The Disaster Recovery Funding Arrangements (DRFA) is a way through which the Australian Government provides funding to states and territories to share the financial burden of responding to a disaster.

This cost sharing arrangement between the Commonwealth and the states and territories supports the delivery of urgent financial assistance to disaster affected communities. 

State and territory governments are best placed to identify the type and level of assistance to make available to their communities following a disaster. This is part of their responsibility for disaster and emergency management. 

Disaster recovery funding assistance is delivered through state and territory agencies, which are:

• ACT
• NSW
• NT
• QLD
• SA
• TAS
• VIC
• WA

DRFA cost-sharing arrangement

Under the DRFA, four categories of assistance measures can be activated to support communities. Once the DRFA is activated, the government may reimburse states and territories up to 75 per cent of the financial assistance provided. 

The DRFA allows state and territory governments to activate certain relief and recovery assistance under Category A and B immediately following a disaster without seeking approval from the government. 

Under these arrangements, the states and territories determine the type and level of assistance to make available. Importantly, jurisdictions are not bound by the assistance available under the DRFA. They can make available whatever assistance is considered necessary, regardless of whether it’s eligible for cost sharing under the DRFA.

This contribution may be delivered through a number of eligible assistance measures including:

• personal hardship and distress assistance
• counter-disaster operations
• concessional loans or interest subsidies for small businesses and primary producers
• transport freight subsidies for primary producers
• loans and grants to voluntary non-profit organisations and individuals in need
• the reconstruction of essential public assets

Funding can be provided as a financial reimbursement or an advance payment. Advance payments are generally only made in response to significant and extremely damaging disasters, and where the cost is likely to be greater than the state and/territory can manage in the immediate to short-term.

The DRFA operates as a financial safety-net when frequent and/or severe disasters occur. As the cost of providing assistance to disaster affected communities increases, so too does the level of financial support from the Government to the states and territories. 

Standardised recovery packages

Standardised recovery packages may be requested by a state or territory if there is a demonstrated need for them. They are relevant to the three recovery domains:

• social
• built
• economic.

Each of the packages (listed below) is subject to a request being made by the state and approval by the Prime Minister. 

Infrastructure betterment package (improving public assets after disasters)

Infrastructure betterment is where damaged public assets are restored or replaced to be more resilient in the future. This saves recovery costs in the long run. 

It also assists in other ways, including helping:

• communities stay connected
• important services keep going
• reduce damage in future disasters.

Here are some examples:

• building a bridge higher to avoid floods
• adding more drains to roads
• changing dirt roads to sealed roads.

Primary producer recovery grants package

Grants may be made available to primary producers.

These grants help:

• lower disruption in affected areas
• primary producers recover by contributing to recovery costs.

Grants can be used for:

• fixing buildings
• getting rid of damaged materials
• replacing damaged machinery, crops, plants and fields
• helping injured livestock.

Small business and not-for-profit organisation recovery grants

Grant may be made available to small business and not-for-profit organisations.

These grants can help them to continue, or start again, as soon as possible after severe disasters. 

The grants can be used for clean-up and reinstatement activities including:

• safety inspections
• building repairs
• cleaning equipment
• purchasing, hiring or leasing equipment or material for cleaning up
• employing workers to clean the premises or equipment
• materials needed to resume trade
• disposing of debris and spoiled stock.

Legal recovery assistance package 

Legal problems can arise immediately after disasters. These legal problems include matters such as:

• housing and tenancy
• insurance claims
• superannuation
• credit and debt
• consumer rights
• property damage
• bankruptcy and estate planning
• financial hardship and access to emergency funds
• fencing disputes
• social security entitlements
• employment
• access to bank accounts and proof of identity
• domestic and family violence
• family law.

The legal recovery assistance can provide timely, effective legal assistance following a disaster. This helps reduce the impact of legal problems and the associated likelihood of more psychological, or financial, trauma. 

Mental health and well-being recovery package 

Natural disasters can impact mental health. Mental health interventions can improve resilience and psychosocial wellbeing. They can provide individuals, families and communities with resources that improve the short, medium and longer-term capacity of individuals and communities to recover.

National advisories

In addition to the standardised recovery packages above, a series of national advisories have been developed; these cover:

• resilient infrastructure – guidance on how Category B and Category D (via infrastructure betterment) can be used to help generate greater investment in disaster resilient infrastructure
• clean-up and debris removal – guidance on eligibility and evidentiary requirements for expenditure relating to debris removal and clean-up activities after an event
• emergency and temporary accommodation – guidance on providing assistance for displaced individuals and families in the form of appropriate emergency and temporary accommodation options. 

Where appropriate, the advisories include advice on DRFA eligible activities and evidentiary requirements for audit, assurance and claiming purposes. 

Evaluation guidance for DRFA programs

As part of the DRFA Review a guidance document has been created. It aims to assist state and territory program managers to plan, monitor and execute evaluation activities. It can be applied broadly to activities within and outside of the DRFA.

Access the Evaluation guidance for Category C programs (PDF 537KB).