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Dam pitch

In the lead up to her Western Sydney visit, the Prime Minister has caused a political stir with a funding proposal to raise the Warragamba dam.

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Premier Campbell Newman has accused the Prime Minister of putting votes in western Sydney above the needs of Queensland's flood-prone communities.

Prime Minister Julia Gillard announced up to $135 million in flood relief funding for Queensland on Thursday morning, with some of the funding aimed at reducing insurance premiums.

Prime Minister Julia Gillard with Veronica Voigt of Laidley, which has been affected by recent flooding.

Prime Minister Julia Gillard with Veronica Voigt of Laidley, which has been affected by recent flooding. Photo: Harrison Saragossi

Mr Newman criticised her decision to spend $50 million of the flood mitigation money on raising the Warragamba Dam in NSW, leaving $50 million for the rest of the country. 

Roma will get $7 million of the $50 million to build a levy in the flood prone town which comes a month after after residents pleaded with the federal government for money.

The state government has already pledged $13 million to the $20 million project and Suncorp has conceded insurance premiums in the area would be more than halved if a flood levy was built.

Prime Minister Julia Gillard announces the flood assistance package in Ipswich.

Prime Minister Julia Gillard announces the flood assistance package in Ipswich. Photo: Harrison Saragossi

“This decision will break the hearts of communities across Queensland which have regularly rebuilt their towns and lives after flooding," Mr Newman said of the decision to spend $50 million in NSW.

“The people of Gympie must be wondering how much suffering they need to endure before the Gillard Government puts their livelihoods before votes in western Sydney."

Ipswich has been promised $10 million of the flood mitigation funding and the remaining $33 million has not been announced.

Veronica Voigt, from the flood-affected town of Laidley, embraces Julia Gillard during the Prime Minister's visit to Ipswich west of Brisbane.

Veronica Voigt, from the flood-affected town of Laidley, embraces Julia Gillard during the Prime Minister's visit to Ipswich west of Brisbane. Photo: Harrison Saragossi

In a separate package, the federal government is making a $40 million contribution to a betterment fund for Queensland, and is asking the Newman Government to match the figure dollar for dollar.

Mr Newman's office said they would match the money but had initially asked the Federal Government for $100 million for a betterment fund, which they would have matched dollar for dollar too.

The betterment fund will be spent on building flood damaged infrastructure to a better standard so it is less at risk of being swept away again.

Prime Minister Julia Gillard makes a coffee at the Cactus Espresso Bar in Ipswich.

Prime Minister Julia Gillard makes a coffee at the Cactus Espresso Bar in Ipswich. Photo: Harrison Saragossi

"We're hoping the funding can help us end the cycle where some road is washed away, a local facility is hit, it is fixed, and floods come 12 months later and it is is flooded or damaged again," Ms Gillard told reporters in Ipswich.

The Prime Minister said the betterment fund was pitched at local governments because they dealt with a lot of flood damage, but had the least ability to boost to their revenue.

A third package of $45 million will go towards Queensland's primary producers and small businesses, as well as funding post-flood counselling and environmental recovery programs.

"It's not just the mental anguish that comes with dealing with floodwaters but when you hear heavy rain everyone gets a sleepless night because you're worried about it flooding again," Ms Gillard said about the counselling funding.

An unspecified part of the flood recovery money will go towards fixing any damage to the Great Barrier Reef and the funding will also help councils pay for day-labourers to do reconstruction instead of costly contractors.