Oral Answers to Questions

Debate between Lord Benyon and Rory Stewart

Thursday 17th December 2015 Commons Chamber

[Richard Benyon (Newbury) (Con)]

May I compliment my right hon. Friend the Secretary of State on the way in which the tragedy for people in the north-west has been dealt with? Some people have a simplistic view about flooding, seeing it as a binary issue and, for example, saying that dredging works in all cases—we know it does not. There are circumstances where capital schemes such as the Minister has outlined are the solution, but in other cases a more nuanced approach is required. Will her team continue to make the point that every different flood event requires a specific solution?

[Rory Stewart]

First, I pay tribute to my hon. Friend, who was a distinguished floods Minister and is right in what he says. We need to look also at upstream mitigation, which means the planting of trees, the restoration of poached soils, and examining peat bogs and river movement. This is not only about hard defences, and the work that we will be doing over the next few months will focus exactly on those natural measures.

draft Flood Reinsurance (Scheme and Scheme Administrator designation) regulations 2015 DRAFT FLOOD REINSURANCE (SCHEME funding and administration) REGULATIONS 2015

Debate between Lord Benyon and Rory Stewart

Tuesday 15th September 2015 General Committees

[Rory Stewart]

From the insurance company’s point of view, in the case of the households that are most at risk, Flood Re provides the ability to lay off the flood component of its household and buildings insurance, which for a basic rate council tax payer is in the region of the £220 to £250 mark. There would be no reason for an individual insurance company to make the flood component of its insurance exceed that amount—that is the purpose of the £180 million pot.

I agree, however, with the hon. Gentleman on the basic questions with which he began, and we certainly need to look at this during the next 25 years: building on floodplains, climate change and increasing flood risk. That will have an impact right across the industry.

[Richard Benyon]

I agree entirely with my hon. Friend. Can I urge the hon. Member for Brent North to be careful about making bland criticisms such as those about building on floodplains? London and York are floodplains. Do the comments apply to those great cities? The issue is about how we build on floodplains and how much flood resistance there is. We can all think of buildings on floodplains that were lunacy and should never have happened—perhaps the Environment Agency was ignored—but such sweeping statements on this important issue need to be qualified carefully.

[Rory Stewart]

I am grateful to my hon. Friend, who is correct. Building on floodplains is a question of doing detailed calculations; the point is not that floodplains cannot ever be built on. Scotland provides a good example in the constraints that it has placed on building on floodplains, but Scotland has certain advantages in terms of population movements and the nature of the land.

As my hon. Friend said, there are technical solutions that allow for building on floodplains in Britain in a more sensible fashion, but most important of all is the natural capital calculation. We need to be much more realistic about looking at the social and economic costs of building on floodplains. What are the likelihoods of a risk? How much is that likely to cost the householder? How much misery and distress is that likely to cause them? What impact might that have on house prices? When all that is taken into account, someone might still, for particular reasons, decide to build on a floodplain. There could be very good reasons to go ahead, but they must ensure they have gone through the due diligence and looked at the potential costs and risks of doing so.

That brings me to my conclusion. This has been a good and testing debate, as I have come to expect from the hon. Member for Brent North, and it means that we are now one step closer to ensuring affordable insurance. I am reassured that the Opposition are not challenging the measures. I think Members across the Committee would agree that the work done over the past few months by my hon. Friend the Member for Newbury, by the insurance industry and by many of our civil servants—who must be both relieved and exhausted at reaching this stage—has brought us to a pretty impressive model.

I would like the United Kingdom to boast about and share this model with the rest of the world, so that others can see how we have addressed the issue in a pragmatic and focused way. We have done it by working with the insurance industry instead of against it. We have included a very broad sweep of universal provision and have taken into account questions of transition. We have set up a 25-year process. All that shows long-term strategic thinking and market focus, which we should be proud of.

I thank the Committee for the opportunity to set out the Government’s approach on Flood Re and the insurance industry for its hard work. This legislative framework is a good model for balancing pragmatic considerations of how a scheme can operate with public policy objectives. I commend the regulations to the Committee.

Question put and agreed to.

Resolved,

That the Committee has considered the draft Flood Reinsurance (Scheme and Scheme Administrator Designation) Regulations 2015.

Draft Flood Reinsurance (Scheme Funding and Administration) Regulations 2015

Resolved,

That the Committee has considered the draft Flood Reinsurance (Scheme Funding and Administration) Regulations 2015.—(Rory Stewart.)

Oral Answers to Questions

Debate between Lord Benyon and Rory Stewart

Thursday 10th September 2015 Commons Chamber

[Rory Stewart]

Flood Re was established in May and will become operational in May next year. The House will have an opportunity to debate the regulations with me next week.

[Richard Benyon (Newbury) (Con)]

Will my hon. Friend reassure me that, as well as the hard engineered projects that will be funded by the large sum of money he has mentioned, there will be soft engineered projects that build on the experience in Pickering, in the constituency of my hon. Friend the Member for Thirsk and Malton (Kevin Hollinrake), which uses natural features such as woodland and coastland wetland areas, which protect coastal communities from flooding? Such schemes can be cheaper and more effective in certain circumstances.

[Rory Stewart]

My hon. Friend has an enormous amount of experience in this area. We can do much more to help on flooding, including restoration of peatland, woodland and wetland areas, which not only benefits flood alleviation, but considerably benefits habitats and the biodiversity that depends on them.