Fin24

Australia outlines huge cost of floods

2011-01-17 06:31

Sydney - Floods that have hit large areas of Australia, destroying thousands of homes and businesses, are likely to be the most costly natural disaster in the nation's history, Treasurer Wayne Swan said Monday.

Torrential rains which began in northeast Queensland state late last year have created huge flood zones, disrupting valuable coal exports, wiping out crops and washing away infrastructure such as roads and railways.

Swan refused to put a dollar figure on the cost of the floods, saying it was not yet possible to give an accurate assessment, but said the government would foot much of the bill.

"It looks like this is possibly going to be, in economic terms, the largest natural disaster in our history," Swan told state broadcaster ABC.

"It will involve billions of dollars of Commonwealth money, and also state government money, and there's going to be impacts on local government as well."

Swan said the rebuilding process, which began in earnest at the weekend with tens of thousands of volunteers turning out to clean up flooded homes in the Queensland capital Brisbane, would take years.

The centre-left Labor prime minister Julia Gillard has promised to return the budget to surplus by 2013 and Swan said the government, which has already doled out millions in emergency relief, was still committed to this.

"There's no doubt that the costs involved in responding to this natural disaster are substantial," he said.

"But we shouldn't forget that we've also got a very strong economy, a strong investment pipeline, and strong public finances.

"So we do have underlying economic strength to deal with the challenges that are proposed by this natural disaster, but of course it will involve difficult decisions for us as we go forward."