Australia eyes levy to pay for flood rebuild

AUSTRALIA’S government is reportedly considering a taxpayer levy to help pay for massive flood rebuilding, while preserving the budget’s path back to surplus in 2012-13, as one major bank warned yesterday the damage bill could reach AUD$20 billion (€14.9bn).

A levy could take the form of an addition to the 1.5% Medicare levy backing public health and hospitals, and which raises AUD$10 billion a year, the Australian newspaper said, without naming sources.

Flooding blamed on rains triggered by a La Nina weather pattern in the Pacific has devastated huge areas of Australia’s eastern seaboard, flooded parts of Brisbane, the nation’s third-largest city, shut vital coal mines and rail lines, and destroyed crops.

Rebuilding estimates from banks and economists have mostly ranged from around AUD$3 billion to AUD$10 billion, but illustrating the uncertainty ANZ bank warned it could come in at close to double that when floodwaters subsided and the full scale of the devastation became clear.

A spokesman for Treasurer Wayne Swan said it was too early to speculate how the government would assist flood stricken communities.

Victoria state was bracing yesterday for more flooding expected to cut the town of Horsham in two while an eight-year-old boy was swept away at Shepparton. Thousands of people, in 51 towns, face an anxious wait over the next 24 hours as a series of flood peaks roll across the state.