Recovery' report details the government's recovery funding for the 2010-‐2011 floods.


Figure 1A: Allocation of flood relief and recovery funding (Victorian Auditor General, 2013, p2). NDRRA Funding Category

Description Funding ($ mil)

A Emergency assistance given to individuals to alleviate personal hardship or distress

35

B Restoration or replacement of essential public assets 778

C Community recovery package to support communities, small businesses and primary producers

86

D Exceptional circumstances as determined by the state and Commonwealth governments

1

State Funded

Relief and recovery of communities and local economies to increase community resilience in future disasters

71

Total 971 As at 31 January 2013, the total cost estimate for relief and recovery was $971 million. Under the provisions of the Natural Disaster Relief and Recovery Arrangements (NDRRA), the state shares costs with the Commonwealth. Following the floods the Commonwealth provided an advance payment under NDRRA of $500 million to Victoria (Victorian Auditor General, 2013, p vii). Another initiative; The Victorian Business Flood Recovery Fund (VBFRF) is a $10 million Victorian Government initiative which aims to restore and improve the capacity of areas of regional Victoria affected by the 2011 floods and enhance their economic development by encouraging private sector investment and job creation (Regional Development Victoria, 2013). Table 9: Total Quantifiable Public loss (2011 Floods) Type of Cost Amount (mil $) Source Total ($)

NDRRA Flood relief and recovery funding

971 Victorian Auditor General, (2013)

State-‐controlled (arterial) roads damaged

133 Comrie, (2011)

Railway bridges damaged 4

Comrie, (2011)

Railway track damaged (washaways)

10

Comrie, (2011)


Wilsons Promontory NP roads damaged*

3

Comrie, (2011)

Community facilities (Freehold land, Council owned & operated asset) damaged

162 Comrie, (2011)

Public land bridges damaged 4.8 Comrie, (2011)

Public land roads damaged (V numbers)

18.2 Comrie, (2011)

Local-‐controlled bridges damaged

1.3

Comrie, (2011)

Local-‐controlled roads damaged 116.8

Comrie, (2011) 1424.1

*Commonwealth provided an advance payment under NDRRA of $500 million to Victoria (Victorian Auditor General, 2013, p vii). *Impacts that have not been given a monetary value include: Environmental losses/ecosystem services. January 2011 floods private costs. The Insurance Council of Australia reported that a total of 56,791 claims have been made to insurance companies (49,000 metropolitan and 7791 rural/regional) to the value of $836.1 million ($662.6 million metropolitan and $173.5 million rural/ regional) – this includes vehicles, property, domestic, commercial and business interruption. Each Victorian department has disaster insurance, and, as at 31 January 2013, approximately $70 million has been reimbursed from insurance claims for the restoration or replacement of essential public assets. Table 10: Total Quantifiable Private loss (2011 Floods)

Type of Cost Amount (million $) Source Total ($)

Insurance 836.1 ICA

Agriculture 269 Comrie, (2011a)

Tourism revenue loss

176 Comrie, (2011a)

Horticulture – Other horticulture (loss value)

5.1 Comrie, (2011)

Schools affected 10.4 Comrie, (2011) 1296.6 *Impacts that have not been given a monetary value include: Residential and property loss, Commercial and industrial buildings, fatalities.


March 2012 Floods. Early 2012 saw another major flood event in Victoria. Heavy rainfall started on the evening of February 27, 2012 and continued for two days, leading to totals exceeding 250 millimetres in the Broken Creek system in northern Victoria. Overland flooding occurred from direct rainfall in places such as Yarrawonga, Cobram, Tallygaroopna, Congupna and Katandra West. Riverine flooding was also significant and widespread along the Broken Creek system (Environment and Natural Resources Committee, 2012). Hydrologists indicated the rain had exceeded 1993 levels, and approached the 1-‐in-‐100 year flood event record in the area north of Shepparton including Numurkah (VICSES, 2012). The flood lasted around three weeks from when rainfall began to when the floodwaters found their way to the Barmah forest and the Murray River. The impacts of the flood were significant. The flood saw a large multi-‐agency response with the VICSES being supported by VICPOL and significant numbers of CFA and DSE crews (VICSES, 2012). In evidence provided by the Goulburn CMA at the Numurkah public hearing, a rapid assessment showed a total of around 140 habitable buildings were impacted, including close to 100 in the worst affected town of Numurkah. In each of the floods of 2010, 2011 and 2012 it was a matter of fortune that during these events the Murray River itself was experiencing relatively low flow rates (Environment and Natural Resources Committee, 2012). Recovery Effort. The Department of Human Services 'Victorian Government flood recovery initiatives in detail' document outlines the recovery initiatives that were implemented after the flooding event and are listed below. DHS, (2012a):

Recovery initiative Amount (Mil $)

Flood Recovery Support Package 1.7

VFF Fodder Program 0.1

VICSES Support Victorian Floods 4.1

Flood Advisory Service N/a

Numurkah District Health Service repair and other 2012 flood related health initiatives

2

Flood Recovery – community facilities, recreation sites, and buildings on Crown land

1.6

Flood Damage Road and Bridge Reinstatement Works 0.39

Surface Water Monitoring Flood Recovery 0.15

March 2012 flood data collection and assessment 0.5

Restoring Victoria's flood damaged parks 0.89

Repairing flood damage to the state's groundwater observation bore network

0.1


Facilitating Irrigator Recovery in the Broken Basin 0.75

Mitigation of the consequences of flooding initiative 0.68

Damage to road infrastructure 11.6

2012 Flood Recovery Community Infrastructure Fund 2

Psychosocial and Community Support 0.1 Total: $26.6 Million. One of the previously launched initiatives was the Flood Support Program, including $5m to restore flood damaged catchments and improve environmental conditions for tourism businesses and irrigators in flood affected areas (DHS, 2012). Both these initiatives are in addition to the $113 million provided by the Victorian Government to councils and communities affected by the floods. This funding included advance payments to those councils experiencing financial hardship to assist with immediate needs, personal hardship assistance for eligible households, and low-‐interest loans for farmers and small businesses. Table 11: Total Quantifiable Public loss (2012 floods) Type of Cost Amount

(million $) Source Total ($)

Flood Recovery Support Package

26.6 DHS (2012a)

Flood support program 5 DHS (2012)

Original government support package

113 DHS (2012)

Roads repair and restore package

45 Premier of Victoria, (2012)

189.6

*Impacts that have not been given a monetary value include: Environmental and ecosystem services loss, and public infrastructure. 2012 Floods Private Costs. The reality of private losses during this flood event is unclear due to a lack of accounting and loss assessment. The only estimate that is considered reliable for private losses during this event is the data of insurance losses. Table 12: Total Quantifiable Private loss (2012 floods) Type of Cost Amount (million $) Source Total ($)

Insurance 135 ICA 135 *Impacts that have not been given a monetary value include: Residential and property loss, commercial and industrial buildings, local economic loss and agricultural losses.


Gippsland June 2012 Floods. Commencing 4 June 2012, up to 200 mm of rain fell in eastern Victoria, breaking daily rainfall records for June at 23 locations across the state, mainly Gippsland. Many Gippsland locations received a month's rainfall in one day. Up to 100 residents in low-‐lying parts of Traralgon evacuated their homes when the Traralgon Creek flooded, 45 homes were flooded (Australian Emergency Management Institute (AEMI), 2012). From Sunday 3 June to Sunday 10 June, VICSES received 722 Requests for Assistance (RFAs) from Gippsland. There were 33 rescue events involving persons trapped or stranded by floodwaters (OESC, 2012, p3). Early estimates of flood damage are being assessed, but damage to council infrastructure alone is expected to exceed $10 million. The Department of Human Services paid out Government grants totaling $125,000 to flood-‐affected residents (AEMI, 2012). The flooding event strained local communities as many residents believed there were inadequate warnings provided and hence many were unprepared when the flood arrived in their locality. It was widely reported that certain communities in the most affected areas believed the procedures for warning and informing them had ‘failed’ (OESC, 2012, p1). Other problems were encountered within the Yallourn mine as the Morwell River

flooded the open cut mine. The flooding disrupted coal supplies and the generator reduced it's running capacity as a result. TRUenergy says it successfully redirected the Morwell River away from the coal conveyors into a disused section of the mine (ABC News 2012), although the potential damage and contamination that could have occurred is concerning. Significant issues continue to impact on the mine site and add cost to production and environmental impacts on the Morwell River.

Recovery effort. After the event the Victorian government outlined an initiative of $240,000 for East Gippsland Shire Council, and Wellington Shire Council for the provision of Flood recovery Officers (DHS, 2012a). Other recovery efforts include funding the Sale River Heritage and Wetlands Trail, which had been largely unusable since the 2012 floods, and received a $40,000 boost from the Victorian Coalition Government (Nicholls, 2013). The Victorian Coalition Government also announced a $5 million program to restore flood damaged catchments and improve environmental conditions for tourism


businesses and irrigators in flood affected areas. Minister Peter Ryan said funding under the program would be allocated to Catchment Management Authorities (CMAs) for a range of projects in each region: ·∙ $2.7 million will go to the West Gippsland CMA to undertake a number of waterway restoration projects; ·∙ $1 million will go to flood restoration projects in the East Gippsland catchment to provide further support following flooding earlier this year; ·∙ $500,000 for flood restoration for projects in the North East catchment including revegetation activities in the Ovens River near Myrtleford; ·∙ $485,000 to the Goulburn Broken CMA to support a range of projects including Whole Farm Planning in affected irrigation areas; and ·∙ $285,000 for restoration projects in the Corangamite catchment for a range projects that focus on fencing, vegetation removal, erosion prevention and revegetation. (Nicholls, 2012). Table 11: Total Quantifiable Public loss (June 2012 Floods) Type of Cost Amount (million $) Source Total ($)

Council Infrastructure

10 Australian Emergency Management Institute, (2012)

Flood recovery officers

0.27 DHS (2012a)

Flood support program

5 Ryan (2012)

Victorian Business Flood Recovery Fund

10 Premier of Victoria, (2012)

25.27

*Impacts that have not been given a monetary value include: Environmental and ecosystem services loss, and public infrastructure. Private costs of the June 2012 floods. Data regarding the estimated residential infrastructure damage, commercial and industrial buildings, local economic loss and agricultural losses has not been accounted or estimated. These estimations are important for communicating the large losses that local communities face through these types of disaster events. Without greater accounting the private costs of flood events will go unnoticed. Floods: An After Thought. Other reports and articles attempt to estimate how floods impact Victorians on a yearly basis. The monetary estimates vary in value, but the message is clear that the burden of these events are large and in the multi-‐million dollar


values. VICSES, (2012) states that floods (including flash flooding) cost Victorians an average of $465 million annually. Flood risk has been assessed by the State Emergency Mitigation Committee as the second highest risk (after bushfire) facing the state. This includes both direct physical damage to properties and assets and indirect damage arising from disruption of normal social and economic activities. A report completed by The Bureau of Transport Economics back in 2001 stated that flooding causes more damage than any other natural hazard in Australia, with annual average damages of approximately $314 million. This would have been valued in the contemporary monetary value, but still demonstrates the ongoing burden of damaging floods. Unchanging mitigation efforts to do with floods and climate change will only add to the financial burden placed on Victoria when faced with flood disasters.

Severe Storms Severe storms can occur anywhere in Australia, and they occur more frequently than any other major natural hazard. They can impact large areas, particularly through associated flooding. A severe thunderstorm was responsible for the most costly storm event in Australia—the Sydney hailstorm of April 1999, with a total insured loss of approximately $1.7 billion (ICA 2013). Annually, severe storms cost approximately $284 million, exceeded only by the cost of floods (Geoscience Australia, 2008, p88). It remains difficult to determine the influence of climate change on severe thunderstorms, largely due to the coarse resolution of existing climate models. Authors and scientific studies have still attempted to determine the effect of a warming climate on the severity and frequency of these events. Research Meteorologists in the US found that the temperature changes brought on by global warming are significant enough to cause an increase in the occurrence of severe storms. Severe storms are those that cause flooding, have damaging winds, hail and could cause tornados. Their study revealed that by the end of this century, the number of days that favour severe storms could more than double in certain locations (Science Daily, 2009). In the Australian context, one component of the influence of climate change on severe storms, a southward movement in the mean synoptic storm path, was reported by Yin (2005). Expected changes in the intensity of these synoptic storms are less clear. Changes in the frequency of east coast low pressure systems, decaying tropical cyclones, and other synoptic storms also require investigation. Secondary impacts, such as changes to peak rainfall rates, may change under a future climate, and the magnitude of these changes also requires quantification (Geoscience Australia, 2008, p94). The consensus in the 2012 IPCC and 2013 IPCC AR5 report is that tropical storms are likely to increase in intensity and rainfall but decrease in frequency with a warming climate. The opinion was that there would be fewer storms globally with more uncertainty in individual basins; an increase in average wind speeds globally but not in all basins; more frequent intense storms; higher rainfall rates in tropical cyclones; and sea


level rise to exacerbate storm surge impacts (Cook, 2013). The uncertainty of the true influence of a changing climate on severe storms is no reason to discount a connection between the two. It only reinforces that these types of disasters will require a continual response into the future which will strain the taxpayer, private business and industry. The response and recovery to storm events involves many emergency response services like the SES and other volunteer based services. There is currently little data on the estimated cost of severe storm events; often only insurance data can inform to the true damage of these events. For the following storm events insurance data was the only reliable source found, although the value of the emergency service response would be significant in monetary terms.

December 2003 Melbourne Storm. The storm of 2-‐3 December 2003 produced intense rainfall across Melbourne and resulted in flash flooding in a number of suburbs. The damage bill from the event was reported to be approximately $124 million. The majority of damage experienced as a result of the storm was due to overland runoff (the design capacity of the storm water drainage being exceeded) rather than inundation from defined watercourses (Baker, Rasmussen, Parkyn, Catchlove & Kazazic, 2005). Insured loss: $124 million (Baker et al. 2005).

2005 Storms. An unusually intense low-‐pressure system developed over Eastern Bass Strait on 2nd February 2005. After a spell of warm days with a north to north easterly airflow over much of eastern Australia, the region suffered the effects of one of the most intense summer time weather systems on record. Southern NSW, South Australia and Tasmania also received substantial rainfall during this event, however the highest rainfalls were concentrated in Victoria. The event made February 2005, Victoria's wettest February since 1973 and the 7th wettest in the last 106 years. The system brought abnormally low temperatures and severe storms with gale and storm force winds to most parts of the region. However, the continuous rainfall for about 30 hours was perhaps the most significant feature produced by the low-‐pressure system. The rainfall resulted in widespread flooding, particularly over Central Victoria and West and South Gippsland (BOM, 2013). Insured loss: 304 million (ICA, 2013).


2007 Gippsland severe storm. In the last week of June 2007, Gippsland received record rainfall associated with an intense low pressure system. The storm followed one of the state’s worst fire seasons, the 2006/07 Great Divide Bushfires, when 1.2 million hectares were burnt and vast areas of soil were exposed. Further compounded by other minor floods in March and November 2007, the storm in June 2007 resulted in major flooding and widespread damage to community and public assets in Gippsland. In response, the State Government quickly established a Flood Recovery Ministerial Taskforce, which visited Gippsland to assess the flood’s impact and plan the recovery program. From this, the Taskforce outlined a $60 million Flood Recovery Initiative. The State Government’s Flood Recovery Ministerial Taskforce outlined a $60 million response and recovery package and set out both immediate and long term actions to help flood affected communities rebuild their lives (Flood Recovery Ministerial Taskforce, 2010). Insured loss: 18 million (ICA, 2013). 2010 Melbourne Storm. According to the Insurance Australia Group (2011), Melbourne experienced its worst hailstorm in 156 years of weather records during Saturday afternoon on March 6, 2010. The SES received more than 4,000 calls for assistance, and more than 100,000 homes lost power (Thom, 2010). The thunderstorm complex formed over the northwest of the state early in the afternoon and became severe as it tracked over high ground approximately 100 km northwest of the city. During the initial intense phase the first cell tracked over the rural town of Melton, located around 30km to the west of Melbourne, dropping 4 cm diameter hail on the region before collapsing over the western suburbs of the city (Insurance Australia Group, 2011, p1).

Industry wide insurance claims for damage associated with this event, the most expensive natural disaster to affect Melbourne, totalled $AUD 1,044 million ($USD 1 billion) but this figure excludes damage to public infrastructure, community disruption and uninsured or uninsurable property. Fortunately no one was killed during this event and reported injuries were relatively minor (Insurance Australia Group, 2011). Insured loss: 1044 million (ICA, 2013).


2011 Victorian Severe Storms (linked to Cyclone Yasi). On 4 February 2011, severe thunderstorms developed over Victoria. Tropical moisture associated with Tropical Cyclone Anthony and ex Tropical Cyclone Yasi interacted with a persistent low pressure trough extending from central Australia, through Mildura and Melbourne, to north-‐eastern Tasmania. Extremely high humidity and strong winds were associated with the storms which delivered record daily and multi-‐day rainfall totals to areas of north-‐east and south-‐east Victoria. The rain caused flash flooding in metropolitan Melbourne and prompted flood warnings for 24 rivers and creeks (Australian Emergency Management, 2013). Hail stones the size of golf balls fell on Leopold near Geelong, and half a dozen factories were damaged in Strezlecki Grove, Laverton, when 132km/h winds roared through the suburb (Ferguson, & Barry, 2011). Insured loss: 488 million (ICA, 2013). 2011 Victorian Christmas Day Storm. Thousands of homes were damaged when thunderstorms swept across Melbourne, bringing flash flooding and hailstones the size of cricket balls. The northern Melbourne suburbs of Eltham, Broadmeadows and Keilor were among the worst hit. The SES was swamped by more than 4,000 calls for help and more than 50 volunteers arrived from interstate yesterday to help repair damaged homes (ABC News, 2011). Insured loss: 729 million (ICA, 2013). Table 12: Total Quantifiable Public loss (Severe Storms) Type of cost Amount (million $) Source Total (million $)

2007 Gippsland storm/flood response and recovery package

60 Flood Recovery Ministerial Taskforce, (2010)

60

Table 13: Total Quantifiable Private Insurance Loss for Severe Storm Events Storm event Amount (mil $) Source Total (mil $)

December 2003 Melbourne Storm

124 Baker et al. (2005)

2005 Storms 304 ICA

2007 Gippsland severe storm 18 ICA

2010 Melbourne Storm 1044 Insurance Australia Group, (2011)

2011 Victorian Severe Storms

488 ICA

2011 Victorian Christmas Day Storm

729 ICA 2707


Heat Waves Extreme heat is a leading cause of weather related mortality in many countries; severe heat waves cause an estimated economic loss of $1.27 billion per event in Australia (Captial Hill Consulting, 2010). Extended periods of extreme heat tend to be something Australians take for granted in the summer months, but are these periods becoming more consistent and intense? While some towns in Australia are famous for their extended runs of hot temperatures, the limited geographical nature of those events distinguish them from this January’s heat wave. Multiple days of extreme heat covering most of the continent are both rare, and isolated. It is not that common for the Australian-‐average temperature to exceed 39°C for even two days in a row. A run of three days above 39°C has occurred on only three occasions, and a run of four days just once, in 1972. The current heat wave has seen a sequence of Australian temperatures above 39°C of seven days, and above 38°C of 11 days straight.(Plummer, Trewin, Jones & Braganza, 2013). Dr Markus Donat is a Postdoctoral Research Fellow at the Climate Change Research Centre, UNSW, and states that

“in recent studies we have analysed how extreme temperatures have changed globally. For most regions, including Australia, we found that extremely high temperatures have become more frequent and more intense, while extremely low temperatures are occurring less frequently than they did in the middle of the 20th century (Science Media Centre, 2013).

2007 Victorian heatwave. The loss of electricity associated with a heat event in January 2007 is estimated to have had a total economic cost of AU $501m. (PWC, 2011, p21). Table 14: Total Quantifiable Private loss (2007 Heatwave) Type of cost Amount (million $) Source Total ($)

Economic loss 501 PWC, 2011, p21 501 2009 Heatwave. Victoria experienced an extreme heatwave when temperatures exceeded a record-‐breaking 47 degrees for several days and this, together with the tinder-‐dry countryside, provided the catalyst to horrific bushfires, starting on 7 February 2009, which lasted almost three weeks and killed over 200. In our southern cities, heatwaves like that experienced during 28-‐30th Jan 2009 can cause more than 200 premature deaths and financial losses of at least ~$0.8bn. The frequency of this sort of event is expected to double by 2030, and triple by 2070. Adaptation through better planning, urban design and renewal to actively reduce heat stress in built environments and improved community preparedness could reduce the impacts of one of these events by about 50%, saving ~$400m each time (CSIRO, 2010). The cost of the 2009 heatwave is estimated at $AUD 800 million due to power outages and transport disruptions, resulting in 25% of metro train services being cancelled, rail lines buckling, bitumen on major highways bleeding, concrete slabs lifting and cracking and traffic signals malfunctioning.


In addition, port facility productivity declined through vessel delays and reduced crane capacity. Furthermore, the analysis of such extreme events generally finds that post-‐event actions most likely result in only marginal improvements in resilience to such events unless a systematic and structured response, as recommended by the inquiring committees, is adopted (Chhetri, Hashemi, Basic, Manzoni & Jayatilleke, 2012). Table 15: Total Quantifiable Private loss (2009 Heatwave) Type of cost Amount (million $) Source Total ($)

Power outages, transport service disruptions and response costs

800 CSIRO, (2010) 800

Heatwaves: An After Thought. A 2013 VCOSS Report states that Victorians will face greater danger from heatwaves because of climate change and inadequate planning. Yet heatwaves are not included under Victoria’s emergency management provisions, even though the Department of Health recognises they require emergency responses. This means state and local governments, emergency services and local community sector organisations cannot effectively plan and respond, particularly when heatwaves often correspond with code red fire danger days. Since 2010 there has been very limited further investment in preparing for heatwaves. There are also concerns that significant numbers of Victorians, many of them disadvantaged and socially isolated, continue to be at risk from extreme heat (VCOSS, 2013).

So what greater measures could be taken to reduce the impact of heatwaves on Victorians and the strain on emergency services? The first of these possible areas of improvement is greater national consistency in key elements underpinning planning and response arrangements for heat events. Without an Australian heat event strategy it is difficult to track response cost by different government agencies (PWC, 2011, p36). The VCOSS Report calls for legislated standards to improve the

thermal efficiency at homes of vulnerable residents, including the disabled and chronically ill. Funding should also be boosted to better the quality, thermal efficiency


and cooling of low-‐cost housing (The Age, 2013). The Queensland University of Technology (2010) recommends the designation of a lead agency responsible for overall leadership and coordination to fully implement heatwave risk-‐reduction across all agencies and levels of government. Responses to these particular heatwave events have co-‐incited with major bushfire events in Victoria and the south-‐eastern states. The response and recovery costs can be seen to undifferentiated from the bushfire-‐related recovery costs. Although, under the Federal Natural Disaster Response and Recovery Arrangements (NDRRA), heatwaves are not a recognised emergency. Under these arrangements, state governments are able to claim reimbursement for 50 per cent of certain response and recovery costs for recognised disasters (Queensland University of Technology, 2010, p111). If heatwaves were recognised under these arrangements, it would lead to greater centralised accounting of the costs incurred by various state and local government agencies, and give the ability for states to be reimbursed by the Commonwealth.

Final calculation of the cumulative financial costs We have compiled all the figures tallied at the end of each disaster section this report to identify the total known financial burden on Victorians and the state over the past ten years: Public = $6,762.87 million Private = $13,174.2 million TOTAL = $19,937.07 million Note that these figures do not include the impacts of the 2013 fire season. Event Public costs (in

millions) Private costs Total

FIRE 2003 $1,414 $2,009.4 $3,423.4 2006 Grampians $373.4 $212.3 $585.7 2006/7 Great Divide $1,432.2 $1,680.1 $3,112.3 2009 Black Saturday $1,784.3 $3,832.8 $5,617.1 TOTAL $5,003.9 $7,734.6 $12,738.5 FLOODS Jan 2011 $1,424.1 (Incl

$971m in NDRRA flood relief)

$1,296.6 $2,720.7

March 2012 $189.6 $135 $324.6 Gippsland 2012 $25.27 n/a $25.27


TOTAL $1,638.97 $1,431.6 $3,070.57 STORMS Melbourne Dec 2003 n/a $124 $124 2005 n/a $304 $304 Gippsland 2007 $60 $18 $78 Melbourne 2010 n/a $1,044 $1,044 2011 (Cyclone Yasi) n/a $488 $488 Christmas day 2011 $60 $729 $789 TOTAL $120 $2,707 $2,827 HEATWAVES 2007 n/a $501 $501 2009 n/a $800 $800 TOTAL -‐ $1,301 $1,301 TOTALS $6,762.87 $13,174.2 $19,937.07

Policy implications and conclusion There are two elements of any meaningful response to climate change: mitigation (reducing greenhouse emissions) and adaptation (responding to the changed conditions that will come as a result of climate change). Mitigation. The current Victorian government has walked away from any meaningful attempts at mitigation. It has even dismantled the main framework that would allow the state to respond to the threat of climate change – the Climate Change Act (2010). Climate science is very clear that we all have a role to play in reducing emissions. As the worst state in Australia in terms of per capita greenhouse gas emissions there is a particular onus on Victoria to show leadership and act decisively to reduce it’s emissions. The current overwhelming reliance on fossil fuel sources for powering Victoria's grid will need to end, and a much greater investment into clean power will be a lead action in starting to mitigate the effects of climate change. If the Victorian government is serious about wanting to reduce the financial costs of recovering from natural disaster events, then reducing greenhouse gas emissions should be a top priority for the state. Key elements of a meaningful response to climate change through decisive action to reduce Victoria’s contribution to climate change must include the following:

• Remove policy road blocks to the rapid development of renewable energy (re-‐write the VC82 laws)

• Re-‐instate a feed in tariff for domestic and mid scale solar to drive uptake of solar PV


• Rebalance public funding away from coal and into renewables, including R&D and direct public investment in projects

• Rule out any further allocation of coal, either for domestic use or export • A ban on any new power stations that rely on fossil fuels • Act to rule out further on shore fossil fuel developments, including

unconventional gas • Re-‐instate the Climate Change Act with scientifically robust and binding emissions

reductions targets • Develop a state wide housing retrofit program to bring existing houses up to an 8

star standard and re-‐write building code to ensure that all new domestic, commercial and public construction is done to a minimum of an 8 star standard

There are an array of other measures the State can take in reducing future natural disaster expenditure, many involving different levels of government playing multiple mitigation roles to achieve this goal. Adaptation. Climate change is already happening and will bring many direct impacts with it. Adapting to these impacts is something the Victorian government will need to place at the top of it's agenda if the state wants to reduce it's payout for responding to the type of extreme weather events described in this report. As a result of failure on the part of both federal and state government, in many ways leadership on climate change has fallen to local government. Many local governments have been proactive in dealing with climate change in a number of ways. However, actions at the state level do not come close to addressing the scale of change needed to prepare for and help avoid dangerous climate change, and it is not expected that local governments can achieve this alone. What is required is to have climate change responses around adaptation to be incorporated at the highest level of government. The Department of Premier and Cabinet should be responsible for over all co-‐ordination of climate adaptation response. The government needs to be able to track the overall costs associated with extreme weather events and disaster recovery. The State budget should include an annual statement on the economic costs of extreme weather events, so that the government can more easily track the trends and plan accordingly. This information needs to be aggregated into a single figure and be highlighted in budget documents. The current itemisation of Natural Disaster Financial Assistance for local councils is already provided in the budget. This line item should also have a breakdown of other costs to the state government as a result of preparing for, and recovering from natural disasters. http://www.dtf.vic.gov.au/Victorias-‐Economy/Natural-‐disaster-‐financial-‐assistance A full risk assessment needs to be taken of the economic costs of climate change and whether the current Victorian Climate Change Adaptation Plan is sufficient to the scale


of the risk we appear to be facing. It has been criticised because it largely just reconfirms agreements about delineation of roles between state government and local councils rather than offers significant new actions. There are no substantial budget allocations to adaptation activity, and no obligations by government to take climate change considerations into account in approving major developments. The government must commit to re-‐writing the current adaptation plan to ensure it is bench marked on best practise documents from similar jurisdictions. A key plank in Victoria’s climate change strategy should include funding for behaviour change programs that address local adaptation and mitigation needs. Local governments are ideally placed and highly skilled in building community capacity, therefore behaviour change programs should be conducted by local governments with local communities. These programs should be properly funded by State Government (VLGA, 2009, p26). Collaboration between local and State government is essential, especially when considering the overlap in service provision and responsibilities. NGOs and community groups should also be eligible for delivery of these programs. Adapting to climate change impacts should be considered in strategic health service planning. The health care system, and the community, need to be prepared to deal with the full spectrum of climate change-‐related health risks. Increases in climate related sickness and disease will place a greater strain on health care services, particularly with an ageing population. Disaster preparedness across all relevant sections of government, and appropriate health care surge capacity (the ability to respond adequately to a sudden and unexpected disaster), will be vital for effective responses to extreme weather events (NCCARF, 2013). Adequate infrastructure planning is also essential. If infrastructure design does not account for withstanding disaster events, recovery costs will severely continue to impact the taxpayers of Victoria. Planning for a future warming climate will be essential if recovery costs for events like heatwaves, bushfires and floods are to be minimised. As we have seen, a warming climate will lead to a greater severity of these disaster events; and this will put more stress on health, support and emergency services and the Victorian taxpayer. Greater financial expenditure accountability will be required to produce a more accurate picture of how much the state is really investing in recovery disasters. If these recovery costs were easily accessible to the public, it would place greater pressure on the State to invest into greater mitigation action. The costs of preventive actions are always lower than dealing with the consequences. The same is true for the health effects from climate change. The economic costs of adaptation strategies can be minimised if new approaches are carefully considered and integrated alongside other planned changes (NCCARF, 2013). Reducing Victoria's greenhouse gas emissions is a vital action for reducing the future expenditure of recovering severe disaster events like the examples given in this report. As noted recently by ANU academic Liz Hanna, a specialist in the health impacts of climate change, of


"without rapidly decarbonising our economy, a global health crisis will inevitably follow." The financial costs of ever growing numbers of natural disasters can be expected to drain public and private budgets, make insurance impossibly expensive for many, and run the risk of causing severe damage to the state’s economy.

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