Bushfire-hit communities in the Blue Mountains will receive an immediate $1 million grant from the federal government.
Liberal Senator for Western Sydney, Marise Payne, said Blue Mountains City Council would be able to choose the best way to use the money to help the community recover.
"As we have seen in the township of Bell, council's recovery teams are already on the ground and this initial grant will help council to build on this effort by prioritising and delivering local recovery projects," she said
"While the operational response to the bushfire threat is ongoing, particularly as regards the Erskine Creek fire, the feedback I have received from locals highlights the acute need for funding to flow immediately."
Blue Mountains mayor Mark Greenhill thanked the federal government for the announcement, which he said "is deeply appreciated".
"This funding is a good start. We believe the full cost to our community - environmentally, economically, socially and in terms of the actual infrastructure rebuild that will be required - is going to be significantly more," he said.
"We are working closely with our community to determine the needs. We will work with both federal and state governments as we rebuild. But we learnt after the 2013 bushfires that it is going to take years to recover, and at this stage the full cost of the recovery is still unknown.
"We will stand with our community every step of the way."
Federal Member for Macquarie Susan Templeman also welcomed the funding.
"But there's no doubt we will need more funding, and it's important the government sits down and listens to local councils to make sure they get the resources they need to rebuild our communities physically and mentally," she said.
"We will also need assistance to overcome the dreadful impact these fires have had on the local economy, and we'll need swift action to help with that business recovery."
Prime Minister Scott Morrison said his government was committed to working hand in hand with regional communities to rebuild towns and villages.
"These payments will provide immediate assistance directly into the hands of local councils to rebuild roads and infrastructure, employ staff to help in recovery activities and hold events which bring the community together and bring tourists back to town," he said.
Funds will be drawn from the $2 billion allocated to the National Bushfire Recovery Agency and are in addition to funding that is automatically available to councils through other disaster recovery arrangements.
The only condition placed on councils is that they develop a program of works within three months and report back to the Commonwealth in 12 months' time.
