Fears over cash for flood defences
Published 31/01/2012 | 01:32
MPs have raised concerns over whether there will be enough money to maintain and improve flood defences to protect millions of at-risk homes in the future.
The Public Accounts Committee (PAC) also warned it was unclear "where the buck stops" for managing the risk of flooding, as the Department for Environment, Food and Rural Affairs (Defra) has said it is not ultimately responsible for the issue. Defra told the committee it shares responsibility for flooding with the Environment Agency and local bodies, but the MPs warned the department had no way of knowing if local flood management was adequate and when it should step in.
A report by the parliamentary committee said the costs of flood damage currently stand at around £1.1 billion a year, and are likely to rise with climate change. Last week, a climate change assessment for the Government warned that the annual costs of flooding could increase to between £1.5 billion and £3.5 billion by the 2020s, and £2.1 billion to £12 billion by the 2080s for England and Wales.
Despite the Environment Agency's prediction in 2009 that its flooding budget needed to increase by 9% during the current spending period to maintain levels of flood protection, funding is being reduced by 10% over that time, the PAC said.
Defra told the MPs that efficiency savings and improved use of resources would mean capital expenditure on flood defences would not be reduced. But the Environment Agency has not yet adjusted its longer-term investment strategy and could not tell the committee what the scale of the long-term funding gap would be.
Margaret Hodge, chairwoman of the PAC, said the committee was "sceptical" of the possibility of raising funds locally when councils and businesses were facing financial pressures. She said: "Five million properties in England - one in six - are currently at risk of flooding. It is not acceptable that local people should be left in doubt about where responsibility and accountability lie."
The report said that with local people being asked to pay more towards flood protection and take on more of the risk, the Environment Agency needed to involve communities better in decisions on flood protection. The PAC also warned that the potential funding gap and concerns over whether local authorities and businesses will increase their contributions were fuelling uncertainty over future insurance cover for buildings in at-risk areas.
The current agreement between the Government and insurance industry to provide cover to households at risk of flooding ends in 2013 and the committee urged Defra to secure a new agreement urgently.
A Defra spokeswoman insisted the country was better prepared than ever before to deal with a major flood. She said: "We're investing more than £2.17 billion in flood prevention and expect to exceed our goal to better protect 145,000 households in England by March 2015. We've reformed the funding system to allow the number of flood defence schemes to be increased and give local people greater choice and control over protecting their community from flooding."
An Environment Agency spokeswoman said: "The Environment Agency is always striving to improve the effectiveness and value for money of our services to the public. We are already addressing a number of points raised in this report including placing more and more importance on how we work together with communities to agree the best options for local flood and coastal risk schemes."