Government coffers set to feel brunt of fire clean-up

DINAH Arndt: Is it possible to put a price tag on disaster?

The human toll is immediately apparent: lives lost or disrupted; injuries sustained; property taken; and communities affected.

All that comes at a cost - emotionally and financially.

Insurance companies estimate that Tasmanians lost $76 million worth of property in this month's bushfires based on the 1190 claims filed so far.

Many people would have been under-insured, and some would not have been insured.

The latter will rely heavily on donations made to appeals like the Red Cross Tasmanian Bushfires Appeal, which had banked $3.85 million as of Thursday.

The committee in charge of that cash began handing it out to those in need this week.

Some people felt it had taken too long; almost three weeks having passed since the fires raged.

Considering the committee was only appointed 10 days earlier its members did move rapidly.

First, those eligible for assistance needed time to register. Then, the committee had to figure out what its criteria was.

It would be irresponsible to rush such payments through, only to find they went to the wrong place.

It is painful to balance that against the pressing need of those who have lost so much. However, emergency cash payments were available, from the state and federal governments, three days after the disaster hit.

Eventually, every Tasmanian will pay for the bushfires.

It is clearly going to hit state Treasury hard, but for the moment we don't know exactly how badly the budget will be affected.

Premier and Treasurer Lara Giddings has repeatedly said it is too early to calculate.

Consider though, state-owned business Aurora Energy for an example.

Within a fortnight up to 250 staff worked at all hours to replace 618 poles, 80 transformers and about 100 kilometres of power line. Aurora chief executive Peter Davis said that work would cost the company tens of millions of dollars.

The budgets of most state departments are likely to take a hit as a result of the bushfires, including Primary Industries, Parks, Water and Environment, Police and Emergency Management, Health and Education.

Then there are the clean-up costs, for which the government pledged to foot the bill. As well as the administrative costs of the appeal.

And so the price keeps rising.

During the Black Tuesday fires of 1967 more than 100 fires raged across Tasmania killing 62 people and destroying 1293 homes.

Another 900 people were injured, 7000 left homeless and more than 250,000 hectares burnt.

The cost of that disaster was eventually put at $40 million.

Using the Reserve Bank's inflation calculator that equates to about $450 million in today's terms.

This time, around 40 bushfires destroyed or damaged more than 200 buildings and burnt 110,000 hectares.

Thankfully, no lives were lost as a result of the fires.

Meanwhile, the financial cost to a state that is struggling to rein in its budget will be considerable.

The question is, how will the government pay for it? By taking on more debt? By lobbying the Commonwealth for yet more assistance? Or, through taxes?

In The Companion to Tasmanian History Professor Roger Wettenhall noted that the 1967 disaster later produced an economic boon, "with an estimated $34 million injected into the state's economy in quick time".

In a financial report released this week, Commsec chief economist Craig James predicted the same thing would happen this time around.

"The Tasmanian economy is still struggling, but there will be rebuilding activity in some areas following recent bushfires," Mr James noted.

That, however, won't be enough to save Tasmania's hip pocket.

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