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Flood Risk

Volume 465: debated on Thursday 25 October 2007

I am in regular contact, as are ministerial colleagues and officials, with the insurance industry and the Association of British Insurers. We are working together to ensure the continued widespread availability of flood insurance cover through the association’s statement of principles.

I thank the Minister for that answer. He will be aware that it is now estimated that more than £3 billion is to be paid out by the insurance industry. How can my constituents be sure of keeping their flood insurance cover when only just over 40 per cent. of flood defences are properly maintained by the Environment Agency and when the increase in flood defence spending by 2010-11 will return us only to the level that we were at in 2004, before this year’s devastating floods? Can he give reassurance to my constituents and confirm that those in rural areas will not be neglected in order to put all the emphasis on urban areas?

The hon. Gentleman and I have discussed this issue so I am very aware of the impact that the flooding had on his constituents in Burstwick and Hedon. I would say to his constituents that the increase in funding that I announced at the beginning of July and the way in which that is going to be phased in between now and 2010-11 is a direct response to the requests that many people have made of us, including the Association of British Insurers. In June, it asked us to get up to £750 million a year by 2010-11; in fact, we are going to be spending £800 million a year by 2010-11. That is why, when I announced that figure, the ABI said that this was the news that homeowners had wanted to hear. I recognise that there has been a second round of flooding since then. I am very keen that we continue to work in partnership with the ABI as we significantly increase spending on flood defence, building on the doubling of investment over the past decade so that we can keep that statement of principles in place and therefore protect the hon. Gentleman’s constituents.

Following this summer’s flooding, my survey of 4,000 households in my constituency tells me that people would support my right hon. Friend’s Department giving incentives to landowners to manage their land in ways that help to prevent floods—not just the normal daily work of keeping watercourses and gullies free from obstructions but proactively, for example, by creating new water meadows and other wetland. Will he change the conditions for the single payment and the schemes for stewardship of land in order to give that incentive to landowners?

My hon. Friend raises an interesting and important point. Of course, there is already land that naturally floods during the winter, but the problem for some of the farmers whom I met was that they did not expect it to flood in that way during the summer, so it came at a bad time of the year and affected their ability to get their crops out of the ground. Yes, the Environment Agency does need to consider all the ways in which we can accommodate astonishing flows of water of the kind that we saw in June and July.

It is debatable whether landowners have to be paid to do that because in the winter they provide such flood capacity naturally. However, one lesson that we have learned from all of this—Sir Michael Pitt will be drawing all of them together in his lessons-learned review—is that we have to look at the inter-relationship of the ways in which water can escape when we have the astonishing amount of rainfall that we experienced during the summer. If my hon. Friend has not already done so, he might like to pass on the result of his consultation to Sir Michael Pitt so that he can consider it in his review.

In my constituency, we have had two “one in 30 years” floods in nine years, and the last time 2,000 properties flooded. The owners of those properties are worried that they will not be able to get insurance in the future. I suggest two things that the Secretary of State could do to help. First, there are too many agencies with responsibilities for different parts of the problem. It would be helpful if he were to put the Environment Agency in some sort of overall co-ordinating role.

Secondly, if we are to do a proper cost-benefit analysis of the flood defences that we can afford and make sense of, we need a comprehensive survey of what could be done about each little bit of local flooding. I suggest that the Environment Agency should either do that, or commission someone to do it. Without it, we cannot make the decisions on whether particular flood defences are economically sensible.

Those are two good suggestions. We were already consulting on giving the Environment Agency such responsibility, particularly in relation to surface water flooding. The hon. Gentleman is right; a lot of disparate organisations have responsibility for different bits of the surface water drainage system. I want to take on board whatever Sir Michael Pitt has to say, but I am keen that we make progress on the matter, because it definitely reflects one of the lessons that we learned from the summer, particularly from what happened in Hull.

Secondly, the Environment Agency needs to look at the range of potential schemes, but even with the additional funding that we are putting in place, there has to be a system for deciding on prioritisation of where the money will be spent. The Environment Agency has already been reviewing the points system that it uses to weigh the different considerations in reaching a decision, which is a process that I support. We recognise that a decision will have to be taken to fund one thing rather than something else, but at least we have more money with which to take that decision than was the case in the past.

In addition to welcoming the sensible suggestions made by my hon. Friend the Member for Stafford (Mr. Kidney) about managing river valleys so that their uplands are not intensively farmed or left in a situation where flood water can rush down them, will the Secretary of State consider earmarking some of the welcome investment in flood relief and flood defence schemes for the overhauling of antiquated surface water drainage systems? They are not up to the job, and caused as many problems as flooding from river valleys itself.

Now that I have announced the phasing of the increase in funding over the next three years, the Environment Agency will be in a position to plan. It will need to talk to local authorities about surface water drainage. The truth about such drainage is that we have a system that was built between 100 and 150 years ago, at a time when people did not expect to have to cope with the amounts of water that we have recently seen. The second problem is that we have concreted, covered with tarmac and paved over a lot of the surface land in our towns and cities, so when it rains to such an extent, there are fewer places for the water to go. It is not soaked up by the ground that is already saturated. Those are some of the lessons we have to learn. It will be a combination of improving capacity and ensuring that new drainage is built to a higher specification than was the case in the past, but we need to ask what more we can do in towns and cities to improve capacity to enable water to run off when we have rain of that sort.

I appreciate the Secretary of State’s interest in the impact of flooding in Gloucestershire, and in my constituency in particular. There are two issues that I would like him to raise with the insurers. First, is it wise to keep building planned houses on areas that flooded in July, such as Leckhampton in my constituency? Will the homes built there be insurable at any economic premium? Secondly, will the insurers be able to expedite payments to small businesses affected by the flooding? Many of them are still waiting for compensation months later, with an obvious impact on their cash flow, their bank charges and the interest that they pay on their overdrafts.

On the second point, I am happy to pass on the hon. Gentleman’s point to the industry. However, from my conversations with many people who were affected, including those in his constituency, and with hon. Members, it appears that the insurance industry responded well by and large in terms of sending assessors. I understand the point about payment; quite a lot has already been paid out.

On the first point, the hon. Gentleman knows that we have considerably strengthened the guidance in planning policy statement 25. We have given the Environment Agency, which is the expert on where there is a risk of flooding, a statutory right to be consulted. Ministers, of course, have a right to call in proposals. In the light of the strengthened guidance, it is a continuing responsibility on local authorities to ask themselves whether, if they intend to build on a flood plain, they can adequately defend against a risk that is increasing because the climate is changing. Approximately 2 million homes in the country are built on a flood plain. The building that we are in now is on a flood plain, but it has a defence. Local authorities must weigh that up when making decisions so that we do not add to the problems.

May I record my personal thanks to the Association of British Insurers, the managing director of which visited the Vale of York when it was flooded for the second time in 2005? Does the Secretary of State see fit to give an undertaking that water companies in future will be consulted on all new developments on the flood plain so that they can ascertain whether they should go ahead rather than being deemed fit simply to connect water and sewerage to new developments?

In reply to the question asked by my hon. Friend the Member for Stratford-on-Avon (Mr. Maples) about the involvement of too many bodies, the Secretary of State referred to predicting ways in which water will escape. Does he acknowledge that too many bodies are involved in mapping future flood risk? They include the Met Office, the Environment Agency, the ABI, individual insurance companies and district councils. Should not one body be made responsible for mapping possible future flood risk?

On the second point, there is a problem, especially in relation to surface water flooding. Although the Environment Agency maps for river flooding, it is hard, if not impossible, to predict where surface water flooding will occur because one has to know the volume of rain that will fall, exactly where it will fall and the gradient of the ground, and then assess the capacity of the drainage system. It is a problem, but I am sure that Sir Michael Pitt’s review will consider it.

Water companies’ interest is principally in the capacity to supply water to new developments. In the context of flood risk, the Environment Agency, to which we have given a statutory right to be consulted, is the body whose views we need to hear. However, all those matters should be considered because I am determined that we learn lessons so that we can do better in future.