Be prepared – climate change risks

Risk Matters - Autumn 2022

Photo courtesy of DFES Incident Photographer, Evan Collis

The recent Intergovernmental Panel on Climate Change (IPCC) report stresses the time to act on climate change is now, and there is much work to be done – including by local governments.

Australia is no stranger to unpredictable or extreme weather.
In recent years, we’ve seen more heatwaves, bushfires, coastal erosions, and other extraordinary environmental events like the recent devastating floods in Queensland and NSW.
These events can impact us in more ways than one, presenting risks to health, infrastructure – and your local government’s longterm plans.

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What's the latest?

The IPCC’s report finds the impacts from climate change threaten to overwhelm our ability to adapt in the coming decades, with some impacts requiring rapid and radical transformations in how we live and operate.

Current global policies put the world on course of warming at least 2.1C by 2100, and possibly as much as 3.9C.

Regional and urban areas will face irreversible changes that will impact millions of people’s lives, including:

  • Extreme events (heatwaves, droughts, floods, storms, fires) resulting in death and injuries, and placing pressure on
    emergency and essential services and infrastructure.
  • Sea level rises that will destroy infrastructure
  • Weather patterns that will lower the productivity of both crop farming and livestock in many areas

As climate change intensifies, we see compounding impacts and risks, including where extreme events coincide.

The impacts of these events on cities and towns, roads, supplychains and services is extreme. Think of the rolling impacts from the Black Summer bushfires, which killed people and wildlife, destroyed property and resulted in major economic losses. This places even greater pressure on the ability to respond. The 2019/20 south-eastern fire impact came to approximately $2.3b insured losses across Australia.

Climate risks

Risk is determined by the interactions between hazard, exposure, and vulnerability. As history tells us, climate hazards can be acute or chronic. The exposures around climate include people, livelihoods, ecosystems, environmental services, infrastructure, and economic, social, and cultural assets. The vulnerability is the likelihood of being adversely affected and looks at how sensitive or susceptible the exposures are to harm, and the capacity (or lack thereof) to cope and adapt.

Adaption and mitigation go hand in hand for climate – adaption is the life jacket and is necessary for mitigation to be successful, however there cannot be one without the other – they are complementary factors.

What are the implications for local government?

As leaders of their communities, local governments bear the social, moral, and official responsibility to ensure their communities are well protected. This includes supporting businesses and residents by proactively considering climate
change risks in your current and future developments.

If left unmanaged, climate change can impact local governments in various ways, including:

Damage to infrastructure and built assets
From buildings to drainage, climate change causes continual physical damage to assets above and below ground. This leads to additional maintenance costs, increased risks to health and safety, and even potential liability due to inadequate planning.

Resident migration
As climate change worsens with frequent flooding or bushfires, poor quality housing in affected areas may not be able to withstand these events.

Coastal erosion is also of increasing concern. In 2019, the WA State Government commissioned a state-wide assessment of
the extent and scale of coastal erosion in WA. The assessment identified 55 coastal erosion hotspots (15 in the Perth metropolitan
area and 40 regional) spanning 29 local government areas. An additional 31 locations (8 metropolitan, 23 regional) have been placed on a watch-list for future monitoring and investigation.

Increased temperatures may turn outdoor spaces like local parks into a safety hazard too. And without a long-term solution for these possibilities, people in your local government may start moving away to find better living conditions.

Financial impact
Local governments may have reduced rate revenue as businesses are disrupted or unable to operate during extreme weather conditions. There’s also the increasing cost of risk and insurance to consider, as well as large clean-up costs following extreme weather events.

Reduced operations
Your own staff and infrastructure may be affected by extreme weather events. And in these situations, your operations may be disrupted, leading to reduced productivity.

Other areas climate change can impact your local government:

  • Loss of amenity and function of land
  • Increased emergency management responses to events
  • Loss of natural environment
  • Development and planning concerns along coastal and low lying areas
  • Increased demand for health services especially within vulnerable community members
  • Asset management issues for sites vulnerable to exposures

We mentioned that often climate change liability risk to local governments emanates from planning decisions. This is true, but more specifically liability arises because of:

  • a failure to adapt to climate change risk in the development of local planning schemes and policies;
  • adopting adaptation and mitigation strategies that do not take account of the latest scientific knowledge and technical
    expertise relating to that particular local government environment, and, most importantly;
  • the inadequate, or non-disclosure of hazard information to the local community exacerbated by the effects of climate change.


What can you do?

While no doubt the brunt of change needs to be at a Federal and State government level, it’s important for local governments to
commit to developing climate policies and strategies to mitigate global warming.

Climate change is a strategic risk with impacts across all areas of your local government’s responsibilities. There is also an added expectation that you should already be considering these impacts in your strategic planning, development, infrastructure,
and community decisions. This includes practicalities like making sure all strategic planning, land use planning, and infrastructure developments take complex climate change risks into account – in a systematic, rather than siloed way. Place-based planning, especially coastal adaption, is of huge importance for local governments to direct their energy. Not doing so is a large reputational risk.

Risk management should inform your decision making – to allow you to anticipate, understand, prioritise and adapt to your local conditions. LGIS can assist in this process in several ways, including:

  • Interpreting relevant and credible international, national, state, regional and local scientific climate change data to determine local climate change scenarios
  • Assisting the development and understanding of your strategies, services and functional areas that may be impacted by climate change
  • Providing education and awareness on climate change issues, impacts and expectations
  • Identifying and assessing your risks and vulnerabilities
  • Identifying adaptation options that align to your strategic direction

Climate change risk assessments

When you understand the climate scenarios and what your local government might be exposed to (currently or in the future), you are better placed to make informed decisions and strategies.

Using data relevant to Australia and your specific local government, a climate change risk assessment will help you:

  1. Understand and identify the potential risks (whether it affects your people, assets, finances or community as a whole)
  2. Categorise the risks according to severity (low, medium, high or extreme)
  3. Determine if the risks need to be addressed immediately
  4. Develop and implement risk adaptation strategies

It’s important for all councils to perform climate change risk assessments – regularly. Depending on when you did your last assessment, we may recommend that you consider reviewing it.

There are several reasons for this:

  1. The data used for climate change risk assessments changes every 5-10 years.
  2. Your local government may have gone through big changes through the years, whether in management, structure, resources and capabilities.
  3. Up-to-date assessments also give you the chance to be aware of what’s going on in the market, community and industry – especially useful before you invest in a large development.
  4. Having a current risk assessment can open doors to government grants that will help fund your adaptation strategies.

An example of how climate change risk assessments can benefit your local government:

Your local government is planning to build a playground, but through climate change projections, you find the area has a high risk of increased temperature. This in turn may damage play equipment, or cause heatstroke and injury to children and families using the facilities. This risk projection allows your council to mitigate the issue by relocating the playground development to another, more suitable area. It also allows you to put in plans to use materials that can withstand high temperatures. Climate change risk assessments are crucial in enabling you to make better long-term plans and decisions – and ensuring that you spend your funds wisely.

To discuss your climate change risks, please contact the LGIS risk services team on 9483 8868 or your regional risk coordinator, or to discuss your policy protection, please contact your LGIS member services account manager directly.

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