NSW audit finds $980m flood adaptation programs began with no business case

On 20 May 2026 the Auditor-General for New South Wales, Bola Oyetunji, tabled in both houses of the state parliament a performance audit of the two programs built to move Northern Rivers households out of harm's way after the 2022 floods. Its conclusion is that the Resilient Homes Program and the Resilient Lands Program "were not effectively planned before implementation", and that there was no business case or cost-benefit analysis to inform the design and establishment of either one.

The two programs together carry $980 million. The Resilient Homes Program, budgeted at $880 million, buys back flood-exposed houses and pays for resilience works such as home raising and rebuilding in flood-hardened materials. It is co-funded with the Commonwealth through the Disaster Recovery Funding Arrangements: the first tranche of $800 million included $350 million in Commonwealth money, and a second tranche approved in 2024 added $90 million from each government. The Resilient Lands Program, budgeted at $100 million and funded by New South Wales alone, was meant to open new land so people leaving the floodplain had somewhere to go.

The delivery figures in the report are the story. As at 31 March 2026, four years after the floods, 793 buybacks had settled against a target the agency had already cut to 1,000. Fifty-four resilience works had been completed. The land program had delivered no homes and no lots at all, against 4,382 anticipated in the Resilient Lands Strategy published in August 2024. As at February 2026 the buyback stream had spent $581.5 million and the resilience stream $17.5 million.

The audit is specific about what was missing at the start. Detailed project plans, timelines and key milestones were not developed for either program before it commenced. Detailed risk mitigations were not in place. Formal governance arrangements for the land program did not exist until October 2024. No monitoring and evaluation plan existed until late in delivery. The 2018 NSW Government Business Case Guidelines, in force when the first funding request went up in September 2022, required a full business case; the assistance request form submitted to the National Emergency Management Agency met the Commonwealth's information requirements but, the audit says, was "not sufficient on its own to fulfil the requirements of the guidelines".

The deadline has moved twice. The August 2022 request to the Commonwealth said the $800 million would be spent by June 2024, matching the two year limit under the funding arrangements. In September 2023 the state sought an extension to June 2025. In late 2024 it applied again, and the Commonwealth approved a deadline of June 2027, shifting the expenditure clock by three years. The first resilience payment was not made until December 2023, twenty one months after the first major flood event of February 2022. Thirteen people died in the floods between late February and early April 2022; 4,055 properties became uninhabitable and another 10,849 were damaged.

The targets moved as well. On the initial $700 million the agency estimated about 1,000 buybacks and 370 resilience works. When the budget rose to $880 million in May 2024 it estimated 1,345 buybacks and 420 works, and treated those as targets. In August 2025 it re-profiled to 1,000 buybacks and 600 works, a shift the audit attributes to community and local council feedback asking that more money go to households with limited capacity to pay. The report states plainly that the buyback stream will not meet its original funded target of 1,300.

The accounts of what this means diverge. The Reconstruction Authority's chief executive, Kate Fitzgerald, said key elements of planning, governance and delivery "were not sufficiently developed before the programs commenced in 2022". The state recovery minister, Janelle Saffin, said the programs were established in the immediate aftermath of unprecedented floods and that upfront planning was not where it should have been. The Greens MP Sue Higginson put the completion rate at one per cent, measuring 54 works against 4,400 raises and retrofits she says were promised, a denominator far larger than any target recorded in the audit. The federal member for Page, Kevin Hogan, said more than 1,000 homes identified for buyback will not be bought; the audit says 1,300 homeowners were contacted before the target was cut, and that some did not apply while others were found ineligible.

The report makes five recommendations, including accelerating the land program by September 2026 and publishing an ex-post cost-benefit analysis of both programs by March 2028. A separate Commonwealth audit offers a contrast: Auditor-General Report No. 35 of 2024 to 2025, published on 26 May 2025, found the award of funding under the $1 billion Disaster Ready Fund "largely effective", with $402.15 million awarded to 362 projects across two rounds and six recommendations to the National Emergency Management Agency.

What is not yet known is whether the June 2027 deadline holds. Nine of the twelve land sites are now due for completion by the end of 2026 or 2027 and the rest in 2028, with half the sites already delayed by between six and twenty one months. Whether any co-funding is returned unspent, and what the ex-post analysis will find about value for money, remains open.