The New Zealand insurance industry has welcomed a $NZ5.5 billion ($4.1 billion) funds injection to assist rebuilding in the Canterbury region.

Last week’s Budget announced the creation of a Canterbury Earthquake Recovery Fund, with the money going to infrastructure and schools, temporary housing, trades training, welfare and business support.

It will also be used for demolition costs in the Christchurch central business district, where around 300 buildings are listed for partial or total demolition.

Insurance Council of New Zealand CEO Chris Ryan told insuranceNEWS.com.au the funding shows the Government is committed to rebuilding Canterbury as it will mostly be spent on infrastructure and other government costs.

While there was nothing specifically for the insurance industry in the Budget, Mr Ryan says there is a good partnership between the Government and industry in the recovery of Canterbury. 

He says the Budget “reflected a more optimistic outlook on the economy”, with signs the recession might be bottoming-out and the budget returning to surplus in 2014/15 – a year earlier than expected.