Australia’s councils to vote on landmark motion calling for big polluters to pay for climate damage

Climate Media Centre Media Release

Local government leaders from across Australia will vote on a landmark motion at the Australian Local Government Association (ALGA) National General Assembly next week, 23–25 June 2026 in Canberra. The motion will be calling on the Federal Government to establish a Climate Compensation Fund, with a Parliamentary inquiry to investigate levies and taxes on the coal, oil and gas corporations to finance the fund. The motion, put forward by the City of Sydney and backed by the ALGA Board ahead of the vote, comes as councils nationwide face mounting climate costs they cannot afford to carry alone.

Australia’s 537 councils are responsible for maintaining a third of the nation’s community infrastructure, valued at nearly half a trillion dollars, yet their revenue base is growing far more slowly than the climate costs they are being asked to absorb. The insured costs of climate-related disasters are now twelve times higher than twenty years ago, while local government revenue has grown only three times over the same period.

Nationally, fires, floods and cyclones cost Australia $38 billion per year, equivalent to $3,800 per household, predicted to rise to $73 billion by 2060. Between 2019 and 2023, more than 80% of Australia’s local councils faced climate-related disasters.

Jess Miller, Deputy Lord Mayor of the City of Sydney, said “Councils, including the City of Sydney, are increasingly feeling the unsustainable financial burden created by responding to more frequent and more severe climate impacts. From storms, flooding and mould, to sinkholes in our roads, to heat stress affecting our residents and the costs of adapting our cities to make them safe. The costs are mounting and something has to change.

“The 2025 National Adaptation Plan creates a mandate for councils to deliver adaptation and emergency management services on top of the frontline services we already provide. But the Government has failed to provide the funds necessary to deliver these critical services. It is an unfunded mandate that is eating away at council budgets and bottom lines.” said Cr Miller.

The motion calls on the Federal Government to establish a Parliamentary Inquiry into the adequacy of the 2025 National Adaptation Plan, create a dedicated funding stream for local governments that matches the scale of financial risks identified in the 2025 National Climate Risk Assessment, and identify taxes or levies on the coal, oil and gas industries aligned with the damage their products cause to finance the fund.

Toby Heydon, Mayor of Mount Alexander Shire Council, said “The fires that affected our communities earlier this year have had a large and ongoing impact for residents, the community as a whole and for the council. These devastating events take a massive toll on wellbeing, household finances and government budgets as we rebuild.

“As disasters become more intense and frequent, the costs will continue to mount, not just for us but for state and federal governments too. Mount Alexander Shire is just one of many councils calling for increased and more sustainable funding for communities to manage these crises. It’s why we supported the City of Sydney motion following our own unanimous council motion in March this year. It’s time for polluters to pay their fair share to clean up disasters they are responsible for, and to help ensure our communities are better prepared for the next one,” Mayor Heydon said.

David Law, Councillor for Division 10 Sunshine Coast Council, said “The Sunshine Coast is not alone in facing substantial financial challenges in the wake of consecutive disasters due to extreme weather events. For example, three severe peak flooding disasters within 46 days in 2025 caused by extreme rainfall cost the council millions of dollars to protect our community and repair infrastructure. 

“As a low-lying, coastal region with an extensive hinterland we face multiple hazards including inundation, coastal erosion, flooding and riverine flooding, land slip and bush fires. As these disasters become more frequent, the costs are becoming increasingly unsustainable.

“A Climate Compensation Fund would provide a fair and practical solution. By requiring major coal and gas corporations to contribute to the costs of climate damage, it would give councils access to a dedicated funding stream for recovery and resilience, and reduce the need for ongoing rate increases,” Councillor Law said.

Prime Minister Albanese is due to address the ALGA National General Assembly on Thursday evening. The motion will be voted on at the first motions session on Wednesday 24 June.