Recovery costs from cyclone
Huge numbers thrown around, expecting Gov't cost to easily exceed Christchurch earthquake's $13 billion.
Added 2 years ago
Very big estimates are beginning to emerge regarding the costs of recovery from Cyclone Gabrielle.
At this writing, around 30,000 claims have been lodged nationwide so far for damage from Cyclone Gabrielle. By comparison, the insurance industry is expecting the previous upper North Island floods to cost it more than $1 billion. For that event, the Insurance Council said insurers have already paid out about $111 million, with around 47,300 claims lodged worth more than $990 million.
Already, the transport ministry, Waka Kotahi, had estimated the damage to roads during just the North Island flooding before Cyclone Gabrielle may cost $1 billion to fix.
For the Christchurch and Kaikora earthquakes damage, private insurers paid out 21 billion and EQC another $10 billion.
Finance Minister Robertson had mentioned surpassing the Christchurch earthquake rebuild cost of $13 billion about a month ago, but economists warn that definitions are important. Immediate recovery costs are one thing, but for the full comprehensive costs of enhancing and future-proofing infrastructure and potentially moving people and businesses out of flood zones, the number would more likely be in the hundreds of billions.
In another interview, Robertson commented that tens of billions spent over the next five years would not fill the gap Cyclone Gabrielle exposed in NZ’s infrasturcture spending. "The deficit is so large, we will not be able to make up for it in the long term," he said, as reported by the BBC.
Federated Farmers estimates total on-farm costs for Gabrielle recovery, including income disruption, infrastructure repair and crop or orchard restoration bills for all affected farmers and growers could top $1 billion. That didn’t include costs to the nation in terms of public infrastructure, food shortages and inflation. Nor does it include stock losses.
Estimates aside, recovery work proceeds, with the Hastings District Council saying it was spending $600,000 a day just on essential local roading and access repairs.
And as of 12 March, MPI said it had paid out more than $18 million, with half of that going to farmers and growers in Hawke’s Bay.
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