A state parliamentary committee has recommended improvements to NSW’s land valuation system, potentially paving the way for changes to emergency services funding.

It comes after the State Government last year released a discussion paper that proposed a shift to property-based funding for emergency services. Currently, an emergency services levy is added to insurance policies.

“The emergency services levy, which funds about 75% of NSW’s emergency services, is inequitable, inefficient and unfair,” an Insurance Council of Australia spokesman said.

“It penalises householders who take out insurance by making them pay for a service everyone – including the non-insured – receives.”

The Government’s proposed alternative is a levy based on land values, which are estimated regularly by the Valuer-General.

However, concerns have been raised about the valuation system.

The parliamentary committee says issues include the volatility of land values and fairness of the system. It recommends a series of changes.

“The objective of the report is to give land owners greater confidence in the valuations they receive,” committee chairman Matt Kean told insuranceNEWS.com.au.

No decision has been made on a preferred method of emergency services funding, he says.

The State Government’s response to the valuation report is due by November 4.

Taxes on insurance premiums currently contribute about $763 million a year to the state’s emergency services, plus $63 million in stamp duty. Local councils and the NSW Government pay the rest.

The funding discussion paper, released last July, proposes an annual property-based tax of up to $267 for land valued at $250,000.