Queensland councils say the Federal Government is abandoning them by withdrawing much of the funding support for towns hit by cyclones and other natural disasters.

Mayors say the proposed changes will see the loss of billions of dollars in Federal funding for flood recovery and reconstruction.

The proposals under Government consideration would slash the Federal share of disaster recovery funding from 75 per cent to 50 per cent, and allow Canberra to escape paying entirely if the damage bill from the disaster is less than $2 million.

Local Government Association of Queensland President Margaret de Wit said the Productivity Commission proposals would represent a “massive cost shift”, allowing the Federal Government to avoid a large part of its responsibility to help communities.

“Communities need to realise the impact of these proposed changes and that if the Federal Government accepts them they and their local councils will be left to find other ways to pay for what are always hefty damage bills,” Cr de Wit said.

“The community will be left with an ugly choice; either pay more for reconstruction or be forced to leave large parts of their disaster-hit towns and regions in ruins for months until they can be repaired.”

She said the current disaster funding system under so-called Natural Disaster Relief and Recovery Arrangements was sound, efficient, and in little need of reform.

“What we are seeing here are changes that might look good on a bureaucrat’s whiteboard but would have dire consequences in regional communities in Queensland,” she said.

Cr de Wit said the Government had dragged its feet on the issue, while councils had diligently ensured the Productivity Commission and other agencies were given all information relevant to the inquiry.

“Whatever the Government decides will have a profound effect on council budgets so they need to know where they stand as soon as possible,” she said.

“If councils are in for additional costs in regard to their response to natural disasters they need to factor those costs in now.”