Appearing before the Parliamentary Select Committee on Emergency Services Funding Reform today, Property Council NSW Executive Director Katie Stevenson said changes to the current insurance-based levy were needed, but the public deserved a clearer picture of what comes next.
"We support reform and we support lower insurance costs – but every dollar taken off insurance premiums has to be collected somewhere else," Ms Stevenson said.
"The question the Government still hasn't properly answered is who ends up paying."
The Property Council said the Government has yet to release detailed analysis showing what the proposed changes could mean for rents, housing supply, business costs, prices and investment.
"People deserve to know where the ultimate costs will land," Ms Stevenson said.
"They won't stop with property owners - these additional business costs will flow through the economy to businesses and households."
Property Council members have indicated they will face significant and highly uneven impacts under the Government's proposed levy options.
Commercial properties could face, on average and across all options being considered, levy increases of more than 280 per cent, while industrial properties could face increases of 270 per cent.
"When costs go up on warehouses, logistics centres, shopping centres, offices and housing projects, those costs don't just disappear.
"They show up in higher rents, business expenses, supply chain costs and ultimately the prices people pay at the checkout."
The Property Council also called for clear assurances for consumers that savings from the abolition of the current insurance levy would be passed on in full.
"We support reducing insurance premiums and tackling underinsurance," Ms Stevenson said.
"But there's no guarantee that every dollar saved by removing the levy will be passed through to policyholders.
"Before people are asked to pay under a new system, they should be confident they are actually getting the savings they have been promised."
The Property Council said emergency services benefit the entire community and funding arrangements should reflect that reality.
"Emergency services are there for all of us," Ms Stevenson said.
"They respond to road crashes, rescues, hazardous materials incidents, medical assistance and natural disasters, not just building fires.
"The people who rely on these essential services aren't limited to property owners, and the funding model shouldn't assume they are. The model should reflect the broad community benefit these services provide."
Ms Stevenson said the Government's modelling didn't fully address the projected growth in emergency services costs, driven in large part by climate-related pressures.
"Treasury's own analysis shows emergency services expenditure is forecast to rise by 164 per cent in the next 40 years, with climate-related pressures accounting for 41 per cent of that growth.
"Individual property owners cannot meaningfully mitigate those systemic risks. Only Governments have the policy tools, resources and long-term planning capability to address them.
The Property Council has recently launched a public information campaign designed to help people better understand the proposed reforms and encourage a broader discussion about how emergency services should be funded into the future.
"This is too important a reform to get wrong," Ms Stevenson said.
"We support sustainable reform. We support our incredible emergency services. But we also believe in a fair and sustainable funding model that better reflects who drives demand for emergency services, not simply who owns property.
"We need Government to publish its methodology and full distributional and economic-impact analysis. We also need Government to assess a broader funding base involving government, users and landowners." Ms Stevenson said.
