Piers Akerman
Saturday, February 05, 2011 at 10:50pm

THERE’S a rotting smell beginning to come out of Queensland, and it isn’t from debris left by the floods or Cyclone Yasi. 

It has more to do with the Queensland Labor Government’s excuses for failing to take out insurance against natural disasters and the federal Labor Government’s determination to impose a distorted tax on the nation to pay for Queensland’s huge mistake.

On Thursday, Prime Minister Julia Gillard said Queensland’s lack of insurance cover for its assets was “a matter for Queensland”.

Bollocks to that idea, when she is also whacking a tax on Australians to pay for Queensland’s failure to insure its own infrastructure.

It was the only major state not to have insured public assets with a comprehensive disaster cover obtained on the international re-insurance market.

On Friday, Queensland Treasurer Andrew Fraser tried the same line, saying “re-insurance arrangements in Queensland for natural disasters have nothing to do with the Commonwealth Government meeting its share of the costs of natural disasters”.

Bollocks to that, too, when Queensland is asking for a hand-out to meet the costs it could have insured against.

As Fraser should be aware, just last Monday, as Yasi was looming in the South Pacific, officers from his own department were frantically ringing around other government departments asking what quotes they had from the insurance industry - an exercise in pre-emptive cover-up as they sought excuses they might be able to use to justify their later statements about the lack of insurance cover.

They were looking for information the Queensland Treasury should have possessed and should have already acted upon, but did not.

Sources within the Queensland Government say the failure to take out insurance cover is symptomatic of its financial mismanagement.

They claim the Queensland Government arranges insurance for all infrastructure as it is being built, but ceases insuring it when construction is completed.

Treasurer Fraser offers the weak excuse that insurance would cost too much and is not necessary because of natural-disaster relief arrangements made with the Federal Government.

But there’s nothing special about the disaster relief arrangements - they apply to every state, and every other state also takes out insurance.

Further, the arrangements are just that - arrangements, not agreements. They’re ad hoc, and rely on the Federal Government to initiate them.

If the Queensland Government had managed its insurance program responsibly, it would gave been able to re-insure and aggregate its risk insurance, thus accessing lower-cost insurance.

Instead, it is relying on an arrangement that may or may not be agreed when it is needed.

Queensland’s credit rating has been downgraded, and this financial mismanagement increases its fiscal volatility, thus increasing the financial risk and increasing the likelihood of a further review of Queensland’s credit rating.

It is not in the Federal Government’s interest to point this out, as Queensland Premier Anna Bligh has become the new Labor poster girl through her tireless appearances as the nation’s newest emergency services and weather spokesperson.

Although her media performances have dazzled some star-struck commentators always on the hunt for the latest Labor messiah, the hard questions have not been asked.

Bligh or her Treasurer must tell the nation what quotes the Queensland Government has received from the insurance market, when they were received and whether the Government has reviewed them recently.

Australians also need to know how much more they will be paying to meet the costs associated with damaged, uninsured government infrastructure in Queensland, as compared with the costs of damaged but insured government infrastructure in Victoria.

It is ridiculously arrogant for federal Infrastructure Minister Anthony Albanese to declare that it is none of our business when he and his leader have been so quick to publicly display their generosity towards Queensland with our money without these basic questions being answered.

The admirable speed with which Gillard assured Queenslanders that their damage costs would be met reeks of political opportunism.

It’s little wonder that her efforts are now being met with some cynicism from those who initially refused to take up the federal Government’s offer of instant cash for those who had been temporarily without power or had been unfortunately isolated.

Although many have been found to have rorted the system, far more decided that they would honourably abstain from collecting their $1000 - even though they qualified under the extraordinarily loose arrangements - and leave the funds for those most in need.

But since Gillard announced that her flood tax would not apply to those who claimed the initial handout, more who had decided on moral grounds not to take the cash have now put their hands up so they will be excused the new tax.

Our taxes are now paying for Queensland’s complete negligence and incompetence in spending and managing money, as well as for the Federal Government’s failure to make even the most basic enquiries before announcing the release of relief funds.

A very well written article.



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This opposed to fleecing tax-payers in order to recover what really doesn't have to be a nation wide and long felt disaster.

Howard left them a sizeable nest-egg, how thoughtful, now Miss Gillard, where is it?

Or like the surplus you inherited from a more competent and pragmatic Liberal government, have you squandered this too?


Cough it up!

So when digging deep, and donating to the flood/cyclone appeal, this or accepting Gillards welfare cut-backs, bear a little thought to the above, and realise we already have, and that the funding should still be there.

Thank you John Howard, his terror-tax may come in handy for something yet.

Abbott stresses a Labor government is addicted to tax...whereas I think it's more about extortion and opportunism, than addiction itself.

So, equ, are you suggesting we impose another GREAT BIG NEW TAX LEVY after each natural disaster?

Particularly when this TAX cant be justified.

Labors days are numbered, the public have woken up!

Best you put your energy into revitalising an opposition Labor cabinet for the next 8 or so years...and learn from this woeful Labor government who's leaders between them (Gillard/Rudd) could not achieve a full term as a majority government.

Time a Gillard Labor government took responsibility for it's own government, and mistakes.

We pay them dearly to run our country...I for one want a refund!