OPPOSITION leader Bill Shorten blamed government red-tape for delaying the delivery of much-needed financial assistance to victims of the flood, which devastated much of the Tweed.

The Labor leader's visit to Murwillumbah today coincided with the Federal Government's announcement to upgrade the disaster relief package to a Category C level for parts of the Tweed, two weeks after record floods hit the region.

Mr Shorten said the level of "red tape warfare” had left an impact on the region.

"What small business and farmers need is not a loan, they just need a bit of a cash injection,” Mr Shorten said, standing beside Richmond MP Justine Elliot outside Murwillumbah Services Club.

"These grants won't compensate them for loss of crops, for fence damage, for ripping up the carpets and all the work that needs to be done. What it does do is just stop people tipping over the wrong way.

"What we need to do is not use red tape holding up people's applications. It's been a number of days since the floods, the government should have just ticked the box to say the grants are available, it's happened every other time.”

Mr Shorten said it was important for the rest of the country to remain aware of the lasting impact the floods have caused.

"We need to be looking out for each other,” he said.

"If you've three or four kids, if someone's not working, if someone's got an illness, this is not business as usual.

"We need to encourage tourism. For 51 weeks of the year, it's paradise so we need to keep encouraging people who were planning their trips to keep doing that because this is an incredible part of Australia.”

Walking through South Murwillumbah, Mr Shorten visited the Australian Post office, uniform shop and organic butchers on Prospero St, speaking with business owners whose properties had been inundated with floodwater on March 30.

Post Master Rod Butterworth showed Mr Shorten where the water rose inside his shop and said while most of his equipment was functioning, his insurance company hadn't allowed him to start operating yet.

"We're out of business until we can get it assessed,” Mr Butterworth said.

"I've got the whole incident on CCTV which will go to the insurance companies.”

Speaking with the owners of Southern Cross Organic Butchers, Mr Shorten heard from Alf Smith who said he was struggling to re-open his business.

"This has been a butcher shop for over 100 years, always has been, but looking at it now, this will be its last days,” an emotional Mr Smith said.

"We can't open without an insurance company coming through, we didn't have flood cover.”