REC339-4473

The Committee recommends that the Australian Government work with State, Territory and local government through National Cabinet to ensure that further development does not occur in areas of 1-in-100 flood risk or greater. The boundary for no future development should take account of climate modelling of future increases in risk, in addition to current estimates of risk. The Committee further recommends that the Australian Government explore mechanisms that it can adopt to give effect to this unilaterally, including:
- Publicly disclosed risk information at the individual property level, including for new developments. This could be through a range of mechanisms, including:
- a portal informed by data provided to the Commonwealth government through the Hazards Insurance Partnership for all property released for development.
- A regulatory mechanism to discourage banks from loaning for further development at a 1/100 risk or higher (such as risk rating banks’ capital to appropriately reflect flood risk; an agreement between government, the Australian Prudential Regulation Authority, and major banks that such loans will not occur, or other regulatory mechanisms). These measures could apply to lending to both developers and to residential purchasers.
- Access to any flood pool (or subsidies) would not be available to properties approved in high-risk areas after the creation of the scheme.