Flood Insurance

Baroness Blackwood of North Oxford Excerpts

Tuesday 26th March 2013 Commons Chamber

[Nicola Blackwood (Oxford West and Abingdon) (Con)]

I congratulate my hon. Friend the Member for Esher and Walton (Mr Raab) on securing this timely and important debate. I have 1,627 homes and businesses in my constituency that are at significant risk of flooding. I have visited streets in Abingdon, Kidlington and Oxford where ripped-out carpets, kitchen units and discarded furniture were all piled up and abandoned on pavements in 2007, and that sight is branded on my memory. I guarantee that not a single one of those home owners has forgotten that summer, and since then we have had any number of flood warnings that serve, like tremors after an earthquake, to reawaken the anxiety of that week of flooding and the reconstruction that followed. It cost the county £3 million and the country £3 billion.

For those who live at flood risk, there is no respite. Instead, they live in a constant state of uncertainty, never knowing what our delightful British climate will bring. Uncertainty driven by weather is one thing, but uncertainty that is driven by our response to flood risk is another. Other than by inventing a weather machine we are not going to eliminate flood risk, but we have three, interdependent levers to mitigate flood risk and limit the stress that it brings. Those are flood insurance, flood defences and individual property and community resilience.

Whether people are rampant climate sceptics or paid-up members of the Green party, most studies show clearly that changing weather patterns mean that flooding is on the increase, while population increases and poor planning have exacerbated the problem dramatically. We will have to get better at using those levers to mitigate that risk. In particular, overloaded infrastructure, such as drainage capacity, is leaving increasing numbers of constituents at the mercy of not only notoriously hard-to- respond-to surface water, but revolting episodes of effluent flooding. I am aghast that in this day and age I have constituents who have to cope with sewage coming into their homes simply because it is raining. We are supposed to be living in a highly developed country. The worst thing is that the insurance situation means that they feel gagged because they do not want to put their local property market at risk.

[Mr Nick Gibb (Bognor Regis and Littlehampton) (Con)]

My hon. Friend’s description of seeing homes in her constituency flooded reminds me of the problems I saw in Bognor Regis and Littlehampton on 10 and 11 June, when more than 300 homes were flooded. Does she share my view that in addition to the flood insurance issue, we need to spend sufficient capital to ensure that the surface drainage system is sufficient to mitigate such problems when heavy rainfall occurs?

[Nicola Blackwood]

I agree that infrastructure is vital. I believe deeply that many of the problems we face today stem from an inherited legacy of bad planning.

[Mr Andrew Smith]

rose—

[Nicola Blackwood]

My right hon. Friend—ish—the right hon. Member for Oxford East (Mr Smith) knows how difficult it can be to get accountability and solutions for constituents when responsibility falls between the Environment Agency, local authorities and Thames Water, and he might want to comment on that point.

[Mr Smith]

I am grateful to my hon. Friend-ish for giving way.

Flood waters are no respecters of constituency boundaries and we work closely on these issues. On planning, does the hon. Lady agree that, given that successive Governments and councils of all complexions have allowed so much development on the floodplain, it is perfectly proper for the state to pick up some of the responsibility by participating in insurance schemes, such as “Flood Re”, which are the only way to protect our constituents from unaffordable premiums?

[Nicola Blackwood]

Clearly, it is vital that flood insurance continues to be widely available and affordable, a point I will come to in a moment. Although there is frustration about the responsibility of different agencies working together to respond to constituents, the emergency response to flood events locally since 2007 has improved dramatically, and there have been positive developments on flood defences in Kidlington and Oxford.

However, none of that addresses the long-term strategic challenges we face, and insurance has to be at the top of that list. That is why, with all the other urgent flooding priorities that we have heard about, we have to focus on the 30 June deadline. That date dominates the lives of far too many of my constituents. They fear that they will suddenly become uninsurable, breach their mortgage conditions and have unsellable properties. While I appreciate that negotiations with the Association of British Insurers have been complex and that there is no easy solution, especially with the current fiscal situation, it is not as if we did not see this coming—it has been coming since the statement of principles was agreed in 2002.

If we are not going to hit the deadline, we need to be clear and transparent with constituents about what will happen between then and any future deal. Until now, the line has been not to undermine negotiations by giving a running commentary on them. That is not unreasonable and had an agreement been reached in time, I think that all would have been forgiven, but people need to know now how to protect themselves. Ministers have been clear about their priorities, which are to ensure that flood insurance remains widely available, affordable and fiscally sustainable. Nobody is going to argue with any of those principles, but they will not help householders to work out how to plan for their financial future.

I therefore ask the Minister the following questions. On the stroke of midnight on 30 June, will we have a free market or will we have some kind of interim extension of the statement of principles? If it is the latter, have there been any discussions about what form it will take? If the Government are going to let the free market emerge in the interim, will Ministers let it be genuinely uncontrolled, with all the pricing risks that holds, or are they considering regulation? If so, what kind of regulation, and how and when? On “Flood Re”, the current cross-subsidy is £8. Yesterday the ABI told me that the proposed levy would also come to £8, but it would have to be formalised as a tax. However, the National Flood Forum brief estimates the levy at £13. What assessment have the Government made of the levy and what mechanism would they need to regulate it? Finally, what measures are being considered to incentivise flood defence investment on a personal, local and national level? That is the only responsible way to manage flood risk on an ongoing basis.

I accept that it takes two to tango. I met the ABI yesterday and I made those points, but I am afraid that today it is the Minister’s turn. My constituents deserve to know whether their homes will be insured in July and on what terms. They deserve at least that measure of certainty, even though they live in a flood-risk zone.

--- Later in debate ---

[Julian Sturdy]

I entirely agree with my hon. Friend. I have a number of constituents in the same boat who bring the same concerns to me.

Given that the statement of principles comes to an end in June, the future looks very uncertain for many of my constituents and those of Members throughout the House, so I welcome the motion today. I want to focus on a village in my constituency situated to the south of York, on the banks of the River Ouse. Large parts of Naburn are at a significant risk of flooding. Late last year, I was contacted by a Naburn resident who informed me that, over the past 37 years, his property has been badly flooded on four separate occasions. In the six months since last autumn’s terrible wet weather, some homes in Naburn have been flooded numerous times. Thankfully, the people of Naburn have a strong sense of community spirit. They are Yorkshire folk, after all, and they are starting to pull together to do all they can to reduce their collective flood risk.

Following a public meeting in the village in November, the parish council and a group of interested residents set up a working group to investigate inexpensive and cost-effective measures that they can swiftly enact to help them deal with flooding before it affects their properties.

[Nicola Blackwood]

I suspect that my hon. Friend is about to describe a flood group like the Oxford Flood Alliance, which he and I are familiar with. It plays a huge role in reducing flood risk in Oxford by coming up with flood plans, mitigating flood risk in communities and developing flood resilience. Does he agree that this is a really important thing to encourage, and that any future flood insurance scheme must encourage such developments?

[Julian Sturdy]

I entirely agree with my hon. Friend. Local flood groups are very important for our communities. I am sure that, like my community flood group, my hon. Friend’s is working hard with the Environment Agency, the local authority and the local water and drainage boards to improve flood resistance capabilities.

Some ideas that have been considered include allowing local residents to have control over mobile pumping units and sandbag storage and delivery and to use their local knowledge to protect the most vulnerable people. We must not forget that there are some severely vulnerable people in flood-risk areas, and we must make sure that they do not become isolated by flooding. Independently, many people are considering making flood resilience improvements to their own homes.

The hard work, positive action and sense of resolve that I have witnessed in Naburn is extraordinary, and the community should be commended for its collective approach to the problems that it faces. I am well aware that, as has been pointed out, there are similar stories across the country of communities coming together to battle the difficulties of flooding, and they should all be commended.

--- Later in debate ---

[Penny Mordaunt (Portsmouth North) (Con)]

I, too, congratulate my hon. Friend the Member for Esher and Walton (Mr Raab) on securing this debate. I am grateful for the chance to speak, because many of my constituents, especially in Paulsgrove, Cosham, Drayton and Farlington, have been affected by these issues.

We have good sea defences in Portsmouth, but we have a very dilapidated sewerage and drainage system that has caused many of the problems on and around the Portsdown Hill area. A programme of works is now in place to rectify those problems, and so far we have been able to protect local people from the increases in their insurance premiums as they have had to submit repeated claims for repeated flooding and sewerage leaks.

I agree with many of the points that have been made, and I will not go over them again. I wish to touch on two additional issues that add insult to injury. The first of these is planning. Planning applications are approved even when the new build is on a serious floodplain. An applicant for a dementia care home in my constituency attempted to placate the planning committee by saying—I kid you not—that because the building was high-rise, if there were a flood the residents would be able to get to high ground. The application was approved. The advice of local planning committees and the Environment Agency is often ignored, or their decisions overturned.

I hope that there could be an incentive for a slightly more responsible stance on these issues. There is a gap in the market for an “Environment Agency Says No” website, so that whether it is a house or a care home place being purchased, the consumer would be able to check whether the agency has given the site and the development the thumbs up.

[Nicola Blackwood]

My hon. Friend is making some excellent points about Environment Agency approval of floodplains. She began by talking about dilapidated sewerage systems. Does she agree that we need to include Thames Water more in decisions about planning, because a lot of our drainage systems are causing problems with surface water flooding?

[Penny Mordaunt]

My hon. Friend is right. The Environment Agency has told me that it would like to be more involved with such planning decisions and there are many other organisations that we should take advice from.

The transparency that I have described would not deal with current cases, but it would head off future grief by providing an incentive for developers to behave more responsibly.

The final issue that I will touch on is compensation for deliberate flooding. There have been cases in my county, although not in my constituency, of landowners having their land flooded deliberately by the local authority to prevent greater damage elsewhere. That is quite understandable, but in such cases the landowner should be able to access some form of compensation. I would be grateful for the Minister’s views on that.

Finally, I congratulate the Backbench Business Committee, my hon. Friend the Member for Esher and Walton and all Members who have made possible this timely debate on an important issue.