Govt to support councils with buyout and better protection of cyclone and flood affected propertiesCyclone Recovery Finance
The Government will enter into a funding arrangement with councils in cyclone and flood affected regions to support them to offer a voluntary buyout for owners of Category 3 designated residential properties. It will also co-fund work needed to protect Category 2 designated properties.
“From the beginning of this process the Government has supported a locally-led response to the North Island weather events, as requested by councils and communities in affected regions,” Grant Robertson said.
“The facilitation work that the cyclone taskforce has been engaged in to undertake risk assessments has been completed. From here the councils will lead engagement with their affected property-owners.
“Today’s announcement will help councils get the right solution in the right place and avoid significant financial hardship for property owners.”
The Government is committed to providing funding to support councils and will work through the details with them on how that will work in practice for both Category 2 and 3 properties. We expect to have those details resolved in June.
For properties designated Category 2 (where it is determined community and/or property level interventions are feasible to manage future severe weather event risk) the Government will work with councils to help them build flood protection and other resilience measures. The initial support for this is already in place with $100 million initial funding announced in Budget 2023.
People in homes designated as Category 3 properties (where future severe weather event risk cannot be sufficiently mitigated) will be offered a voluntary buyout by councils – the costs of which will be shared between the Government and councils.
Decisions on the details how the voluntary buyout process will work will be made in the coming weeks. This will include the criteria for valuation of Category 3 properties, the split of costs between councils and central Government and the treatment of uninsured properties.
“The focus of today is on residential properties. We are working with sectors, such as the horticulture sector on possible targeted support for commercial operators, and on regional plans that will provide overall support for recovery and rebuild,” Grant Robertson said.
A parallel process is also underway to engage with Māori, including on appropriate processes for whenua Māori. Engagement with those communities will be led by the Cyclone Response Unit, Te Arawhiti and local councils. The process will ensure that there are equitable outcomes for these communities.
“The Government welcomes announcements from councils in Hawke’s Bay setting out which properties are in Category 1 and indicative assessments of which are in Categories 2 and 3.
“Our understanding is Auckland Council will be talking to property owners from June 12 and Tairāwhiti has already begun contact with property owners in Category 3, with the remainder to be finalised over coming weeks,” Michael Wood said.
“It is also important to note that there may be some properties in other cyclone-affected regions like Northland and Wairarapa that are designated as Category 2 and 3. The Government will support councils in those regions in the same way.
“Initial indications are that across all regions there will be about 700 Category 3 properties, and up to 10,000 homes in Category 2 areas,” Michael Wood said.
“The weather events saw property damaged across multiple areas of the North Island. There is no precedent for the response required, but we do know that with climate change there will be more events like this in the future,” Grant Robertson said
“The Government is committed to assisting local councils to find solutions for those who have been affected. As I have said many times we cannot meet all the costs, particularly knowing that we will see more extreme weather events like this.
“As a Government we have to strike a careful fiscal balance between supporting affected communities and not making all tax-payers bear the cost. But the affected communities can be assured we are committed to making this approach work.”