NSW Auditor-General releases report on natural disasters

The NSW Auditor-General has released a financial audit report, focusing on the impact of natural disasters in NSW. Financial audits are designed to add credibility to financial statements, enhancing their value to end users. Also, the existence of such audits provides a constant stimulus to entities to ensure sound financial management. 

Natural disasters continue to have a significant impact on people, property, and the public sector of New South Wales. Significant resources have been directed towards responses and economic recovery. The scale of government responses to these events has been significant and wide-ranging involving emergency response coordination, service delivery, governance, and policy. 

According to the Department of Planning and Environment, in New South Wales the impacts of a changing climate, and the risks associated with it, will be felt differently across regions, populations and economic sectors. The department’s climate projections indicate the number of hot days will increase, rainfall will vary across the state, and the number of severe fire days will increase. 

There were 29 natural disasters declared during the past two financial years. According to the Australian Bureau of Meteorology, the return of La Niña in September 2020 has influenced the weather patterns leading to severe flooding in New South Wales, especially Northern New South Wales. Many local government areas (LGAs) were impacted by multiple separate events.  

Over the past two financial years, the most significant events which impacted the most LGAs were: 

• 10 March 2021: storms and flooding across 78 LGAs  
• 9 November 2021: severe weather and flooding across 61 LGAs  
• 22 February 2022: severe weather and flooding across 62 LGAs  
• 27 June 2022: severe weather and flooding across 51 LGAs  
• 14 September 2022: flooding across 75 LGAs.  

The Bureau of Meteorology has identified October through to April as the highest risk period for storms. 

During 2021–22, the NSW State Emergency Service requested and received assistance from the Australian Defence Force to provide specialised response to the February 2022 severe weather and flooding events. The ‘National Defence: Defence Strategic Review 2023’ (DSR) identified climate change as a national security issue. Defence is frequently required to assist in disaster relief efforts, which is claimed to negatively affect force preparedness, readiness and combat effectiveness.  

This review agreed in principle to the following:  

• Commonwealth should work with states and territories to develop national resilience and response measures for adverse climate change at the local level without the need for Australian Defence Force support, except in the most extreme emergencies;  
• Defence should be the force of last resort for domestic aid to the civil community, except in extreme circumstances. 

Financial implications for the NSW Government due to natural disasters 

$1.4 billion spent during 2021–22 responding to natural disasters  

Over 2021–22, the NSW Government budgeted $1.9 billion ($725 million in 2020–21) to respond to natural disasters. The actual expenditure by the State on disaster response, over the same period, was $1.4 billion, an increase of $815 million. 

Regional NSW incurred the bulk of natural disaster costs during 2021–22, $447 million in actual costs compared to a budget of $708 million. 

$2.6 billion additional support for flood affected communities 

Since the 2022–23 Budget, New South Wales experienced three further major storm and flood events. In response, the NSW and Australian Governments have jointly committed an additional $2.6 billion to 2025–26 to support impacted communities and better prevent, prepare for, respond to, and recover from future natural disasters. Key commitments include: 

• $1.1 billion in grants and support funding to communities, business and councils impacted by flood events throughout 2022  
• $800 million for the Resilient Homes Fund to improve the resilience of homes in high-risk flood areas  
• $500 million for Regional and Local Roads Repair Program to support local councils to repair flood-impacted roads  
• $199 million to implement recommendations from the Flood Inquiry including enhancing flood-rescue capability, supporting delivery of key disaster welfare functions and support for volunteers  
• establishing NSW Reconstruction Authority to support communities to build greater resilience and rebuild and recover quickly from disasters. 

You can read the full report at the NSW Audit Office website.