28 Jan 2011

Australians urged to pull together to pay for floods

1:02 pm on 28 January 2011

Prime Minister Julia Gillard urged Australians to "pull together" as she began the task of selling her proposed flood levy on Friday morning.

Ms Gillard told ABC Radio that Australia was still in the grip of "a natural disaster of unprecedented economic proportions" and appealed for support from those who will be affected by the levy.

From July, most Australians will pay between $A1 and $A5 per week in extra income tax. It will last 12 months and will be finished long before the next election.

Parliament returns in the second week of February and the ABC reports Ms Gillard will be working hard in the days ahead to convince the Greens and the independents the flood levy is the right way forward.

"I think Australians around the country realise this is a time where we need to pull together," she said.

"We are seeing a natural disaster of unprecedented economic proportions still unfolding in our country. We have still got floodwaters rising in parts of Victoria.

"Yesterday's package, yes it has got a levy, and I think Australians around the country will want to help in these times.

"It has also got spending cuts. If you actually look at the balance... there is $A2 in spending cuts and reprofiling of infrastructure compared with $A1 in levy in this package."

Ms Gillard said the levy would only apply for one financial year and the Government would make more spending cuts if it needed more money for flood recovery after that.

But she admitted there was a risk that the flood recovery bill would be more than the estimated $A5.6 billion.

"We have already made major budget cuts in this package and if we need to do more then we will."

The ABC reports the Opposition is vowing to vote against the levy so the Government will need the support of the Greens and independents, some of whom want the Government to set up a permanent disaster relief fund.