The cost of repairing Christchurch after its devastating earthquakes has risen sharply today, and could go even higher. Photo / AP
The cost of repairing Christchurch after its devastating earthquakes has risen sharply today, and could go even higher. Photo / AP
The Earthquake Commission's quake cost blow out from $4 billion to $7.1 billion could go even higher.
Chief executive Ian Simpson told Newstalk ZB's Larry Williams it is an early estimate, and could change in either direction.
"We start with the worst houses first when we run the assessments, sothat sample is heavily biased towards the more severe damage,'' he says.
Ian Simpson said if there is another major disaster in the country, EQC still had $2.5 billion of reinsurance, but the government would have to meet its initial liabilities.
Meanwhile, Treasury has been told to take another look at its estimate of the cost of the Canterbury quakes.
Treasury's last estimate put the total cost at $15 billion - but Finance Minister Bill English says they need to revise that.
"They would want to take into account not just the changes in the EQC liability but trying to get a handle on what's happening with private insurer liabilities as well. So it could be a while before there's another estimate. In the meantime though, we've got the ability to meet the claims,'' he says.
It's likely the revised, total cost will be in excess of $20 billion.
Earthquake Recovery Minister Gerry Brownlee says no insurance company in the world has ever faced as many claims - EQC's received 388,000.
He says the initial estimate was based on the best available information at the time.
Following EQC's blow out today, the Green Party has renewed its calls for the Government to introduce an earthquake levy.
Green Party co-leader Russel Norman says all New Zealanders should make a small contribution to the cost of the rebuild and stop the Government's books being thrown into a massive deficit.
Dr Norman told Newstalk ZB's Larry Williams the Government's in a fiscal hole and needs to act.
