Prime Minister John Howard flew to Innisfail on Wednesday where he announced an aid package worth A$100 million.
This included $1 million for the disaster relief appeal. Mr Howard also said small businesses affected by the disaster would be able to access tax-free grants of $10,000.
The prime minister, accompanied by Premier Peter Beattie and Opposition leader Kim Beazley, toured the devastated region and spoke with affected residents, farmers, and emergency workers.
But with emotions running high among some residents and farmers who suffered huge losses as a result of the cyclone there was criticism that state and federal governments were not acting fast enough.
Mr Howard was heckled as he walked through Innisfail, the town hardest hit by Larry.
"Come and wait in line," shouted one person in a line of several hundred people who had been waiting for hours outside government buildings to ask about emergency financial aid.
Mr Howard also visited a devastated banana plantation near Innisfail.
Johnstone Shire Mayor Neil Clarke dismissed the complaints as "unrealistic" and said the response from both state and federal governments and their agencies was "fantastic".
"We were determined not to be another New Orleans," he said, in reference to the slow US government response in the wake of Hurricane Katrina last year.
The banana industry has reported losses of up to A$300 million and there's significant damage to cane fields.
Relief workers
More than 120 firefighters and SES volunteers arrived in Innisfail on Wednesday as part of a second wave of support for the ravaged community.
An additional 75 volunteers from Rockhampton and Townsville have also travelled to the area, providing relief to volunteers already on the ground.
Water supplies had been restored to the north of the Johnstone shire, mobile phone coverage was back and a garbage contractor had resumed his rounds in Innisfail.
A 63-year-old man found dead in a caravan at Innisfail was believed to have suffered a heart attack on Sunday afternoon and was not being considered a cyclone fatality.
More than a thousand buildings have been damaged, including 55 percent of buildings in Innisfail and 80 percent of buildings in Babinda.
On Wednesday more than 120 thousand homes were still without power and more than one thousand residents have had to be evacuated.
Efforts to clean up outlying areas were being hampered by torrential rain.
The Bureau of Meteorology said 289mm fell in Innisfail in the 24 hours to 9am (AEST) on Wednesday.
"They actually had more rain than during the cyclone itself," Jonty Hall of the Tropical Cyclone Warning Centre said.
But meteorologists were closely watching category three tropical Cyclone Wati, which was almost stationary in the Coral Sea.
At 6pm (ASET) on Wednesday, Wati was 580km north-east of Mackay and drifting erratically in a south-southwest direction.