Australian finances take massive hit from climate change

Font Size:

The financial cost of extreme weather in Australia has more than doubled since the 1970s and, according to a new report, inaction on climate change is only going to cost Australians more money in the future.

In recent times, we have suffered through a crippling drought, continued mass bleaching of the Great Barrier Reef and the devastating Black Summer bushfires, all of which have served to highlight Australia’s vulnerability to climate impacts.

The Climate Council’s Hitting Home: The Compounding Costs of Climate Inaction report explains that extreme weather events in Australia have cost $35 billion over the past decade and Professor Will Steffen believes things will only get worse in the coming years.

“There is no doubt that we have entered an era of consequences arising from decades of climate inaction and delay,” Prof. Steffen explained.

“And it is going to get worse. By 2038, extreme weather events driven by climate change, as well as the impacts of sea-level rise, could cost the Australian economy $100 billion every year.

“Australians are five times more likely to be displaced by a climate change-fuelled disaster than someone living in Europe. In the Pacific, that risk is 100 times higher.

“No developed country has more to lose from climate change-fuelled extreme weather, or more to gain as the world transforms to a zero-carbon economy, than Australia does.”

According to the report, 2019-20 ushered in a new and dangerous era of megafires that ravaged not only Australia, but Brazil, Siberia and the US west coast.

Climate change hazards affected six times more people in the Asia-Pacific region than in the rest of the world combined, according to the data in the report, and current projections suggest that all of Australia’s and the world’s tropical coral reefs will be eliminated due to climate change.

The former United Nations secretary general’s special representative for disaster risk reduction, Dr Robert Glasser, said the financial impact of climate change on Australia would also come indirectly from our neighbours in the region, who are more acutely vulnerable to the effects of climate change. 

“The regional impacts of climate change will profoundly undermine Australia’s national security,” Dr Glasser explained.

“Unlike most other wealthy countries, Australia is in a region with many densely populated, near-neighbour developing countries that are highly vulnerable to climate change.

“Because many climate impacts are already locked-in, we must learn to live in a new era of drought, floods, and megafires,” he said.

“It’s equally clear that far greater dangers lie ahead if we fail to act with the urgency and determination that the science demands.”

The report explains that past inaction means current emissions targets do not go far enough to combat the effects of climate change and states that global emissions will need to halve over the coming decade with net zero emissions by 2040 at the latest.

Last year, the Natixis Global Retirement Index listed climate change as one of five issues that could present the greatest threat to retirement security.

According to the Natixis report, worsening air pollution poses greater health and safety risks for vulnerable retirees, including chronic cardiac and pulmonary illnesses.

It also explained that the financial impacts of climate-related disasters, including higher insurance costs and growing food expenditure, would hurt retirees in the coming years.

Are you worried about the financial implications of climate change on your retirement? Should the government be doing more to address climate change?

If you enjoy our content, don’t keep it to yourself. Share our free eNews with your friends and encourage them to sign up.

Join YourLifeChoices today
and get this free eBook!

By joining YourLifeChoices you consent that you have read and agree to our Terms & Conditions and Privacy Policy


Financial planning costly and complicated, say review submissions

Financial planning review leads to calls for … a financial planning review.

How SMSFs invested in 2020 - and what this means for 2021

Investment specialist Chris Brycki analyses what happened in the SMSF sector in 2020.

Five smart moves for empty nesters

The absence of adult children can mean big savings for the household.

Written by Ben


Total Comments: 23
  1. 9

    Total Tosh. Every prediction regarding climate change over the past 40 years has proven to be wrong. Tim Flannery to name one. No-one has yet explained the cost of reaching zero emissions in 2050, try asking Bill Shorten. And no-one dares explain what difference Australia can make to climate change. The two biggest emitters of Carbon are China and India and they have no intentions of doing anything before 2060. The climate change movement has now become a religion with people like millionaire Al Gore leading the mob and the major commentators appear to have vested interests. Lots of rhetoric but no substance.

  2. 9

    When has the Climate never changed ? This report is the biggest load of BS written and the insurance companies read to pump your insurances up Well here is a news flash in the next 10 years Australia will have a flood and a bushfire as well as a drought it’s called mother Nature

  3. 5

    Fact- Nothing Australia’s small population does will make any difference to global warming. With big populations like China and India pumping out carbon emissions ours are like a drop in the ocean.

    We need leaders who will not sacrifice our people and economy but instead do things that will benefit Aussies.

  4. 4

    All the conspiracy & pro gas & coal idiots will now be posting that it’s all BS. They will also proclaim than we as a nation will have no impact & countries like China, India, Russia etc aren’t doing anything as far as emissions go. They need to read up on scientific reports from those scientist that actually are involved in climate change instead of listening to politicians & non experts opinions.
    Mother nature has been using renewable energy to run the planet for millions of years, all we need to do is tap into it. Renewable energy also creates more jobs that what is lost in the current fossil fuel generation of energy.
    Darwin has just announced that they intend to build the worlds larges solar farm.
    Ok all you pro dirty energy conspiracy believers let it fly. Captain to bridge, shields up. lol

    • 3

      And the other thing, a lot of countries like the UK, China, India, European countries, SE Asian countries etc are looking at phasing out diesel & petrol only vehicles & implementing legislation which will see vehicles with diesel & petrol only engines forced out of the show rooms & replaced with electric, hybrid & hydrogen powered vehicles to clean up the air pollution in their cities & countries. The air is much cleaner & healthier the last 12 months with less vehicles on the road burning fossil fuels. Proven fact for all you conspiracy idiots.
      Bridge to captain, shields holding. lol

    • 4

      Read Big Al comment. There are a large number of scientific brains that disagree with climate change as there’s are almost NO definite proof of it. Temperatures and other meteorological events haves only been recorded for the last century and the requirements for accurately recording them had changed quite frequently in that time. Also the exact location has changed also. For example there temp etc in my town were taken at the rear of the post office in the centre of town. Itt is notes located at the airport which is in an open and flat areas. Of course some of these readings will be higher because of it ‘s location. Here comes climate change.

    • 3

      BigAL said nothing really. I even googled him & found nothing of value at all so I’d say BigAl is a nobody with no credibility whatsoever.

  5. 8

    I do get tired of hearing about climate change. It’s becoming one of the main contributors to pollution across the world. It’s called a pile of BS.
    The Little bit of emissions that we produced will hardly make a difference. Look at India and China as was stated by inextratime. I have yet to see any proof of climate change other than the normal cycle of events. We have worse fires than we used to most certainly and it’s simply because burning of scrub like the Aborigines did has been stopped. Here’s a surprise for you. If the population is expanding suburbs into the hills and mountains and not having a firebreak around them will result in”worse” fires every time. Simply because we’re have chosen to live in these areas and homes are lost etc. Course they will be you are living in a high risk area. What else would you expect. Not climate change causing that is people’s stupidity to live in that high risk area and not take precautions.

  6. 7

    As a retired environmental scientist the evidence that increasing CO2 concentrations are the driving factor behind global warming is still fairly tenuous. Pretty well all the climate models tested to date have been fairly useless in predicting future temperature changes. Contrary to popular opinion the science is still out on the complex of factors driving climate changes.

    • 1

      I googled you, you are a fraud, a sham, Google came up with nothing. Maybe you’re an LNP right wing troll lol

    • 1

      In the past I’ve Googled Karl Marx and it wasn’t pretty. I even have more than a couple of books about his history. A parasitic evil monster who engendered the deaths of millions of otherwise innocent peoples in dozens of countries. Better to be an LNP right wing troll than a follower of such a lazy monster.

  7. 8

    “Are you worried about the financial implications of climate change on your retirement? Should the government be doing more to address climate change?”

    I don’t believe that climate change will alter my retirement income and I see this article as just another scare tactic from those who want to have us believe that man can change the climate. The IPCC is an organisation that is quick to attach anything to do with weather with climate change and they said last year that climate had nothing to do with the terrible bushfires.

    Yes, climate change is real, of that there can be no doubt just as the climate has been changing in a more or less regular cycle since as far back as geologists have been able to measure and certainly since before man walked this Earth. Those who bang the drum the loudest are those who need a fear of climate change to fill their coffers or politicians who have found a way to get votes by pandering to those who think that a politician can change the climate.

    I read time after time that we need to give money to organisations to affect climate change yet we are given no proof that all that money will change the temperature by 1ºc nor have they shown that stopping mining will do anything other than increase unemployment. Who recalls the hole in the ozone layer that was getting so big that unless we did something that all the hot air would disappear and we would all freeze? That scared people for a time and then it was global warming where Flannery said there would never be enough rain to fill our dams. The temperature stabilised about 20 odd years ago so now the scare tactic is climate change.

    When I get proof that all of the things that we are told will alter the climate then I will immediately roll my sleeves up and pitch in. When Shorten lost the unloseable election, one of the factors in his loss was the question “How much will your policy to change the climate cost?” and his non answer “To do nothing will cost a lot more!” Actually, the government is doing far more that is needed to address climate change. They should do nothing as man can’t change the climate and stop trying to appease those of the Left who will never vote for a Coalition regardless of what they do.

  8. 5

    For those that like to be informed read ‘Climate change delusion and the great electricity rip-off.’ written by Ian Plimer.

  9. 5

    Elan Musk – richest man in the world. Al Gore – worth 330 million. All gained via the climate change scare

  10. 1

    Yep, all the well read conspiracy follows & cynics are out in force on this one.
    Before Australians keep pointing the finger at other countries being worse contributors, remember to clean up your own back yard before you stick ya ugly mug over the fence.
    And what’s the worst that can happen if we clean up our energy & stop using fossil fuels & other contributing waste that harms the environment, animals & oceans. Well for a start we’ll have a far better & healthier environment to pass onto our kids & grandkids & even great grandkids.

    • 1

      Thank you Karl. It’s a breath of fresh air to read a response based on the futures of our grandkids instead of the ignorant self centred responses of the Luddites. There is no changing the minds of the ideological rusted one’s.
      Besides I would rather err on the side of caution than risk their futures.
      IF we are proven wrong which hopefully we will then nothing had been lost. However if we are proven right then it’s to hell with their futures. A situation I’m not prepared to risk.

    • 1

      Auction Girl, It is very worrying when a person has the attitude that you express here of “IF we are proven wrong which hopefully we will then nothing had been lost.” If Australia blindly follows the path that the “green new deal” type endorse, much will be lost.
      Australia is already losing industries that provide jobs to millions of us as we are unable to compete due to disparities in energy costs (and this includes transport) where many foreign countries have electricity costs less than a tenth that our primary and secondary producers have to pay to get the basics of a reasonable life style to our homes.
      Even now the paucity of energy generation means that on an average summer day, thousands of residents in Victoria can expect both blackouts and brownouts.
      The true cost of bringing “free” energy from the renewable sector is carefully hidden and ignored when it has nothing to deliver. No battery technology around the world has yet been developed that can supply that shortfall for a useful period of time in the quantities that are demanded.
      If you genuinely care about the world that our great grandchildren will come into, you would be demanding that the unreliable wind and solar would be discarded now and the building of the much safer and reliable nuclear power plants be fast tracked. (I am confident that things will be relatively stable for much of the lives of my grandchildren.)
      The environmental disaster that the disposal of tens of thousands of the blades from the windfarms (starting within the next 20 years) has not been included in the future costs of the green future. Landfill each and everyone of them. This is the real cost that Prof Steffen needs to include in his discussion.

Load More Comments



continue reading


What happens to regional travellers when borders snap shut?

Beryl lives in a regional area and is planning a trip to another regional area and wants to know if...


Surprising Aussie town of the year revealed

If you were asked to name Australia's best town, what would you say? If your mind wandered to the sweeping...


Avalon airport first to introduce COVID testing kiosks

Avalon Airport is the first in Australia to use COVID-testing kiosks after the HealthGate machine was approved by the Therapeutic...


Some of the world's most verdant city escapes

In an increasingly eco-conscious world, smoky, fume-filled cities often get a bad name. The car exhaust, the noise pollution, the...


Simon and Carla Fowler are sailing through retirement

As soon as the pandemic is over and life returns to some semblance of order, would you consider buying a...


Can you guess the city from a virtual walk around the streets?

As we rapidly approach the one-year anniversary of Australia's international borders being closed, you will not be alone in missing...


New South Wales' top five stays

Airbnb in New South Wales is booming. The variety and quality of stays is staggering. However, many of the most...


Jordan is a Middle Eastern delight

"Jordan is one of the driest places on earth. About 75 per cent of our land is desert," notes our...