Future Flood Prevention

Debate between Nigel Evans and Mary Creagh

Monday 27th February 2017 Commons Chamber

[Mary Creagh]

The hon. Gentleman is absolutely right: there is market failure in these areas. Businesses are encouraged to shop around, and there are some excellent community Flood Save schemes, where people try to get together to use market power to purchase insurance collectively, and one of those schemes is now up and running in Calderdale, but it should not have to come to that. We want to see insurance companies standing alongside communities. The insurance companies lobbied long and hard to mitigate their risk from climate change, and the Government set up the Flood Re scheme —another insurance tax on contents premiums and buildings premiums, with every homeowner in the country stumping up for the access risk so that the insurers do not have to pay it and can transfer it to the Government. Insurers need to cut businesses some slack and rise to meet some of these challenges.

[Mr Evans]

A few businesses in my area have been hit. One of them is relatively small, but it has been hit a couple of times by flooding, so the insurance premium is now running way into the thousands. The premises is also a mixed hereditament, which makes things more complicated, because people live where the business is. Surely, if Flood Re kicks in to help domestic premises, it should kick in for businesses as well. If there is a market failure, which I believe there is, and if it is suitable to have that sort of pooling of risk for houses, it should be the same for businesses.

[Mary Creagh]

It is important that we do not end up with every taxpayer subsidising the private sector. The Government need to look again at the use of different, innovative mechanisms that do not place yet another burden on the already hard-pressed householder or car driver who has seen their insurance premiums go up as a result of mitigating and pooling some of this risk.

Failing to fund flood defences adequately is playing Russian roulette with people’s homes and with people’s businesses. I have talked about my Committee’s concerns about rollercoaster funding instead of steady-state funding; vague targets; vulnerable transport, energy and digital infrastructure, where again the Government simply lack the political will to work with companies across Government to get them to have flood-resilient assets; and local councils left to just get on with it by themselves. The storms may have receded for the moment, but the clean-up in some areas of Yorkshire, and in other areas across the country, is still going on. The lessons that we draw from this debate and these two Committee reports will shape our winters and our summers for decades to come.