Research by SECCCA with the CSIRO has identified infrastructure and communities vulnerable to climate change impacts in the region and associated financial risks to councils. However, there are gaps in understanding how to deal with these risks. In particular, analysis of short, medium and long term adaptation responses is not yet embedded in council financial planning, even though there are significant financial implications to councils and communities for when these responses are made. This project will examine and assist councils plan and budget for future adaptation requirements.
Aims & Desired Outcomes
Help your Council identify and reduce the financial risk caused by the changing climate.
This program is funded by the State Government of Victoria.
Financial Risk Adaptation Planning: Bushfires, floods, heatwaves and severe weather events all place significant pressure on Council resources, from immediate response to the final recovery.
An unexpected severe weather event can have significant and long-lasting impacts on a Council’s budget with the only option for recovery being a rate increase or reduction in service delivery. Is this a sustainable approach?
Further, what about the less noticeable cumulative impacts of the changing climate on Council assets such as roads, drainage, reserves and community buildings, the planning considerations for coastal areas, or the impacts on the outdoor workforce?
The Financial Risk Adaptation Planning (FRAP) Initiative helps Councils integrate climate-related risk into corporate risk assessment processes and prepare financially for the less obvious impacts of climate adaptation.
The FRAP Initiative has developed a risk assessment and financial analysis framework that helps council risk managers and planners understand and build capacity to manage budgetary risks from climate change responses.
Specialist economic consultant Marsden Jacob Associates was appointed to work one-on-one with each of the eight Councils in the South East Councils Climate Change Alliance (SECCCA) to complete the initial pilot project.
Most Councils are on a different stage on the continuum of climate change adaptation planning and risk management, so a tailored approach was taken beginning with a review and update of each council’s current climate change risk assessment.
One risk was chosen by each Council as a case study and Marsden Jacobs undertook a financial analysis to identify the most suitable adaptation option. A detailed report was presented to each of the Councils based on their case study.
PROJECT: Financial Risk Adaptation Planning (FRAP)
START / FINISH: 2014/ 2016