All must share fire cost burden

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THE Victorian Government expects to cream an estimated $225 million in stamp duties off household and business property insurance this financial year.

The reality is the insured are paying the full cost of running the fire services.

Fire services levies on property insurance will cover 77.5 per cent ($303.2 million) of the CFA's statutory budget this financial year and 75 per cent ($206m) of the MFB's budget.

The remainder of the CFA's budget and 12.5 per cent of the MFB's budget are meant to be covered by what is erroneously called the State Government contribution.

Yet while the Government hands over $122 million as its contribution, it collects another $225 million in stamp duty on the insured.

This means the insured are not only covering the costs of running the fire services, but pouring an extra $100 million into the Government's coffers.

Meanwhile, those 20-25 per cent of Victorians who grossly underinsure or don't even bother to insure their homes and businesses contribute little if anything.

As the Victorian Farmers Federation argues, the inequitable fire services levy and taxes need to be replaced with a scheme that ensures everyone pays.

Continuing with the current scheme could force more people to abandon insurance or underinsure their properties.

Let's hope the royal commission examines this inequity and asks whether the high cost of tax on insurance was a factor in the higher-than-expected number of uninsured homes lost in the Black Saturday fires.