costs? to what extent?” - oecd · 2016. 3. 29. · page 2 / 12.09.2013 / oecd expert meeting on...
TRANSCRIPT
OECD High Level Risk Forum Walter J. Ammann
Paris, 12 – 13 Sept. 2013
www.grforum.org
“Risk Prevention and Mitigation – At what
Costs? To what Extent?”
Walter J. Ammann, Global Risk Forum GRF Davos
OECD High Level Risk Forum Walter J. Ammann
Paris, 12 – 13 Sept. 2013
www.grforum.org
: “Risk Prevention and Mitigation – At what Costs?
To what Extent?”
“Risk Reduction – At what Costs? To what
Extent?”
Walter J. Ammann, Global Risk Forum GRF Davos
OECD High Level Risk Forum Walter J. Ammann
Paris, 12 – 13 Sept. 2013
RISK REDUCTION ALONG THE WHOLE RISK CYCLE
OECD High Level Risk Forum Walter J. Ammann
Paris, 12 – 13 Sept. 2013
Processes
RISK – THE THREAT OR HAZARD SIDE (PROCESSES)
OECD High Level Risk Forum Walter J. Ammann
Paris, 12 – 13 Sept. 2013
Values exposed to
hazards
RISKS – THE VALUE AT RISK SIDE
Vulnerabilities
OECD High Level Risk Forum Walter J. Ammann
Paris, 12 – 13 Sept. 2013
Processes Values exposed to hazards
RISK
(Damage potential)
RISK – THE POTENTIAL INTERATCTION SIDE
OECD High Level Risk Forum Walter J. Ammann
Paris, 12 – 13 Sept. 2013
RISK– A HUMAN (SOCIAL) CONSTRUCT
Natural hazards
Ressources (potential)
Hazard space Living space
Damage potential
Spatial use
OECD High Level Risk Forum Walter J. Ammann
Paris, 12 – 13 Sept. 2013
RISK AND CHANCES – TWINS
Natural hazards
Ressources
(potential)
Hazard space
Living space
Damage potential
Spatial use
1st stage: Vulnerability
OECD High Level Risk Forum Walter J. Ammann
Paris, 12 – 13 Sept. 2013
RISKS AND CHANCES MANAGEMENT – THE NON-
MONOZYGOTIC TWINS
Natural hazards
Ressources
(potential)
Hazard space
Living space
Damage
potential
Spatial use
2nd stage: Risk management
Residual
Risk
Chances
Creating new risks – new
interdependencies – periodic
assessment: risk controlling
OECD High Level Risk Forum Walter J. Ammann
Paris, 12 – 13 Sept. 2013
DEFINITION OF RISK IN ENGINEERING TERMS
RISK Hazard Values at Risk Vulnerability = x x
Climate Change
will increase the
frequency and
intensity
Humans,
Animals, Assets,
Infrastructures,
Services,
Environment
All values are
vulnerable.
Vulnerability can
be reduced with
measures
Resilience
OECD High Level Risk Forum Walter J. Ammann
Paris, 12 – 13 Sept. 2013 1ère Partie
1999
2003
2007
Example: Dubai
DEVELOPMENT OF THE „VALUES EXPOSED“
OECD High Level Risk Forum Walter J. Ammann
Paris, 12 – 13 Sept. 2013
What has to be done?
Measures to be taken
What can
happen?
Risk Analysis
What is
acceptable to
happen?
Risk Assessment
Hazard analysis (hazard
intensity and exposure
analysis, vulnerability,
Scenarios important
What is an accepted
safety level?
(Protection goals,
acceptable risk levels)
How safe is safe enough?
IRM – RISK CONCEPT AND KEY QUESTIONS
OECD High Level Risk Forum Walter J. Ammann
Paris, 12 – 13 Sept. 2013
insignificant small perceptible critical catastrophic
IMPACT
Pro
bab
ilit
y
imp
rob
ab
le
ve
ry r
are
ra
re
po
ss
ible
fre
qu
en
t Technical
Other
Natural
RISK MANAGEMENT - RISK MATRIX
OECD High Level Risk Forum Walter J. Ammann
Paris, 12 – 13 Sept. 2013
What has to be done?
Measures to be taken
What can
happen?
Risk Analysis
What is
acceptable to
happen?
Risk Assessment
Hazard analysis (hazard
intensity and exposure
analysis, vulnerability,
Scenarios important
What is an accepted
safety level?
(Protection goals,
acceptable risk levels)
How safe is safe enough?
IRM – KEY QUESTIONS AND PARADIGM SHIFT
OECD High Level Risk Forum Walter J. Ammann
Paris, 12 – 13 Sept. 2013
Avoiding, eliminiating
risk situations
Risk reduction
by preventive
measures
Risk Transfer (Micro-)
Insurance
Self-Responsibility
(Residual Risk)
Tota
l ori
gin
al
risk
lev
el
Emergency
Management
mitigate, adopt, share, suffer,
RISK REDUCTION - WHAT POSSIBILITIES EXIST?
OECD High Level Risk Forum Walter J. Ammann
Paris, 12 – 13 Sept. 2013
What has to be done?
Measures to be taken
What can
happen?
Risk Analysis
What is
acceptable to
happen?
Risk Assessment
Hazard analysis (hazard
intensity and exposure
analysis, vulnerability,
Scenarios important
What is an accepted
safety level?
(Protection goals,
acceptable risk levels)
How safe is safe enough?
IRM – KEY QUESTIONS AND PARADIGM SHIFT
Hazard approach – reactive
Risk approach – proactive
OECD High Level Risk Forum Walter J. Ammann
Paris, 12 – 13 Sept. 2013
What has to be done?
Measures to be taken
What can
happen?
Risk Analysis
What is
acceptable to
happen?
Risk Assessment
Hazard analysis (hazard
intensity and exposure
analysis, vulnerability,
Scenarios important
What is an accepted
safety level?
(Protection goals,
acceptable risk levels)
How safe is safe enough?
IRM – RISK CONCEPT AND KEY QUESTIONS
OECD High Level Risk Forum Walter J. Ammann
Paris, 12 – 13 Sept. 2013
• Individual risks
• Collective risks (whole society risks)
RISK CONCEPT – PROTECTION TARGETS
OECD High Level Risk Forum Walter J. Ammann
Paris, 12 – 13 Sept. 2013
RISK CONCEPT – INDIVIDUAL RISKS
Individual risk:
Annual mortality probability: 10-5
OECD High Level Risk Forum Walter J. Ammann
Paris, 12 – 13 Sept. 2013
• Individual risks
• Collective risks (whole society risks)
RISK CONCEPT – PROTECTION TARGETS
OECD High Level Risk Forum Walter J. Ammann
Paris, 12 – 13 Sept. 2013
Probability (p)
Events per year
Impact (I)
CHF
10-4
10-3
10-2
10-1
104 105 106 107 108 109 1010
RISK CONCEPT – COLLECTIVE RISKS
Threshold/ safety
levels no longer
applicable
Minimal
requirements,
building standards?
OECD High Level Risk Forum Walter J. Ammann
Paris, 12 – 13 Sept. 2013
collective
risk (EUR) risk baseline
optimal function of
risk reduction measures Costs for a
measure
maximum
risk-
reduction for a
given
investment
costs for risk reduction
measures (EUR)
MARGINAL COST CONCEPT
Monetarization of risks to
make them comparable
Marginal costs (willingness
to pay per life saved)
Switzerland: 4 – 8 Mio EUR
OECD High Level Risk Forum Walter J. Ammann
Paris, 12 – 13 Sept. 2013
collective
risk (EUR) risk baseline
cost-benefit value of the optimal measures
marginal costs criteria (1 : 1)
Kosten für
Sicherheitsmassnahmen
Cost effective/efficient
1 EUR risk reduction =
1 EUR investment costs
MARGINAL COST CONCEPT
OECD High Level Risk Forum Walter J. Ammann
Paris, 12 – 13 Sept. 2013
GRF RISK PYRAMID
(DEVEOLPPED FOR CRITICAL INFRASTRUCTURES)
• Sch
State of the art, norms,
standards
Risk -Approach
OECD High Level Risk Forum Walter J. Ammann
Paris, 12 – 13 Sept. 2013
Avoiding, eliminiating
risk situations
Risk reduction
by preventive
measures
Risk Transfer (Micro-)
Insurance
Self-Responsibility
(Residual Risk)
Tota
l ori
gin
al
risk
lev
el
Emergency
Management
Rehabilitation
Insurance
Technical measures
Organisational measures
Education
Training
Recovery
Prevention
Organizational measures
Emergency/ Crisis Management
Intervention
Rehabilitation
Insurance
Technical measures
Organisational measures
Education
Training
Recovery
Prevention
Organizational measures
Emergency/ Crisis Management
Intervention
«The benefits of prevention are
not tangible; they are the
disasters that did not happen» Kofi Annan, former UN SG
mitigate, adopt, share, suffer,
PREVENTION – WHY IS IT SO DIFFICULT TO
IMPLEMENT?
OECD High Level Risk Forum Walter J. Ammann
Paris, 12 – 13 Sept. 2013
WHERE TO ALLOCATE DRR IN INTERNATIONAL
SUPPORT
• DRR is a development issue and not humanitarian aid
• Prevention has to become part of sustainable development
and not of ex-post international humanitarian aid (only
about 5% of international budget allocation is used for
prevention).
• international aid to be re-iterated from being used as a
instrument by foreign politics to sustainable development.
– Response is highly visible in the media – prevention is
not!
– Evidence based assessment of response (and
recovery) is missing to clarify their cost/benefit
performance
– Mistaking preparedness for prevention.
OECD High Level Risk Forum Walter J. Ammann
Paris, 12 – 13 Sept. 2013
MARGINAL COST CONCEPT
• IRM needs a country specific vision, a clear risk
concept and tools for risk analysis and risk
assessment, protection targets, an
implementation strategy, budgets, responsibility
allocation and coordination.
Necessity of a conceptual and methodological
framework for risk analysis, assessment and
mitigation
Paradigm shift from ex-post, reactive disaster
response and recovery to pro-active integrative
risk management
OECD High Level Risk Forum Walter J. Ammann
Paris, 12 – 13 Sept. 2013
Swiss Re Global Partnerships | August 2012
Financing considerations
Public
sector
Individuals
Corporates
Insurers
Banks
28
WHO TAKES THE LEAD FOR DRR PREVENTION?
A JOINT MULTI-STAKEHOLDER EFFORT
Costs of catastrophes USD bn, 2011 prices
0
50
100
150
200
250
300
350
1981 1991 2001 2011
Source: Swiss Re sigma database
Need for a multi-stakeholder approach and a culture
of trust
OECD High Level Risk Forum Walter J. Ammann
Paris, 12 – 13 Sept. 2013
• Root causes and impact
often differ in space and
time (externalisation of
impacts and
internalisation of
benefits)
• People tend to redirect
and displace rather than
resolve risk dilemmas
THE PROBLEM OF SCALE AND SPACE
global
national
regional
local
Allocate responsibilities and
accountability
OECD High Level Risk Forum Walter J. Ammann
Paris, 12 – 13 Sept. 2013
RISK CULTURE AND RISK GOVERNANCE
• Risk governance structures need to be tailored
according to the main goal of creating a
responsive risk culture
• IRM needs a long-term perspective (decades,
centuries - for risks with low probabilities but high
consequences), which contradicts to the (short-
term) perspective of political bodies and their
accountability
ex-ante responsibilities to stress, (not only
recognize ex-post disaster management
capabilities of politicians).
OECD High Level Risk Forum Walter J. Ammann
Paris, 12 – 13 Sept. 2013
SUMMARY - RISK CONCEPT AND MARGINAL
COST CONCEPT
• Provide evidence that prevention pays off in
IRM with clearly defined risk reduction targets.
• Collective risk:
– Marginal cost/ willingness to pay- concept leads to
efficient allocation of resources to cover the
collective risks.
– « Affordability to pay per live saved » not only leads
to economic optimisation but is a socio-political
concern to be considered additionally.
• Individual risk:
– Individual risk addressed by probability of loss of
live.
OECD High Level Risk Forum Walter J. Ammann
Paris, 12 – 13 Sept. 2013
CONTACT INFORMATION
Global Risk Forum GRF Davos
Promenade 35
CH-7270 Davos
Phone: +41 (0) 81 414 1600
Fax: +41 (0) 81 414 1610
www.grforum.org
FROM THOUGHTS TO ACTION!
THANK YOU FOR YOUR
ATTENTION!
Global Risk Forum
GRF Davos
Page 1 / 12.09.2013 / OECD Expert Meeting on Risk Prevention and Mitigation
Governing Disasters: Challenges, Limitations, Lessons learnt.
An Austrian perspective.
Andreas Pichler, BMLFUW, Austria
Page 2 / 12.09.2013 / OECD Expert Meeting on Risk Prevention and Mitigation
Structure
Setting the scene about natural hazards in Austria>
>Limitations to risk-governance in Austria>Risk-governance: success factors in Austria
Financing risk prevention and mitigation incl. challenges >Final remarks and recommendations>
Page 3 / 12.09.2013 / OECD Expert Meeting on Risk Prevention and Mitigation
Avalanche Disaster 1999:
Tirol (Galtür, Valzur), Vorarlberg
Page 4 / 12.09.2013 / OECD Expert Meeting on Risk Prevention and Mitigation
Landslides Spring 1999:
Vorarlberg (Landslide Rindberg)
Page 5 / 12.09.2013 / OECD Expert Meeting on Risk Prevention and Mitigation
Rock-fall Disaster Summer 1999:
Eibelschrofen (Schwaz, Tirol)
Page 6 / 12.09.2013 / OECD Expert Meeting on Risk Prevention and Mitigation
Flood Disasters 2002, 2005, 2007, 2009, 2013
Page 7 / 12.09.2013 / OECD Expert Meeting on Risk Prevention and Mitigation
Debris flow disasters 2012
(St. Lorenzen, Styria; Virgen, Eastern Tyrol)
Page 8 / 12.09.2013 / OECD Expert Meeting on Risk Prevention and Mitigation
Setting the scene I: Natural Hazards in Austria
Austria in general exposed to floods, heavy
precipitation, thunderstorms, hail and storm; snow
avalanches in winter season; extreme events almost
every year
>
100.000 km of rivers and creeks, 9.000 lakes>
> 67 % of total area part of torrent and avalanche
catchments (about 13.000 torrent catchments and
nearly 6.000 snow avalanche paths)
Nearly half of Austria’s territory is covered by forests,
30,7 % of forests with protective function, main
problem is ageing and lacking regeneration
>
Landslides and rock-fall potential an all steep slopes
only 38% of the land area is available for settlements>
~ 60% of Austria’s territory is mountainous >
>
Page 9 / 12.09.2013 / OECD Expert Meeting on Risk Prevention and Mitigation
Setting the scene II: Risk by Natural HazardsIn global comparison: Austria is a relatively safe country concerning natural hazards (e.g. no MR Cat. 6 disaster observed in recent decades)
>
Approx. 400.000 buildings are endangered by natural hazards (incl. floods, avalanches, rockfall)>
Death risk due to natural hazards:>
Biggest natural disaster in terms of fatalities: snow avalanche season 1689, 256 people died
>
Major natural disaster: flood 2002 (2.9 billion EUR losses, 9 fatalities)>
The need of protection from natural hazards of people living in alpine regions is
constantly increasing.
Economic losses due to weather extremes in the last 20 yr ~ 9.5 billion EUR (Munich Re)
>
• Snow avalanches: 2,10 x 10-4 (~ 30 fatalities/yr)
• Lightning: 2,00 x 10-6
• Flooding: 5,00 x 10-7
~ every 3 years happens a natural disaster with losses > 200 Mio EUR (VVO – Austria)>
Page 10 / 12.09.2013 / OECD Expert Meeting on Risk Prevention and Mitigation
Governing natural disasters in AT: success factors (1)
Existing national strategy for disaster risk prevention as well as for disaster
management, with focus on limiting existing risks for human health, material
assets, economic activities and the environment to acceptable levels and to
prevent new unacceptable risks by permanent strategy adjustment in order to
maintain flexibility of all parts of society concerned with natural hazards.
>
Source: Rudolf-Miklau 2009)
Page 11 / 12.09.2013 / OECD Expert Meeting on Risk Prevention and Mitigation
Governing natural disasters in AT: success factors (2)
Established effective organisational / institutional structures and task sharing
(prevention / contingency / emergency mgt), more than 400.000 volunteers for
disaster relief
>
Page 12 / 12.09.2013 / OECD Expert Meeting on Risk Prevention and Mitigation
Governing natural disasters in AT: success factors (3)
Permanent investment in structural prevention facilities since centuries:
In Austria, approx. 250.000 structural prevention facilities are in place,
representing approx. more than 6 billion EUR (capital stock)
>
Page 13 / 12.09.2013 / OECD Expert Meeting on Risk Prevention and Mitigation
Governing natural disasters in AT: success factors (4)
Technical and ecological standards on natural hazard protection and
prevention are at the state-of- the-art (or beyond) in Austria: since 2006
“standardisation” of tasks regarding Natural Hazard Management is
considered as an key element, especially
>
Standards exist for torrent, avalanche and rockfall
related tasks
• Definitions, classifications
• Construction rules, materials, life cycle
• Products (certification, type test)
• Design (hydrology, hydraulics, statically, geotechnical)
• Impacts, loads, environmental conditions (in
preparation)
• Safety concept, structural failures
• Maintenance, monitoring and operability of control
structures
��
��
��
>
Page 14 / 12.09.2013 / OECD Expert Meeting on Risk Prevention and Mitigation
Governing natural disasters in AT: success factors (5)
Information and awareness: High coverage with hazard & risk maps,
easy accessible web-based information & support >
Page 15 / 12.09.2013 / OECD Expert Meeting on Risk Prevention and Mitigation
Governing natural disasters in AT: success factors (6)
R&D advances and increasing practical experiences: exchange of
knowledge and good co-operation and collaboration on national and
international level
>
Page 16 / 12.09.2013 / OECD Expert Meeting on Risk Prevention and Mitigation
Governing natural disasters in AT: limitations
Magnitude of the event>
> Global warming / global changes
Limited usable settlement area cause an upward trend in losses from natural disasters, because economic and population growth in higher-risk areas is still contributing to an increase in associated economic losses (and vulnerability in general)
>
Ageing of structural protection facilities – loosing functionality
>
Low penetration of private natural hazard insurance>
Processes like flash floods, debris flows, snow avalanches etc. are usually fast moving, and difficult to predict - early warning and subsequent actions are limited
>
Limited resources (financial, human, structural)>
Page 17 / 12.09.2013 / OECD Expert Meeting on Risk Prevention and Mitigation
Financing risk prevention and mitigation
Federal government spent in excess
of EUR 200 million per year for NHM>
Federal Disaster Fund (1966):
~ ��⁄ directly used for disaster prevention
~ ��⁄ e.g. providing equipment to fire
departments, funding early-warning systems, providing partial indemnities for the costs of natural disasters
Pro: regular and constant availability of budget for natural hazard protection
quick and unbureaucratic support in case of disaster (emergency)
financial support for private damages
Con: no incentives for private insurance system
>
Other: Federal Flood Disaster Act (HWG -2002, 2005, 2012, (2013))
Solidarity Fund of the EU-Commission (2002)>
Page 18 / 12.09.2013 / OECD Expert Meeting on Risk Prevention and Mitigation
Financing risk prevention and mitigation - Challenges
Public household: “consolidation” means also balancing more multi-
stakeholder perspectives with less funds available (lacking resources) >
In Austria, approx. 250.000
structural prevention facilities
are in place representing
approx. more than 6 billion
EUR (capital stock): how best
to keep their functionality?
>
Ongoing economic downturn: as the Disaster Fund potential depends on
several taxes (income, wage, tax on capital yields etc.) there is a risk on
future limitations to this instrument
>
Key challenge: Incentives to establish partnerships (public, private) that allow
to share the financial burden/risk of natural hazard prevention (e.g. insurance,
local water boards etc.) along a broader audience
>
Page 19 / 12.09.2013 / OECD Expert Meeting on Risk Prevention and Mitigation
Final remarks and recommendations (1)
NHM is no longer a pure technical discipline, nor a concern of “only” experts -
applying risk-cycle and life-cycle based approaches.>
Beside other constraints, a modern NHM strategy has to balance:>technical�economical�ecological�social�legal�political�natural�
standards, interests,
and uncertainties
organisational / institutional�
on a not only local but
even more regional /
trans-national / global
level
NHM has to contribute to avoid increasing depopulation of remote
regions in Austria, BUT: NO PROTECTION AT ALL COSTS.>
Natural hazards are still complex and are phenomena in nature that
cannot be prevented fully, only mitigated.100% safety against natural
hazards is not feasible.
>
Page 20 / 12.09.2013 / OECD Expert Meeting on Risk Prevention and Mitigation
>
Capacity building, awareness raising, interdisciplinary
communication and co-operation are as key factors of integral
natural hazard management
>
Investing in concepts that support people in a more ownership of risks
(natural hazard proofing, insurance opportunities etc.) is a step towards
balancing public and individual demands and interests
>
Fostering community-based public education initiatives>
Strengthening the principle of cross-border solidarity demonstrated in joint
assistance and relief operations among EU Member States>
Final remarks and recommendations (2)
Emphasising transnational cooperation by exchanging and sharing evidence,
experiences, knowledge and methods between administration, technical
authorities and academics
>
Harmonising/developing technical standards and codes
Page 21 / 12.09.2013 / OECD Expert Meeting on Risk Prevention and Mitigation
Final remarks and recommendations (3)
In Austria, natural hazard management is considered as part of the
state’s responsibilities “public safety” and “public precautions for existence”
>
The government’s role in disaster risk prevention and mitigation is
mainly to provide the framework for effective and efficient
• Legislation
• Horizontal and vertical co-ordination and harmonisation in planning
and strategy of natural hazard management
• Resource mobilisation
• Support in implementation
• Encouraging the access, and sharing of information and collaboration among all sectors, disciplines and societal groups
>
Page 22 / 12.09.2013 / OECD Expert Meeting on Risk Prevention and Mitigation
Thank you for yourattention!
© The Treasury
Post-disaster changes to risk prevention
and mitigation in New Zealand
Dr. Lindy Fursman
Principal Advisor
New Zealand Treasury
© The Treasury
Outline of presentation
Role of NZ government in risk prevention and mitigation
Structure of disaster risk management (including risk prevention and
mitigation arrangements) in NZ
Changes post- the Canterbury
Earthquakes
• Building standards
• Resource management
• Earthquake Commission
• Red Zoned land purchases
Challenges going forward
© The Treasury
Role of NZ government in prevention and mitigation
Central government creates the
legislative framework under which
risk prevention and mitigation
activities take place
Framework predicated on
assumption that local authorities are
best placed to manage risk
Settings aim to incentivise local
authorities to identify and manage
risk appropriately
Context of very high insurance
penetration
© The Treasury
Key legislative levers
Civil Defence and Emergency Management Act 2002
(CDEM Act)
Resource Management Act 1991 (RMA)
Building Act 2004
Earthquake Commission Act 1993 (EQC Act)
Private property Central government
assets
Local government
assets
Identify
Articulation of
responsibilities
Information on state
of land
Avoid
Regulate land use
Reduce
Building standards
Transfer
Insurance
Cost-sharing
Legislative framework: RMA and CDEM Act
Central government as service provider (GNS, Terralink, LINZ, NIWA)
Hazard mapping: local authorities identify and map
Legislative framework: RMA
Specific decisions devolved to local authorities
Legislative framework: Building Act
Central govt establishes legal minimums; local authorities implement according to specific regional
hazards
Specified cost sharing
arrangements under CDEM
Plan for the disaster response
and restoration of essential
infrastructure
Ad hoc transfers post-
disaster
Govt provision of disaster
insurance (EQC)
Private insurance: 95%+
penetration
No explicit disaster risk
management focus, but part
of broader fiscal strategy
(buffers)
Local government insurance
pool
Structure of management of disaster risk: legislation and
regulation
Legislative framework:
EQC Act
Legislative framework:
CDEM Act
© The Treasury
Responsibilities of local government
Resource management
Enforcement of building code
Enforcement of public health legislation
River management
Coordination of lifeline utility resilience
CDEM Groups:
• A consortium of local authorities in a region who
identify and understand hazards and risks
• Prepare CDEM Group plans and manage
hazards and risks in accordance with the 4Rs
(reduction, readiness, response and recovery)
Responsible for 40% of costs of restoring
essential infrastructure post-event
© The Treasury
Unintended consequences in complex systems...
• Assumption that local government has
the same incentives as central
government
• Devolved system – creates unexpected
contingent liability for central
government?
• NZ system performed well, but we
didn’t fully understand how settings
would play out
– EQC cover
– Private insurance
– Local government
• Are we designing systems to manage
liability or manage recovery? Or both?
© The Treasury
Changes post-quakes: Building standards
Earthquake prone buildings = those below
33% of Building Code
May 2011: strengthened standards for
residential properties in Canterbury (from
0.22 to 0.3)
August 2013:
• All buildings to be assessed within 5 years
• EQ prone buildings to be identified on a
public register
• 15 years from assessment for building to be
strengthened or demolished (ie 20 years
total, including assessment time)
© The Treasury
Changes post-quakes: Resource management
Resource Management Act:
• Principal statute for managing the use of natural and physical resources (including
the use of land) in New Zealand
• Combines environmental protection and planning law
Has been under review since 2008 – two phases of reform, currently in the
2nd
2 key legislative changes:
• “The management of significant risks from natural hazards” has been added to the
Purposes section of the Act - a significant ‘top down’ lever on local government
planning; and
• A specific requirement for local authorities to have regard to the risks of natural
hazards when granting consents for subdivision (the primary form of ‘land use’
consent under the RMA)
© The Treasury
Changes post-quakes: Review of Earthquake
Commission (EQC)
Research To understand and
reduce vulnerability to geological hazard
Education Encourage steps to reduce the effects
of geological disasters
Natural Disaster Insurance
Mitigate the financial impact of geological disasters
on home owners
Government goals
Minimise unacceptable social distress &
loss
Minimise fiscal risk
Efficiently manage disaster risk &
recovery
Support economic growth opportunities
Review
Coverage and caps – how much cover,
and at what layer of loss?
Pricing – should EQC risk-price for
cover?
Role – should EQC handle claims and
play a role in recovery efforts? If not,
who will?
Institutional arrangements – how much
Ministerial control?
© The Treasury
Changes post-quakes: Red Zone purchases
7860 properties that had suffered major
liquefaction and lateral spread
Homeowners offered two options:
• Option One – Purchase land and buildings at
current property tax valuation. Government
settles insurance claims
• Option Two – Purchase of land and buildings
at land only property tax valuation.
Homeowner settles insurance claims
Rationale?
Remediation of land possible – but with
timelines 5 -7 years.
• Social and safety issues for government
• Certainty sooner to insured home owners
• De-risking Canterbury for insurance markets
© The Treasury
Some challenges for Government
Most recent disaster is the one we focus on
Political economy vs cost benefit analysis
Capability
Unintended consequences of system
components
© The Treasury
Future work...
• Review of overall risk framework
• Calculating the Crown’s contingent liability
• Review of disaster recovery arrangements
• Focus on system level risk through the lens of
Living Standards
© The Treasury
Post-disaster changes to risk prevention
and mitigation in New Zealand
Dr. Lindy Fursman
Principal Advisor
New Zealand Treasury
JICA’s Cooperation for DRR&
Linking DRR to Sustainable Development by DR2AD Model
Sep 2013
TAKEYA KimioVisiting Senior Advisor of Japan International Cooperation Agency
Why Japan can dedicates on DRR
•Japan is the most natural hazardous country in the world.
•In the same time, one of the most technology oriented developed country.
•How Japan coexists with Disaster & Development
1
How Japan conquered disaster
2
Disaster
DisasterDisaster
Time
Development
Development were Obstructed by
Disasters,
Normal Development
Recovery & Development
At least, Build-back-better
Up to 15th Century, Tone River crossed the Kanto Plain from north to south and flew into Tokyo Bay
From 1594 to 1654, Tone River was connected to Pacific Ocean by eastward channel
・After the flood in 1910, flood control measures in upper and middle reaches has changed from “flood control allowing inundation” to “sequential levees confinement”
・After this change, the maximum discharge in the Tone River Channel has increased, which became the main challenge of flood control in Tone River Basin
Tone River
Kinu River
Watarase River
Kokai River
Tone River
Kinu RiverWatarase River
Kokai River
History of flood control in Tone River basin (400years ago)
Source: Water and Disaster Management Bureau, Ministry of Land, Infrastructure, Transport and Tourism, Japan
Source: Water Disaster Statistics, Ministry of Land, Infrastructure Transport and Tourism
350,000
300,000
250,000
200,000
150,000
100,000
50,000
01962 1967 1972 1977 1982 1987 1992 1997 2002 2007
Area inundated (ha)
Number of fatalities and inundation area have dramatically been reduced in Japandue to continuous investment in and efforts for flood mitigation.
Reduction of flood damages in Japan by continuous investment
6,000
5,000
4,000
3,000
2,000
1,000
01946 1951 1956 1961 1966 1971 1976 1981 1986 1991 1996 2001 2006
Number of fatalities by flood
5
•Population of damaged area of 3 prefectures,1km from coast is 460,000, 3km 1.0million, 5km 1.5million
•Total causalities were around ≒16,000
•460,000 residents lived in the tsunami affected area so that evacuation ratio can be estimated more than 96 %
•This high evacuation ratio achieved by legend transmission, by Tsunami Early Warning System and by evacuation drill effort
•65% of casualties were aged people, over 65 y.o.
Tsunami Evacuation Situation in general
96%> evacuated !!
For the CBDRM project, this is successful case
6
Successful Evacuation by Students in Kamaishi City
(Source: Research Center for Disaster Prevention in the Extended Tokyo Metropolitan Area, Gunma University)
More than 3,000 students decided to evacuate further to higher ground based on their own decision, as educated.
7
More than 97% evacuated successfully,but local economy was completely destroyed.
Can we say this “resilient”?We need more investment
to prevent disaster
8
JICA’s Support meet to the Priority Action
• The projects related to priority action 4 are increasing rapidly compared to others.
• It entails the best mix of structural and non-structural measures.
0 0 0 0 0 2 292 2 4 6 12
25 32
280
4
96
1525 34
81
4743
68
116
159
206
259
5 1323
4254
30
50
100
150
200
250
300
~1980 1981~1985 1985~1990 1991~1995 1996~2000 2001~2005 2006~2008
Priority 1_Ensure priority of disaster risk reduction
Priority 2_Knowing disaster risk and act
Priority 3_Improve knowledge of disaster risk reduction
Priority 4_Reduce risks
Priority 5_Prepare in advance and be ready to act for emergency
Priority 4
Priority 2
Priority 5
Priority 3
Priority 1
9
Levee
Combination of Structural Measuresand Non-Structural Measures
Investment
Effectiveness
Investment and Effectiveness
Levee
Barrage
Reservoir System
TargetSafety Level
10
Levee
Combination of Structural Measuresand Non-Structural Measures
Investment
Effectiveness
Levee
Barrage
Reservoir System
TargetSafety Level
Climate Variability?Climate Change?
How to prepare excess flood?or Project is not completed yet
1111
Target
Safety Level
Investment
Effectiveness
Levee
Levee
Barrage
Reservoir System
Structural Measures(Basic Infrastructures)
Non-Structural Measures
Mitigation Adaptation
Control, Protection
Goal
Safe and/or Resilient
Combination of Structural Measuresand Non-Structural Measures
How to invest today?Principle for
low regret investment
How about the magnitude of big earthquake
•C:¥DATA¥DATA¥日本の知見¥耐震実験¥www.bosai.go.jp¥hyogo¥movie.html
12
How about the magnitude of big earthquake?E/Q happens with long return period
Lesson learned of E/Q transferred to next generation?
If no, you can learn from examples
• C:¥DATA¥DATA¥日本の知見¥耐震実験¥www.bosai.go.jp¥hyogo¥movie.html
13
What is the barrier for mainstreaming the DRR
14
Disaster
DisasterDisaster
Time
Development
Obstructed byDisasters,
far away fromMDGs
Normal Development
Recovery & Developmentbut DRR investment is
much cheaper than recovery
At least,“build-back-better”
How to convince & mainstream DRR?
Need to show the evidenceto “political leaders”
15
Post MDG/HFA, 2015
Sustainable Development Goals
Post-2015 Development
Agenda
HFA2
2015
Rio+20(June 2012)
SDGsOpen Working Group
HLP Report(May 2013)
SG Report(Sep
2013)
GA discussion(Sep 2013 -)
GPDRR(May 2013)
Prep-Com
Sustainable Development Goals
Post-2015 Developmen
t Agenda
HFA2
DR2AD Model
•Economical Model which can measure
– GDP change
– income differential and Gini coefficient change in Lorenz curve
•With & Without DRR investment
•Philosophy from Japanese experiences “DRR investment Account for Development
18
JICA developed Dynamic Stochastic General Equilibrium Model to show the effectiveness of DRR investment
2013 Global Assessment Report P-87
19
GD
P
By disasters, increasing poverty and continued to be stuck in an increase in poverty, widening inequality, from the trap of poverty
Enlarged view
without disaster Effect of DRR investment
By the conventional benefit evaluation method, benefit of DRR investment is evaluated with collective amount of the society. (GRP and/or GDP)
Indicators to evaluate the entire
benefit (A)Disaster Event
With DRR Investment(with disaster)
Sustainable development
Without DRR Investment(with disaster)
Time
Stop of economic activity by direct damage⇒ Expansion of poverty
Stagnation of economic activity and the recovery delay due to lack of funds→ continuation of poverty trap
Differences with/without DRR investmentto GDP
Differences with/without DRR investment to Lorenz curve
21
0 0.2 0.4 0.6 0.8 1
1
0
45度線
Extreme Poor
Most Rich
Poor
Near Poor
Better Off
Incom
e C
um
ula
tive
Rela
tive F
req
uen
cy
Household No Cumulative Relative Frequency
Pakistan case for 2042 GDP will 25% down without DRR investment
22
Without Disaster
With DisasterWith DRR invest
Pakistan case for 2042 :Gini Coefficient proportion with or without DRR
23
Deliver as a Computer Softwarein order everyone can use
24
MDG Targets & Indicators exemplified by DR2AD
25
Targets Indicators Exemplified by DR2AD Model
Target 1.A
Halve, between 1990 and 2015, the proportion of people whose income is less than $1 a day
1A1 Population below $1/day, %
◎It is possible to calculate the expense of each person except the number ofpeople per household, it is possible to calculate the indicator of expectancyin the “First Edition”.
1A6 Poverty gap ratio at $1/day, %
◎It is possible to calculate the indicator of expectancy in the “First Edition”by using the rate of poverty or the Gini coefficient.
1A7 Poorest quintile's share in national income or consumption, %
◎It is possible to calculate the expense of each person by income level it ispossible to calculate the indicator of expectancy in the “First Edition”.
Target 1.B
Achieve full and productive employment and decent work for all, including women and young people
1B1 Growth rate of GDP per worker, %
◎It is possible to calculate the growth rate of GDP, it is possible to calculatethe indicator of expectancy in the “First Edition”.
1B2 Employment-to population ratio, %
○
It is possible to estimate the growth of the population, it is possible to calculate the indicator of expectancy in the “First Edition” if it is feasible to set up the distribution of employees in the lowest level of income according to the age and the population.
1B5 Proportion of workers living below $1/day, %
○
It is possible to calculate the amount of the expense of each person, it is possible to calculate the indicator of expectancy in the “First Edition” if it is feasible to set up the distribution of employees living below a dollar a day in the lowest income level.
1B6 Proportion of own-account and contributing family workers in total employment
△If the model of the industrial structure is classified in detail, it can be feasible to calculate the indicator of expectancy by improving the model.
Target 1.C
Halve, between 1990 and 2015, the proportion of people who suffer from hunger
1C3,4 Population undernourished,
○It is possible to calculate the indicator of expectancy in the “First Edition” if the consumption rate of calories is converted to the rate of expense.
Target 2.A
Ensure that, by 2015, children everywhere, boys and girls alike, will be able to complete a full course of primary schooling
2A1 Total net enrolment rate in primary education
◎It is possible to calculate the indicator of expectancy in the “First Edition” because the model is capable of taking account of human capital.
2A10 Literacy rate between 15 and 24 years old, %
○
Although it is hard to correlate the level of age with the , it is possible to calculate the indicator of expectancy in the “First Edition” if it is feasible to set up the distribution of the literacy level according to the social level.
Policy Brochure & Background White Paper
26
27
Proposing tools for Post MDG/HFA
Convince Policy Makerby DR2AD Model
Disaster Risk Assessment to all projects
for Lesson learned from recent mega disastersThree Principles approach for
Low Regret Investment
Future of DR2AD Model
28
JICA developed Dynamic Stochastic General Equilibrium Model, how DRR Investment Account for Development as for version 1.0
JICA wants to brush up DR2AD Model together with other agencies, using actual case study data
Collect dataset together and develop version 2.0 or more emphasized version like Static version Simplified capacity building educational version More emphasized to poorest layers
as a DR2AD Family Series
Start discussing UNISDR to apply DR2AD Model for 20 countries