Implications

Much of the Australian population is at some form of natural peril. Since settlement, a number of options have been taken on an ad hoc basis to try to manage the impacts of natural disasters including relocating the population from heavily exposed areas; implementing land-use planning strategies to direct growth to lower risk areas; and constructing levees and dams to minimise the impact of flooding.

Yet without a consistent, long-term and national approach, large parts of the country including the most populated or economically valuable, remain exposed to natural perils.
Recent economic analysis has highlighted that successive governments have overinvested in post-disaster reconstruction and underinvested in mitigation that would limit the impact of natural disasters on our economy and communities.

As a general rule, one dollar spent on mitigation can save at least two dollars in recovery costs. The Australian Government spend on mitigation measures is equivalent to three per cent of what it spends on recovery and rebuilding efforts.

The rebalance of this spending allocation is a national priority. Investment in mitigation strategies reduces the cost of reconstruction and safeguards our communities. A safer future does not just depend on the government. Individuals and communities also have what the Royal Commission into Victoria’s bushfires calls a ‘shared responsibility’.

While all levels of government, including emergency services and land use planning and building regulators, should take steps to improve protective infrastructure, individuals and businesses need to be educated and empowered to take more responsibility for their own safety.

Without heightened awareness, appropriate information and a co-ordinated, long-term approach to managing risks, individuals, businesses and government will remain exposed and our future economic strength and stability will be at risk.

Key findings

Our analysis found:

• Areas of key economic importance at high to extreme risk include large parts of our mining industry and knowledge economy hubs in the major Central Business Districts (CBDs).
• $326.6 billion worth of GDP (20.3 per cent of the Australian economy) and 3.9 million people (17.3 per cent of the population) are in LGAs with a high to extreme risk of tropical cyclones. Recent tropical cyclones have significantly impacted on mineral and agricultural production.
• 28.4 per cent of GDP ($425.5 billion) and 24.9 per cent of the population (5.5 million people) are living in LGAs with high to extreme flood risk. The Queensland floods in 2011 illustrated the disruption to the region’s economic activity and highlighted how a community’s economic capacity impacts its ability to respond and rebuild following natural disasters.
• Parts of the Melbourne CBD and its 450,000 workers are at very high risk of flood. Flooding has impacted on the transport network in the Melbourne CBD several times recently causing economic disruption.
• The 500,000 workers in the Sydney CBD have experienced transport disruptions caused by storms in recent years.
• LGAs with high and extreme risk of bushfire generated $175 billion (10.8 per cent) of GDP and are home to 2.2 million people (9.2 per cent of the population).
• LGAs with high and extreme risk of earthquakes generate $853 billion, or 52.5 per cent, of Australia's GDP and house 58 per cent of our population.

Summary tables

The summary tables below present the 2017 LGA Population by risk level for four natural perils (bushfire, flood, storm and tropical cyclone) for New South Wales, Victoria and Queensland. The risk ratings are useful in comparing areas for the same peril (e.g. comparing flood risk between two LGAs), however, the risk ratings for the various natural perils are not comparable to each other. That is, the risk or potential impact of an earthquake in an extreme risk area is not the same as an extreme risk for bushfires.