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Last Updated: Wednesday, 22 March 2006, 06:00 GMT
Australia PM pledges storm relief
Prime Minister John Howard (r) looks at a ruined banana crop in Innisfail
John Howard said Australia could afford to help those affected
Australian Prime Minister John Howard has announced a multi-million dollar relief package for small businesses and farmers hit by Tropical Cyclone Larry.

Speaking on a visit to the north-east coast, Mr Howard said it was a "fair" response to a very difficult situation.

Meanwhile, health officials have warned the spread of disease and infection poses a new threat to residents.

Powerful Larry smashed into Queensland on Monday, tearing off roofs and leaving thousands homeless.

About a dozen people sustained minor injuries but no-one was killed.

Heavy rain hampered relief operations on Wednesday, with flooding delaying efforts to bring generators into the area.

'No-one's fault'

The category five storm hit Queensland at the town of Innisfail, about 100km (60 miles) south of Cairns, with winds of up to 290km/h (180mph).

A country like Australia can afford to be fair and generous and to help people get back on their feet
Prime Minister John Howard

Speaking in Innisfail, Mr Howard did not immediately announce aid for those made homeless by the storm, but said helping small businesses would help individuals.

"This is our initial response," he told farmers in the town. "I think it's a very comprehensive response to a very difficult situation."

He went on: "This is not anybody's fault, and therefore a country like Australia can afford to be fair and generous and to help people get back on their feet."

The relief package includes a tax-free A$10,000 grant (US$7,500) and access to low interest loans of up to A$200,000 (US$145,000).

Officials have warned that another storm - Cyclone Wati - is developing out to sea and could reach the Queensland coast later in the week.

Water warning

Sewage systems in Innisfail collapsed after Larry hit and it could be weeks before power supplies are restored across the area.

Public health officials have warned of a danger of outbreaks of typhoid, gastroenteritis, hepatitis A and mosquito-borne diseases like dengue fever.

Residents stand outside their destroyed home in Kurrimine Beach, Queensland
Officials have predicted a "long, slow recovery"

Water remains one of the major concerns despite the fact that a water purification unit has been set up by troops.

"The water treatment plants don't work and we are issuing a boiled water notice to residents to keep boiling their water," David Sellars from the Tropical Population Health Unit told Australian radio.

Queensland state leader Peter Beattie has predicted a "long, slow recovery" but praised emergency services' response.

He said the bill for the cyclone was likely to run into tens of millions of dollars.

The area is an important centre for Australia's banana and sugar cane industries and farmers say production has been badly hit.

The Australian Banana Growers' Council estimates 80% of the country's banana crop has been wiped out and as many as 4,000 plantation workers could lose their jobs.

See the damage caused by Cyclone Larry

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