Flood Insurance for Businesses

Debate between Stuart Blair Donaldson and Craig Whittaker

Monday 8th February 2016 Commons Chamber

[Craig Whittaker]

I am not quite sure that that is entirely the Government’s responsibility. The ABI has a huge responsibility for this too. As I shall highlight with the things that have been done in the Calder Valley—doubtless they have been done in York Central too—it is the responsibility of business, but it is also everyone’s responsibility to make sure that we have viable businesses, otherwise we do not have communities going forward.

[Stuart Blair Donaldson (West Aberdeenshire and Kincardine) (SNP)]

I apologise to the hon. Member for Calder Valley (Craig Whittaker) and to you, Mr Deputy Speaker, for arriving late. The hon. Gentleman has made an important point about the ABI. Does he agree that another way to help businesses and communities affected by flooding is for the Government to apply to the EU solidarity fund to ensure that more support is available for those businesses and communities?

[Craig Whittaker]

As the hon. Gentleman knows, the Government have given a commitment to look at that funding to see how they can help. I dare say the Minister will give us an update on that.

Of the many businesses across the Calder Valley which are experiencing these difficulties, I will cite just three of the many examples coming in daily to illustrate some of the concerns that I have become aware of. I will not name the companies as we do not want their customers to lose faith any more than they have already. The first is a leading high-end British furniture manufacturer located in Mytholmroyd which is experiencing difficulties similar to those faced by other businesses. It is a very successful manufacturer of sofas, employing some 100 local people. On Boxing day, it was flooded for the second time in just four years. After the last flood it could get insurance only for stock, not for machinery or anything else relating to flooding. It is facing a loss of around £500,000. The business will survive and continue, but of significant concern is the insurance position going forward. Its insurance cover was due for renewal only last week and it has been told that it will not be able to access flood cover again, even for stock.

At the other end of the Calder Valley, located in Brighouse, is a nationally acclaimed climbing centre which opened in 2011 and now has over 30,000 members. Together with its sister business, a bar and a restaurant, it employees 30 local people and occupies a strategic site that is central to the regeneration of the wider area. As the business is located between the river and the canal, it has been unable to access any flood insurance since it was set up. The business incurred losses when it was flooded in 2012 and now, following the latest floods, it faces a very substantial bill and a battle to stay in business. Once again, the business is in limbo.

Last but by no means least, I will mention a large manufacturing firm which has been flooded on four separate occasions over the past decade. The business has been able to access flood insurance in the past, but has been told in no uncertain terms by its insurers that it will not receive flood cover in the future. Its inquiries of other insurers have been unsuccessful on account of the ridiculous terms and conditions that have been quoted. The difficulties in accessing insurance, and the losses incurred by being flooded so regularly, now mean that it is likely that this business will close, with the loss of 40 jobs.