Australia floods split Victoria town of Horsham in two

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Media captionHorsham resident: "I woke up dreaming that I was rocking"

Floodwaters in Australia's state of Victoria have split the town of Horsham in two, as the body of a young boy was found in another flood-hit town, Shepparton.

Heavy rains which had laid waste to Queensland are causing an escalating emergency in Victoria.

Prime Minister Julia Gillard is to form a panel of corporate leaders to help rebuild devastated infrastructure.

The floods are said to be Australia's most expensive natural disaster.


The body of the eight-year-old boy who disappeared in a flooded waterhole near Shepparton on Monday was found by police divers.

"We always had some sort of hope but unfortunately the worst has occurred and it should strike fear into the hearts of every Victorian to be vigilant with their children around water, particularly floodwater," said acting senior sergeant Jason Kelly.

Image caption Horsham residents are watching the Wimmera River take over their homes

More than 50 communities have been affected by the rising waters. More than 3,500 people have evacuated their homes in the north central part of the state.

The city of 14,000 people has only recently started to emerge from a decade-long drought but now many of its streets resemble lagoons.

Horsham is bracing itself for a "one-in-200-year flood", Mayor Michael Ryan said.

"There's nowhere for this water to hide. It must come through the river - it must come through Horsham," he said.

Electricity cuts have occurred as power stations have been flooded.

Sandbags have been stacked up to try to withstand the waters, which are expected to peak later on Tuesday.

An emergency services spokeswoman said there would be "significant" flooding of properties "with water up to 1m (3ft) deep in some areas".

'Most expensive'

Further north, at least 30 people died in floods in Queensland, since the tropical storms began at the end of November.

Ten people are still missing after flash floods, and recovery efforts are proving slow and gruesome.

The government has also warned that the floods in Queensland could be the country's most expensive natural disaster ever.

Ms Gillard said the country needed private industry to help the recovery and reconstruction effort.

"I've decided to bring together 10 Australian leading business people to form a business round-table to assist with corporate support, as Queensland recovers and rebuilds from these devastating floods," she said.

Anna Bligh, Premier of Queensland, said her state needed "business and corporate Australia standing with us" and "community members doing what they're doing out there with mops and buckets, digging into their pockets and putting some money into the relief appeal".

Ms Bligh announced an inquiry into the flooding that would look at issues including the operation of dams and would serve as an investment in the state's future.

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