The Commonwealth will give more than $434 million to help communities in NSW clean up the damage from the floods, which will also be supported by the state government.
Prime Minister Scott Morrison said the government had also requested a proposal of projects from Queensland to help with recovery efforts.
"We will be there to help farmers, small businesses and every community in New South Wales to get back on their feet as soon as possible when flood waters recede," Mr Morrison said in a statement.
"We are working with Queensland on what support will be made available under Category D funding, ensuring communities receive the funding they require to rebuild."
The prime minister said a second support package was also being proposed for NSW.
"This initial package is in addition to the federally funded $1000 disaster relief payment and the 13-week income replacement for employees and small business," Mr Morrison said.
Since the flooding disaster, $62.7 million in disaster recovery payments have been provided in relation to 52,000 claims lodged with the federal government.
More claims are expected to emerge in coming days as the extent of the crisis becomes clearer.
In Queensland, dangerous thunderstorms are set to trigger further floods in the state's southeast, just days after the previous deluge.
Large parts of the state remain underwater, with clean-up efforts still ongoing.
In NSW, more than 500,000 people have been told to evacuate, with homes in northwest Sydney and along the coast affected.
The cleanup also continues in the state's north coast, with towns and cities such as Lismore still facing shortages of critical supplies like food, fuel and fresh water.
Mr Morrison convened an online roundtable on Thursday discussing supply chain issues due to the floods, after critical road and rail links were blocked by rising waters.
Defence chief Angus Campbell, Emergency Management Minister Bridget McKenzie and disaster assistance coordinator Joe Buffone also attended the meeting.
As the flooding crisis shifts south to parts of Sydney and the NSW south coast, Deputy Prime Minister Barnaby Joyce conceded climate change had made the flooding crisis worse than previous natural disasters.
"This is a unique event, and quite obviously the climate has changed, because otherwise you wouldn't have had a record event," he told Sky News.
"You can always plan for what's happened in the past, but to plan for something that's never happened before is impossible, but now we have a new high mark that we have to plan for."
About 900 ADF personnel are already on the ground as part of flood rescue and assistance measures.
It comes as opposition emergency management spokesman Murray Watt said the government was not putting Services Australia staff in Labor-held electorates in Brisbane where there had been flood damage.
"There really does seem to have been some political intervention in how these Services Australia teams, staff, have been allocated," he said.
"While four Labor held electorates in southeast Queensland are not getting a single Services Australia person, the marginal electorate of Longman has got three different teams being sent to it."
Government Services Minister Linda Reynolds said the locations were determined by state authorities.
"It's disappointing to see Labor playing cheap politics while we're focused on the disaster response," she said in a statement.
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