3 Flood defences
19. Increasing flood risk is the greatest threat
from climate change in the UK.[46]
The chance of a catastrophic flood in England within the next
20 years (one causing over £10 billion of damage) was assessed
by the ASC as around 10%.[47]
The ASC calculated that:
In 2014-15 almost three-quarters of the flood
defence systems in England will not be maintained according to
their identified needs. This is despite additional maintenance
funding being provided by the Government after the 2013-14 winter
storms.[48]
The National Audit Office concluded that as of December
2013 five million homes were at risk of flooding in England.[49]
Investment plans
20. The Government has committed £2.3 billion
of capital funding for flood defences up to 2021.[50]
Subsequently, Defra published its Six-year investment plan
in 2014,[51] detailing
where this money will be invested, and the Environment Agency
published a renewed Long-Term Investment Strategy in 2014.[52]
The Defra Secretary of State has announced that this funding will
protect over 300,000 properties, reduce flood risk by 5% and save
the economy £2.7 billion by 2021.[53]
Our ASC witnesses welcomed the announcement of these flood investment
programmes. Daniel Johns told us that:
The long-term investment scenario is exactly
what we would like other sectors to be doing: looking that far
ahead, looking at a range of different climate scenarios, and
then making sensible investment choices in the context of that
evidence.[54]
21. Lord Krebs cautioned, however, that even with
the new flood defences, flood risk will still increase in the
future. He told us that "we are investing … quite a
lot of money in flood defences, but not enough to protect homes
at the same or equivalent level of risk that they are protected
at today".[55] The
ASC found that:
Despite the [flood] defences in place …
Kingston-Upon-Hull can expect the most river and coastal flooding
over time. As well as some households in the high and very high
flood risk categories, Hull has 100,000 households in the medium
and low flood risk categories. This risk profile means there might
be little flooding year to year, interspersed by occasional very
significant flood damage.[56]
22. Paul Crick from Kent County Council told us that
"the Environment Agency very rarely now 100% funds schemes".[57]
The Environment, Food and Rural Affairs Committee calculated
that "in order to deliver on their flood investment programme,
Defra will need to make efficiency savings of at least 10% and
attract external contributions (e.g. through partnership funding)
of £600 million or more".[58]
Dan Rogerson outlined some of the details of that 'partnership
funding' process:
This is a six-year programme and many of these
schemes have been discussed in local areas for a long time. There
is a huge head of steam behind the delivery of those, for communities,
and all the departments coming together … Some of these are
very big schemes but even right down to some quite small schemes
there are ways in which local authorities, businesses and others,
can pull things together.[59]
He felt it was important to bring in money from outside
Government to ensure as many schemes as possible could go forward,
but also so that those contributing could see the value of what
was delivered.[60]
23. Paul Leinster, Chief Executive of the Environment
Agency, told us that the partnership funding approach had set
in place
a consistent set of criteria that all risk management
authorities have to abide by. That sets a tariff and you get money
for the number of houses protected, for the amount of farmland
protected, for habitat created, but it is a transparent system
that everybody sees and it is a level playing field for all authorities.[61]
As a result, for some schemes the Government will
provide 100% of the funding, but for others the local authority
will need to get funding from private partners.[62]
We heard that some local authorities were having difficulty in
finding private partners. In 2014-15, only £40m of the £148m
coming from outside central government was from private sources.[63]
24. We heard that one of the key obstacles to funding
flood schemes was the way in which premises were valued. Paul
Crick told us that schemes to protect residential properties received
a higher benefit-cost ratio in the Environment Agency scoring
than schemes to protect business premises, which therefore require
a greater contribution from partnership funding.[64]
25. Allen Creedy from the Federation of Small Businesses
(FSB) explained that in a recent survey of FSB members many were
"relatively positive about working in partnership with the
Environment Agency and … there was a willingness even to
make financial contributions and to assist in design." But
he cautioned that in order to invest, small businesses "were
looking for something back" such as reductions in premiums
or rates.[65] Paul Leinster
of the Environment Agency was concerned about the overall feasibility
of the flooding targets:
Going forward, the conditions that have been
applied to that additional money is 300,000 more households being
protected, a further 10% efficiency and to bring at least 15%
of the funding in from partnership funding. We believe that we
will have to do more than that to meet that 300,000 household
target.[66]
SOMERSET LEVELS
26. The challenge of flood defence planning is made
more difficult by having to adjust plans in response to specific
events. The ASC noted that after the 2013-14 winter flooding,
the Government committed an additional £20.5 million towards
the Somerset Levels and Moors action plan, without a cost-benefit
assessment. The post-flooding dredging work cost £5.7 million,
which the ASC calculated delivered flood risk benefits of only
£1.90 per £1 spent.[67]
Daniel Johns told us he was concerned that, with funding scarce,
the additional money made available for the Somerset Levels might
have been at the expense of more cost-effective investment elsewhere,[68]
and indicative of a reactive approach to flood investment:
The question is whether you should have a flood-risk
management strategy that is reactive and try to build defences
where it flooded last, or if you should try to build defences
where it is most likely to flood next and can deliver the most
benefit. Obviously, the strategy should be the latter, and we
recognise that given severe events—the Somerset Levels have
obviously experienced widespread flooding for a period of time
and lots of damage was caused—at the same time when there
is limited funding, you have to be aware of those kinds of trade-offs.
If you are spending money in some parts of the country, you are
not spending that money elsewhere.[69]
27. Dan Rogerson acknowledged that there was some
criticism of the money provided for the Somerset Levels, "where
the number of properties inundated was much lower than in other
areas". He considered that the money was required because
the duration of the floods meant that "'there were much wider
impacts that we needed to deal with".[70]
Soft flood defences
28. Alex Nickson of the Local Adaptation Advisory
Panel told us that:
Increasingly what we are looking at is not just
delivering flood defences as a comforting concrete wall between
you and something wet, it is about using green infrastructure
that enhances businesses, enhances quality of life, attracts and
retains inward investment. Some of that is just not captured and
valued because the partnership funding score's ancestry is in
coastal flooding and it is designed to reduce the total number
of homes, so it is about quantity rather than perhaps the quality
of flood risk reduction.[71]
The Woodland Trust told us that there was evidence
that sustainable land management, including tree-planting could
offer significant adaptation benefits, including flood alleviation.
For instance, they told us about
a farmer led approach to sustainable land management
in the uplands which found that tree planting had major benefits
in reducing water run-off and improving water quality from improved
grassland. The project demonstrated that planting tree belts across
the slopes led to increased infiltration of water into the soil—more
than 60 times that of neighbouring sheep grazed pasture without
tree belts. When this effect was modelled across the catchment
the result was a potential reduction in peak stream flows of as
much as 40%.[72]
The Woodland Trust saw this as "clear evidence
that integrating trees into upland farms could play a part in
reducing flood risk downstream".[73]
29. Sarah Mukherjee from Water UK explained, however,
that research into such 'soft' flood defences was still an early
stage, and that Ofwat:
have been quite challenging, and rightly so,
about it because they want to make sure that the money we are
spending on this has a direct customer benefit and is not just
a whole load of good things for the environment without being
able to show that we can reduce customers' bills or keep them
flat as a result.[74]
Certain farming practices are adding to flood risk.
In the wake of the dramatic flooding of last winter, the ASC wrote
to the Environment Secretary to highlight the "wider drivers
of flood risk … such as some agricultural practices".[75]
Likewise, Daniel Johns felt "it would be unfair to expect
the taxpayer to fund [land management schemes] when it might just
exacerbate the problem [and] in some cases is due to inappropriate
farming practices".[76]
Dr Ceris Jones from the NFU wanted to see a conversation started
"with the farmer about those areas of the farm that are least
productive that might be suitable for flood risk management and
how farmers are recognised for that contribution".[77]
Green Alliance said that "climate adaptation measures on
farms should be rewarded through farm payments".[78]
Dan Rogerson, though positive about the potential for soft flood
defences to deliver wider benefits, cautioned that "it is
quite often easier to be definite about what the effect will be
if you have a hard defence".[79]
30. The Natural Capital Committee has been examining
how the valuation of natural capital benefits, such as those from
soft flood defences, might be used in policy-making. The NCC's
first report in 2013 set out a "framework that will help
natural capital to be hard wired into economic decision-making
in this country … so that we can better understand which
of our natural assets are critical to our well-being".[80]
In their second report, it presented a preliminary analysis of
the state of natural capital in particular areas and identified
those at high risk, including "protection from natural hazards"
such as flooding.[81]
The NCC's third report, published earlier this year, repeated
its earlier call for Government to work with business and NGOs
in developing a strategy and supporting 25-year plan to protect
and improve natural capital.[82]
That strategy needed to be underpinned by three components: a
robust and consistent 'measurement', 'accounting' and 'valuation'
of natural capital. Investments in natural capital could "deliver
significant value for money and generate large economic returns".[83]
The NCC singled out the potential in eight specific areas, most
of which could help to reduce the likelihood or impact of flooding—woodland
planting, peatland restoration, wetland creation, intertidal habitat
creation, urban greenspaces and improving the environmental performance
of farming. The private sector and civil society have a significant
part to play, the NCC said, because they own or are responsible
for the majority of natural assets. Its report sets out a range
of different funding options these include: capital maintenance
payments from natural capital asset owners:
Some form of transfer is required from the social
benefactors [of ecosystem services] to the private owners [of
natural capital assets] to ensure that organisations are fully
compensated for the benefits that they provide to others through
maintenance of their natural assets. This could take the form
of a subsidy or of a private payment though some form of Payment
for Ecosystem Services. Our accounting framework provides a robust
method for calculating the appropriate level of transfer and monitoring
its ongoing delivery should Government, the private sector or
a charity wish to fund the provision of public goods on privately
owned land.
Conclusions
31. Flooding is the biggest adaptation risk, and
will increase even if significant resources are devoted to it.
The Government has sometimes followed what the ASC has called
a 'reactive' funding strategy, prioritising the most recent flooding
events rather than long term objective needs.
32. Funding for flooding adaptations must be sourced
and matched against the value of the benefits available. The challenge
is to balance the revenue to natural asset owner against the needs
of potential beneficiaries, who currently do not fully pay for
those reduced-flooding benefits. The Natural Capital Committee's
work is at the heart of this question and it has been doing invaluable
research in this area.
33. The Government should make a clear commitment
to allow the Environment Agency to allocate flood defence funds
according to its objective cost-benefit models without political
interference.
34. The Government has indicated that it will
leave it to the next Government to decide the NCC's long-term
future. The NCC's work on valuing ecosystem services, including
those providing 'soft' flooding defences, show its importance
for climate change adaptation, but also offers the prospect of
finding funding mechanisms to link natural capital 'owners' and
adaptation beneficiaries. The next Government must act as quickly
as possible to put the NCC on a long-term footing, and encourage
it to develop those funding mechanisms.
46 ASC, Managing climate risks to well-being and the economy
(July 2014), p33 Back
47
ibid, p33 Back
48
ibid, p27 Back
49
NAO, Strategic flood risk management, (November 2014), p4 Back
50
Defra, Reducing the threats of flooding and coastal change Back
51
Defra six-year investment plan
(December 2014) Back
52
Environment Agency Long-Term Investment Strategy
(December 2014) Back
53
Defra, "Government press release: £2.3 billion to be spent on new flood defences"
(2 Dec 2014) Back
54
Q272 Back
55
Q272 Back
56
ASC, Managing climate risks to well-being and the economy (July
2014), p35 Back
57
Q21 Back
58
Environment, Food and Rural Affairs Committee, Eighth Report of
Session 2014-15, Defra performance in 2013-14 HC802, para 31 Back
59
Q317 Back
60
Q318 Back
61
Q81 Back
62
Q81 Back
63
Defra, Reducing the threats of flooding and coastal change Back
64
Q21 Back
65
Q204 Back
66
Q85 Back
67
ASC, Managing climate risks to well-being and the economy (July
2014), p45 Back
68
Q275 Back
69
Q275 Back
70
Q319 Back
71
Q16 Back
72
Woodland Trust (CCA0037), para 7 Back
73
Woodland Trust (CCA0037), para 7 Back
74
Q101 Back
75
ASC, Managing climate risks to well-being and the economy (July
2014), p23 Back
76
Q277 Back
77
Q105 Back
78
Green Alliance (CCA0021) Back
79
Q315 Back
80
Natural Capital Committee, The State of Natural Capital: Towards a framework for measurement and valuation
(April 2013) Back
81
Natural Capital Committee, The State of Natural Capital: Restoring our Natural Assets
(March 2014) Back
82
Natural Capital Committee, The State of Natural Capital: Protecting and Improving Natural Capital for Prosperity and Wellbeing
(January 2015) Back
83
ibid, p7 Back
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