The Snowy and South Coast regions have borne the brunt of the economic impact of the bushfires, as communities struggle to recover nearly six months on from the crisis.
Subscribe now for unlimited access.
or signup to continue reading
Modelling undertaken by Ernst and Young for the National Bushfire Recovery Agency indicates there will be a $3.6 billion hit to areas impacted by the devastating Black Summer fires.
The tourism and hospitality sectors were predicted to cop the worst of the damage, with $1.9 billion in estimated losses. The agriculture industry was expected to take a $1 billion hit, with $700 million in losses expected for the forestry sector, too.
Eighty per cent of the economic losses were concentrated in just 30 local government areas.
The Shoalhaven area was expected to suffer the largest economic losses, predicted to be $345 million. Ernst and Young estimated there was a 40 to 70 per cent downturn in tourism over the summer due to evacuations, with a potential 5 to 15 per cent fall in the long term.
It was also expected there would be three years of declining dairy product output, linked to the proportion of the herd killed during the bushfires. Up to 4 per cent of dairy product was expected to be lost in 2020 due to contamination and dumping.
In the Bega Valley losses were predicted to hit $218.9 million, while in Eurobodalla the economic impact was tipped to be $150.3 million.
Around 80 per cent of forestry areas in those local government areas burnt during the fires. While 20 to 30 per cent of burnt timber can be salvaged, the value of burnt timber is 10 to 20 per cent of the original price. Production at the Eden Timber Mill was expected to be 0 per cent for 12 months.
Bega Valley and Eurobodalla also lost 70 to 100 per cent of their tourists over two weeks in January due to evacuations. There was a downturn for the rest of the summer of 40 to 70 per cent, while a decline of 20 to 40 per cent was expected for the rest of the year.
In the Snowy Valleys, the impact was expected to be around $188.7 million. Approximately 50 to 56 per cent of forestry assets were lost and there was expected to be a fall in agricultural production of 45 per cent for one year. The agricultural downturn was expected to continue for another seven years, with a 22 per cent fall in output for the next four years and a 17 per cent decline for the following three years.
Ranked in terms of the percentage of the economy affected by fires Kangaroo Island was worst-hit, with 46.1 per cent of the economy impacted. Snowy Valleys also suffered greatly, with 2.3 per cent of the economy affected.
When measured in terms of a severity index, the Eurobodalla Shire came out hardest hit with a score of 97.1. Bega Valley (91.3) and the Snowy Valleys (91.1) ranked second and third while Shoalhaven came fourth (90.1).
These regions also suffered from indirect affects of the fire. Ernst and Young's analysis shows Bega Valley copped a $138.78 million direct hit to its economy, and a $59.81 million indirect effect. This excludes the losses of the forestry industry.
Snowy Monaro received a $109.7 million direct hit and $35.22 million indirect hit, while Eurobodalla received a direct impact of $105.6 million and an indirect impact of $34.31 million.
The data, which was tendered to the Royal Commission into National Natural Disaster Arrangements, only captures the 96 local government areas that were declared under Commonwealth and state disaster funding recovery arrangements at the time.
National Bushfire Recovery Agency coordinator Andrew Colvin said this week, there were now 111 areas declared.
It comes amid a debate over whether supports have been adequate for bushfire-affected communities.
Mr Colvin this week told the royal commission there were jurisdictional inconsistencies in the way the Disaster Recovery Funding Arrangements worked.
"The reality is that there are differences across jurisdictional boundaries and the experience of an Australian recovering from this event can vary depending on which side of an artificial line that you sit," Mr Colvin said.
"I'm not just talking about state lines, it can also vary at times from local government boundaries as well. There are embedded inconsistencies in our framework that only become an issue and a concern if the disaster crosses jurisdictional boundaries, which doesn't happen a great deal."
Emergency Management Minister David Littleproud announced a review of the arrangements on Wednesday.
But John Watkins, president of the Bega Chamber of Commerce and Industry, said the supports offered to businesses had been "fantastic".
"It has been such a massive bushfire season, it would have been impossible to give intimate help to every business that suffered from it. The government is doing the best they can," Mr Watkins said.
However businesses in the area were reeling to recover. While the town of Bega itself - which has been the epicentre of the bushfire recovery effort in the region - had seen an uplift in business, all the surrounding districts had suffered "big losses", Mr Watkins said.
"Quite a handful of businesses in Merimbula specifically have closed down, and we're not expecting them to reopen," Mr Watkins said.
There was a silver lining though, with coronavirus restrictions now easing.
"It's interesting this weekend most accommodation places are booked out, which is pretty unusual for a June long weekend. Merimbula is bustling today," Mr Watkins said.
"Hopefully this will be our best winter season yet."
