The way Victoria’s Country Fire Authority is funded is unfair and should be changed, according to the state’s National Party.
The Nationals are pushing for a review of the fire services levy which property owners pay as part of their fire insurance premium.
The levy comprises 26 percent of country Victorians’ premiums and can raise their insurance premiums by up to 68 per cent. The government recently announced a 5 per cent increase in the levy.
The money the levy raises goes to the CFA. More than 77 per cent of the authority’s total annual expenditure comes from insurance companies, with the Victorian Government contributing the balance of 22.5 per cent.
After the February bushfires, it became apparent about 30 per cent of houses lost were not insured.
Nationals Leader and Showdow Miniter for Bushfire Response Peter Ryan said Victorians who failed to insure their properties against fire were not contributing to the upkeep of the CFA.
"You have 100 per cent of the population being able to access fire services but only about 70 per cent of the people are paying the fire insurance levy," he said.
Mr Ryan has written to the Henry Review of Australia’s taxation system, a federal inquiry, and the Bushfires Royal Commission asking for the Fire Services Levy to be reviewed.
He said a Victorian Liberal Nationals Coalition in government would review the existing arrangement and implement a fairer system.
The levy was essentially a tax on insurance premiums to fund fire services, including the CFA, and meant people who insured their home against fire paid for those who did not.
"There are other fairer models in other states which more evenly distribute the cost of funding fire services," Mr Ryan said.
"It is vital that the CFA gets proper funding, but the question is how best to do it."
The Insurance Council of Australia welcomed Mr Ryan’s moves, saying the current system place an unfair and inappropriate burden on insurance.
"The combined effects of the Victorian fire funding system, state stamp duty and the GST can add up to 50 per cent of the cost of a residential general insurance premium in Victoria." the council said.
Echuca Fire Brigade captain Paul Nicoll said it was important for people to insure their properties so they could replace losses through their insurance companies.
Last year, the brigade attended more than 20 fires involving buildings, including two houses and a church hall.
"Most of the properties we attend are insured, though sometimes the contents aren’t" he said.
"We will always attend a fire whether the property has insurance cover or not."
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