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Cost of fire prevention under question

Date

Marian Borges and Peter Martin

AUSTRALIA spends too much trying to prevent fires, according to a controversial study by an insurance researcher.

Conceding that the findings for such a ''sensitive'' matter might upset some and anger others, Brian Ashe said an analysis of the $12 billion in annual funding for fire prevention backs his case.

Dr Ashe works with the insurance industry-funded Risk Frontiers centre at Macquarie University. He gained his doctorate studying the cost of fire.

Writing in the Australian National University journal Agenda he says the total cost of fires in Australia amounts to about $18 billion per year, of which $11.9 billion is fire prevention and $4.4 billion is fire response.

The cost of injury, lost lives and lost property amounts to only 9 per cent of the total - $1.7 billion.

Australia's fire fatality rate is "already low by international standards" at 0.6 deaths per 100,000 of population and has proved "resistant to increasing expenditure on fire management and protection".

Dr Ashe surveyed 26 fire professionals and found that none believed further spending would result in a net economic gain. All but four believed Australia would be better off if it spent less on attempting to prevent fires.

"This is a very sensitive matter and, really, what we're looking to get is the best out of our investment," Dr Ashe told Fairfax Media.

"We just have to be careful that we don't put too many resources into one hazard."

Dr Ashe said if $4.5 billion of the money spent on fire safety was returned to businesses and consumers as tax cuts, health and nutrition would improve, thereby saving lives. His modelling suggests such tax cuts would save between 90 and 225 lives per year, which coincidentally is close to the total number of lives lost to fire each year.

"When you take money out of the economy or out of people's pockets there is an impact in terms of their health and safety," Dr Ashe said. "I don't know where the balance is, but I think it is a debate that needs to be had. You can't keep throwing money at an issue; you need to be a bit more sophisticated about it."

Dr Ashe believes the media's coverage of fires fans perceptions of risk. A study he completed after the 2009 Victorian bushfires showed a jump in estimates of the risk of death from fire were exaggerated, something he blames on the reporting.

"What happens all the time is events like this occur, there's demand for more resources and generally more resources are provided."

About 114 lives are lost each year from fire, 14 of them from bushfires.

Nicholas Gruen, a former presiding commissioner at the Productivity Commission, said he was uneasy applying cost-benefit techniques to fire prevention.

A spokesperson from the Attorney General's department said the government made "no apology for investing in the protection of lives".

33 comments

  • --- A spokesperson from the Attorney General's department said the government made "no apology for investing in the protection of lives". ---

    Just goes to show how easily the government will pull the wool over people's eyes. It can waste billions of dollars, and brush away in-depth studies in one sentence. Finishing off the article with that just highlights how easily people are influenced by the mighty "public safety" excuse.

    Commenter
    Cameron
    Date and time
    January 21, 2013, 8:24AM
    • It's not just the government, media plays it's role in over hyping tragedy and making it look like the government is not doing enough to protect people from fires.

      Commenter
      Nathan
      Location
      Melbourne
      Date and time
      January 21, 2013, 9:18AM
    • The point is, if the $12bn spent preventing fires was halved, we could almost fund NDIS.

      But why should Labor care about avoiding waste when it's just taxpayers money they're spending? If they run out they can just increase taxes to get more money to fritter about, or cut more family payments.

      It's disappointing the journalist didn't bother to tell us where the $12n goes.

      Commenter
      Gatsby
      Date and time
      January 21, 2013, 9:35AM
    • AG's comments are a typical sound bite of the Government today. The real issue is waste, the learned professor wants tax cuts but when you compare the state of Health and Education spending then it should be more about waste or inappropriate allocation of funds, firefighters are struggling too the CFA has had to endure budget cuts like every other government agency!

      Commenter
      Dino
      Location
      Melbourne
      Date and time
      January 21, 2013, 9:53AM
    • Australia also spends more than $20billion a year on the military. Might as well save that money as well. It's not as anyone has tried to invade the place lately, and if they did, it would only take them a few days.

      Commenter
      The Other Guy
      Location
      Geelong
      Date and time
      January 21, 2013, 12:01PM
    • To suggest that the money would be better spent in tax cuts is ludicrous and demonstrates a level econominc illiteracy. As soon as tax cuts are provided, inflation rises and the anticiapted benefits are eaten up in higher living costs.
      For me this oversite on Dr Ashe's part calls into question the validity of his arguement.

      Commenter
      Bushy
      Location
      the Bush
      Date and time
      January 21, 2013, 12:05PM
  • Next thing you know is that someone will do a cost-benefit analysis of all the "security" since 11/9/2001 and figure out that most of it is a total waste of money that has created a new unproductive industry that just weighs down the rest of the economy.

    Amazing how a certain political segment constantly bang on about "red tape" strangling the economy but are always making things tougher with ongoing and increasing "security" costs that basically just pander to the vested interests of that industry, isn't it?

    Commenter
    DC
    Location
    Melbourne
    Date and time
    January 21, 2013, 8:30AM
    • Already been done mate. Saul Eslake, the well-known economist, has been banging on for years about what a waste of money the post 9/11 security is.

      Commenter
      Bam Bam
      Location
      Bedrock
      Date and time
      January 21, 2013, 9:00AM
  • Dr. Ashe talking about bushfires, he was destined to this role from an early age.

    Commenter
    Gerry Gerry
    Location
    melbourne
    Date and time
    January 21, 2013, 8:33AM
    • +1

      Commenter
      jongle
      Date and time
      January 21, 2013, 9:12AM

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