Economic Recovery Practice Framework Toolkit

The Department of Jobs, Precints and Regions is the lead agency for economic recovery

The Department of Jobs, Precints and Regions (DJPR) works closely with Emergency Management Victoria, Government, industry and the community to help ensure Victoria has the resilience to survive, adapt and grow in the face of shocks and stresses it may experience. This includes delivering before, during and after activities for emergency management and working with critical infrastructure.

Under the State Emergency Management Plan (SEMP) DJPR is responsible for economic recovery. This includes coordinating and administering support for:

• the economy,
• businesses, and
• agriculture.

State Emergency Management Plan

The State Emergency Management Plan (SEMP) provides arrangements for an integrated, co-ordinated and comprehensive approach to emergency management at the state level. The Emergency Management Act 2013 (EM Act 2013) requires the SEMP to contain provisions for the mitigation of, response to and recovery from emergencies, and to specify the roles and responsibilities of agencies in relation to emergency management.

This framework is concerned with the recovery from the economic consequences of disasters and disruptions.

Economic Recovery is one of four, interlinked recovery domains

The interdependencies across recovery environments are important. Economic recovery is reliant on activities associated with recovery in the social, built and natural environments. Economic recovery outcomes are also dependent on relief and response activities. Relief, response and early recovery activities can set pathways and conditions that have a significant impact on the success of long-term recovery.

Economic recovery is critically linked to the built environment. Enabling business to reopen quickly relies on access to utilities such as power and water, as well as access to transport. Telecommunications, electronic funds transfers and access to the internet are central to business operating models. Economic consequence management often includes government working with infrastructure providers to support economic recovery.

A critical impact of emergencies can be the destruction of housing. Where destruction is widespread, the consequence of population displacement in the affected region can undermine the capabilities of businesses to recover. Decisions made by government that impact on short and long-term temporary housing options, locations and rebuilding may influence the reinvestment decisions by businesses, or impact on the success of those businesses that do reinvest. While decisions associated with other recovery environments will need to be made, it is important that government consider the impacts of these decisions.

Another issue that may face communities is the focus on building infrastructure or facilities to demonstrate commitment and action, often on the assumption that economic development flows from construction. Evidence suggests that early commitment to rebuilding tends to lock-in pre-existing vulnerabilities and misses the opportunity to fundamentally redesign the future of a disaster-affected location, while failing to support long-term business recovery.

The Framework explains both the core policy principals of Victoria's approach to economic recovery and what this looks like across the short, medium and long term.

The Economic Recovery Practice Framework aims to guide practitioners to develop and implement economic recovery interventions that increase local resilience to future disasters and shocks while improving the targeting and consistency of economic recovery supports.

Economic Recovery Practice Framework

Framework objective

Support Victorians affected by economic shocks through:

1. Recovery actions that will increase local resilience to future disasters and shocks, and
2. Improving targeting and consistency of government support and actions for economic recovery

Policy principles

Government support and action for economic recovery must consider:

• Market failure: Intervention is required where market failures exist or market capacity is exceeded.
• Economic vitality: Economic activity underpins economic and community recovery.
• Community-led action: Community strengths and assets need to be acknowledged and built upon.

Recovery stages

Economic recovery starts immediately after response and relief actions, planning for recovery starts during response and relief.

Recovery areas

Government can support and stimulate economic activity areas.

Planning

Economic recovery planning must work with local strengths and optimise actions for long-term outcomes.

• Place-based
• Community-led
• Coordinated and complementary
• Strategic and targeted

Implementation

Coordinated and orderly implementation provides transparent decision-making, delivery and opportunity to learn from evaluating actions.

• Impact identification and analysis
• Design and implementation
• Monitoring and evaluation

This framework provides guidance to government to meet economic recovery responsibilities and support better outcomes for local businesses and communities.

The economic recovery practice framework describes considerations to implementation by:

• describing the policy basis for the State Government’s role in supporting economic recovery from emergencies, natural disasters and other economic shocks and stressors, drawing on local and international evidence to demonstrate the role of government in economic recovery and that it is a crucial element of community recovery
• highlighting interdependencies between the economic recovery environment and recovery more broadly
• presenting a set of principles that can guide and effectively target the implementation of economic recovery activities, positioned in accepted economic policy principles and consistent with best practice from previous Victorian activities and experience from other jurisdictions
• noting the strong parallels between the rationale for and nature of the economic recovery response, with those associated with the government’s support for place-based structural adjustment and economic transition.

Policy principles

Government support and action for economic recovery must consider:

Market failure

Intervention is required where market failures exist or market capacity is exceeded.

• Businesses are responsible for using market mechanisms to manage and mitigate risks arising from emergency events and economic shocks.
• Government intervention to support recovery will be considered where the economic impacts extend beyond the capacity of market mechanisms or where market failures exist
• Economic recovery responses need to address indirect, intangible and longer-term economic impacts of an emergency event or economic shock are less likely to be addressed through market mechanisms and monitored at a community or regional level
• Where trauma exists, long-term planning for economic recovery should be closely aligned with the outcomes of social recovery

Economic vitality

Economic activity underpins economic and community recovery.

• Understanding of the interdependencies between built, economic, natural and social pillars and being aware of the economic consequences of recovery actions within these domains.
• Lessons of the past should also be embedded into current practice to prevent unintended and/or negative economic consequences.
• Local business, industry and community are critical to understanding the economic impacts of an emergency event and ensuring the effective targeting of economic recovery actions
• Economic recovery responses should align with the pre-existing relevant strategic, economic development, or emergency recovery plans.

Community-led action

Community strengths and assets need to be acknowledged and built upon.

• Local participation and community engagement are critical in enabling a clear understanding of the economic impacts of an emergency event and ensuring the effective targeting of the economic recovery actions.
• Economic recovery responses should be place-based and tailored to the economic and social characteristics of the affected location as well as the nature and scale of the event experienced.
• Activities should avoid masking deep-seated and ongoing impacts such as population decline and uncompetitive business performance.
• Local businesses should be utilised wherever possible in the delivery of recovery activities and recovery actions that replicate services provided by local businesses should be avoided.

Economic recovery starts immediately after response and relief actions, planning for recovery starts during response and relief.

Response and relief

Managing immediate impacts

Stage 1: Stabilisation

Managing short-term impacts to ensure business survival (0-3 months).

This phase addresses the immediate needs of impacted areas and communities, while longer term planning is underway and activities shift away from emergency response and relief. Examples of early recovery support services during this phase include:

• business advice and signposting to relevant services
• short-term planning to address immediate needs
• encouraging visitation, when safe to do so
• financial assistance and relief where activated, such as clean up and reinstatement, or direct support for businesses and primary producers.

Stage 2: Stimulus

Stimulus to support recovery to a self-sufficient and sustainable 'new normal' (3 - 12 months).

During this phase of approximately three to 12 months, further assessment and planning is underway while medium to long-term recovery activities begin. More targeted and locally-led recovery measures may occur during this time, including:

• tailored support to key business and industry sectors
• support for local jobs and business
• longer-term assessment and planning
• consumer and business confidence considerations.

Stage 3: Productivity and resilience

Future-proofing against economic shocks and longer-term transitions (> 12 months).

Depending on the nature of the emergency event, this may occur over a year or more. It is recognised that for significant events that recovery is a long term activity and includes more complex actions including:

• strategic planning
• long term plans for growth and resilience
• consideration of underpinning infrastructure
• reskilling and industry transition
• where relevant, returning to ‘business as usual’ for organisations and agencies.

The Framework directs practitioners to focus their economic recovery planning on the following areas.

Recovery areas

Government can support and stimulate economic activity areas.

Industry and business

Supporting industry to survive and thrive in the future economy.

• Businesses are supported to survive in the short-term and thrive in the longer-term, building on the economic strengths and opportunities of their region, with a focus on tourism, agriculture, forestry and small business.

Employment

Supporting people through jobs and skills.

• Workers are supported to participate in established and new employment opportunities, including through skills and training.

Community resilience

Communities drive the development of the future economy, underpinned by strong community cohesion.

• Communities are meaningfully engaged in shaping their future economy and increasing their resilience to future shocks, underpinned by strong community cohesion.

Enabling infrastructure

Strategic economy-wide investments and supports to underpin recovery and development.

• Strategic economy-wide and region-wide investments support resilient and connected enabling infrastructure that will underpin economic recovery and development, aligned to a region’s economic strengths, challenges and opportunities.

Economic recovery planning template

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