Committee claims large coalition cuts leave significant shortfall in protection of 5m UK homes at risk of flood damage
Government cuts have left a "big mismatch" between the money available for flood defences and that needed to maintain protection for the 5m UK homes at risk of flooding, a powerful group of MPs has said.
"The annual cost of flood damage is at least £1.1bn and ageing defences and climate change will increase that bill," said the Public Accounts Committee (PAC) chair, Margaret Hodge. "So flood protection is a national priority. The Department of Environment sees more funding coming from local sources [but] we are sceptical this will be possible when local authorities and businesses are themselves under financial pressure."
A landmark study on the risks posed to the UK by global warming published by the Department for Environment, Food and Rural Affairs (Defra) on 26 January showed increased flooding was by far the greatest threat, with damage forecast to rise by up to 10 times.
The environment secretary, Caroline Spelman, and the prime minister, David Cameron, have both spoken of the rising risk in the past, but capital spending on flood defences fell by 27% in the first year of the coalition government. More than 1,000 schemes that had been in line for funding were left in limbo.
"The PAC has hit the nail on the head," said Charles Tucker, chair of the National Flood Forum, which represents hundreds of local groups. "The money just isn't there – either from government or from local sources. The government is flying on a wing and a prayer – hoping against hope that the big floods keep off until national finances improve – and gambling with the future of thousands of communities."
A Defra spokeswoman said it was improving protection: "The country is better prepared than ever before to deal with a major flood," she said. "We've reformed the funding system to allow the number of flood defence schemes to be increased [by allowing communities to pay toward defences] and give local people greater choice and control over protecting their community from flooding."
The Environment Agency (EA), which delivers flood defences in England and Wales, said in 2009 that this budget needed to rise by 9% between 2011 and 2015 to maintain current levels of protection, but the budget has been reduced by more than 10% over the four years.
The EA said efficiency savings would offset some of this loss but were unable to tell the Pac what the long-term funding gap would be. The EA also states that "every pound spent on protecting communities from flooding saves eight pounds spent repairing flood damage over the lifetime of a scheme".
Defra's new funding regime requires private companies, local authorities and communities to increase their contributions from £13m over the last three years to £70m over the next three. It had not secured these commitments, said the MPs.
"Expecting an increase in local authority contributions when their resources are reducing may well be over-optimistic," concluded the committee. However, a Defra spokeswomen pointed to the example of Sandwich in Kent where Pfizer, which is closing its research facility at the site, and Kent county council, have together pledged up to £12m towards flood defences.
Mary Creagh, Labour's shadow environment secretary, said: "The government is passing the buck to local councils, asking them to choose between repairing roads and protecting homes from flooding. The irony is that this approach may cost more in the long run, as the Environment Agency is unable to predict what schemes will proceed, which means procurement costs rise."
The committee also criticised a lack of accountability for flood defences. "It is unclear where the buck stops and who is ultimately responsible for managing the risk of flooding," said Hodge, a Labour MP.
"Defra tells us it is not ultimately answerable and shares the responsibility with the Environment Agency and local bodies. But Defra has no way of knowing whether local flood management systems are adequate or when it should step in. It is not acceptable that local people should be left in doubt about where responsibility and accountability lie." The Environment Agency is largely funded by government and is responsible to Spelman.
Finally, the availability of insurance to those at risk of being flooded also concerned the MPs, as the agreement between Defra and the insurance industry to provide this ends in 2013.
"In some areas premiums appear to have risen as a result of growing uncertainty over local levels of protection," the report found, with MPs urging the government to strike a new deal urgently to reduce the uncertainty for affected householders.