Cyclone Debbie is expected to cost the Queensland Government about $1.1 billion in recovery work, according to the state’s budget papers.

The total includes grants to local councils and spending on road infrastructure over four years to 2019/20. The state will receive partial federal reimbursement through the Natural Disaster Relief and Recovery Arrangements (NDRRA).

The state has also proposed a $220 million exceptional circumstances package, jointly funded under the NDRRA.

“The funding package is contingent on the approval of the Commonwealth and includes a request for a matching contribution for the South Rockhampton Flood Levee,” the papers say.

Treasurer Curtis Pitt says Debbie, which hit Queensland at the end of March, will shave about $2 billion, or three-quarters of a percentage point, from the state’s economic growth across this financial year and next.

“For the 2017/18 year the budget will remain in surplus, albeit dramatically reduced due to the impact of natural disasters,” he said.

The budget includes $5.6 million for the Community Resilience Fund, to help local governments deliver infrastructure that will develop and improve resilience.

Insurance taxation revenues, which include duty on compulsory third party premiums, are forecast to increase 4.7% to $892 million next financial year.