Flooding Contents

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3Development and flood risk

National planning policy

70.The previous EFRA Committee’s interim report on Coastal flooding and erosion, and adaptation to climate change in November 2019 noted concerns that Government housebuilding targets may be leading to councils allowing inappropriate development in areas at risk from flooding.154 The Environment Agency says that the total number of properties at risk from flooding would almost double over the next 50 years if current planning outcomes continue, although it noted that this is mainly due to development in low risk areas.155 National planning policy is that inappropriate development should be avoided, and instead alternative lower risk locations should be identified. Where this is not possible, the proposed development should be made safe without increasing the risk elsewhere.156 The National Planning Policy Framework (NPPF) states that local plans should apply the “sequential test” (aimed at steering new development to areas with the lowest risk).157 If it is not possible for development to be located in lower risk zones, the NPPF states that the “exception test” may need to be applied, demonstrating that the benefits of the development outweigh the risk, and that it will be safe for its lifetime.158

71.We have heard concerns that national policy does not adequately address the increases in flood risk that are possible with climate change. CIWEM told us that “there is a risk that the current standards set by the requirements of the exception test and climate change allowances will not be sufficient to ensure safety and resilience across a development’s lifetime”.159 Professor Richard Dawson, of the Climate Change Committee’s Adaptation Committee, likewise told us that the risk will “move towards exponential rates if we continue to grow at the current rate”, urging that “we need to put the brakes on a little bit more”.160

72.The proposals in the Government’s planning White Paper, published in August 2020, would provide for automatic outline planning permission for the principle of development in “Growth areas” (those areas identified in local plans as “suitable for substantial development”).161 The White Paper states that “areas of flood risk” would be excluded from Growth areas, “unless any risk can be fully mitigated”.162 Professor Richard Dawson, of the Climate Change Committee’s Adaptation Committee, said of the Planning White Paper that “there is actually very little there on flood risk management”.163 He called for central leadership, such as from the Cabinet Office or Treasury, to “pull these strategies, different planning policies and so on together”.164 Blueprint for Water’s Ali Morse also highlighted the White Paper’s proposed removal of the duty for local planning authorities to co-operate, which she called “quite concerning in terms of flood risk management”.165

73.It is widely recognised that inappropriate development in areas at risk from flooding represents a serious threat to flood resilience, particularly as the scale of the risk is likely to increase with climate change. Defra must do more to integrate its approach to flood resilience across the whole of Government, and this must include greater interaction between planning policy and approaches to managing flood risk. The Government should explain how its proposals for planning reform will contribute to better flood resilience outcomes than the current planning system. It should also explain how leadership will be provided within Government so that flood risk and planning policies are integrated within a coherent approach to climate adaptation.

Advice from risk management authorities

74.As a statutory consultee, the Environment Agency comments on development proposals (other than minor development) in areas that are at medium or high risk of flooding from rivers or the sea, as well as proposals within 20 metres of a main river, or in an area with critical drainage problems.166 The EA told us that 99.4% of new homes included in planning applications were determined in line with EA advice in 2018/19, and that “current planning policy is very effective at limiting inappropriate development in the floodplain”.167 Professor Richard Dawson, of the Climate Change Committee’s Adaptation Committee, said that “as a general proportion, it is around 7% to 11% or so of applications that have gone through against [the EA’s] advice”, and that “in some cases this seems like a small number, but it all adds up”.168

75.We heard calls for greater transparency about decisions taken against EA advice. The Association of British Insurers called for “a mandatory responsibility to report publicly on planning decisions in a clear and transparent way, especially when decisions have been taken against EA advice”.169 EA Chief Executive Sir James Bevan also highlighted that the EA is only a statutory consultee for development in areas of existing flood risk, and that the EA would be “interested in extending our role” to be consulted on development in areas “that are also at flood risk because of climate change”.170

76.Lead Local Flood Authorities also undertake a statutory consultee role, providing technical advice on surface water drainage for major developments.171 Paul Cobbing of the National Flood Forum stressed that “the vast majority [of planning applications] have nothing to do with main rivers and nothing to do with the Environment Agency”.172 He told us that staff performing this role within LLFAs are often very junior and doing the job alongside other roles, and said that “whether those comments are actually taken into account is going to be the big area that we need to work on”.173 We have made recommendations around resourcing of local authorities in Chapter 1 of this Report.

77.It was also suggested to us that more needs to be done to ensure that developers follow through on commitments to ensure that at-risk development is made resilient. Environment Agency Chief Executive Sir James Bevan said that “we do not have the resources, neither do the local authorities, to go and check if the developers have done what they promised to do, or to make them do what they did not do”.174 He said that “there is an issue there about resourcing either us or the local authorities better to police development decisions”, and also suggested the approach of requiring developers to post a bond to guarantee the required flood risk mitigations.175

78.The Government has said it will review policy for building in areas at flood risk, assessing “whether current protections [ … ] are enough” and considering “options for further reform”.176 This includes “consider[ing] what more can be done” in cases where the EA’s advice is not followed.177 In oral evidence, the Secretary of State provided further detail on the measures under consideration, including decisions at Ministerial level about whether to “call in” applications where EA advice had not been followed.178 The July 2020 policy statement also said that the Government will “consider ways to boost transparency, data collection and reporting” where EA or LLFA advice is given.179

79.We are concerned that the words on flood risk in national planning policy still do not always translate into actions. We are encouraged by the Government’s proposal that planning applications approved against flood risk advice could in future be subject to call-in by the Secretary of State. The Government should provide further detail on its proposals for cases in which flood risk advice on planning applications is not followed. The remit of the Environment Agency as a statutory consultee should be expanded to include areas of future risk owing to climate change.

80.While we welcome the commitment to consider improving transparency for flood risk advice, the Government must ensure that any development which still goes ahead against advice is clearly communicated to prospective homebuyers. The Government should ensure that information on development against flood risk advice is published in a clear and accessible form.

81.It is clear that planning and risk management authorities must be empowered and resourced to effectively monitor and enforce the fulfilment of planning conditions in areas at risk of flooding. The Government should urgently review whether planning conditions to mitigate flood risk are being fulfilled. The Government should then bring forward proposals to address any limitations in the powers and resources available to appropriate authorities for the enforcement of planning conditions.

Cumulative development

82.Submitters also raised concerns that the EA has less ability to comment on smaller applications which make up the bulk of planning decisions. The Town and Country Planning Association (TCPA) told us that in 2019, there were 6,000 applications for major housing developments, but 39,000 applications for minor developments.180 Although national planning policy is that strategic policies should consider “cumulative impacts”, the National Flood Forum said the risks are “totally ignored”.181

83.Permitted development also plays a role, with the NFU providing the example of front gardens being replaced with hard surface car parking, with water running off directly to the drain.182 The NFU said that exercise of this permitted development right above a certain threshold theoretically includes conditions relating to porosity, but told us that “in practice they are often not enforced”.183 The National Flood Forum also highlighted the cumulative impacts of permitted development, which it said “poses some of the biggest risks to peoples’ lives by placing them at greater flood risk and reducing the options for adaptive solutions”.184

84.We put concerns about cumulative impacts to MHCLG Minister Lord Greenhalgh. He said that it is “absolutely right that you do need to have regard to the cumulative impact”, and indicated that the Secretary of State for Housing, Communities and Local Government would “listen to this Committee and act upon your advice” regarding this issue.185

85.We welcome the Government’s commitment to act upon our recommendations regarding the cumulative impact on flood risk of smaller developments. While we recognise that national planning policy does refer to cumulative impacts, this has clearly not allayed concerns that these impacts are not given due regard when planning decisions are made. The Government should, as part of its review of planning policy for flood risk, establish to what extent flood risk is increased by the lack of scrutiny given to the cumulative impacts of smaller and permitted development.

Local capacity and knowledge

86.Evidence to our inquiry suggests concern over the capacity of local planning authorities, and the quality of information available to them. The Association of Drainage Authorities said that, outside of areas with a unitary structure, planning authorities are typically not LLFAs and can therefore lack “sufficient technical expertise”.186 A survey conducted by the Town and Country Planning Association found that “just 12% of local authorities strongly agree that they have the skills and expertise to take account of flood risk now and in the future in planning decisions”.187 The TCPA’s Hugh Ellis explained that there is “an enormous deficit in resources for councillors in climate change”, and “very little awareness” of the Environment Agency’s flood risk allowances despite these being published online.188 Professor Richard Dawson, of the Climate Change Committee’s Adaptation Committee, said that “very few local authorities have the resources to even have one full-time person” working on climate change adaptation.189

87.In the light of its survey findings, the TCPA told us that local authorities require “more information regarding the expected impacts of climate change in the local area; and knowledge of how to incorporate climate projections into planning decisions”.190 Professor Dawson recommended that local authorities be resourced for full-time staff working on adaptation, and that “national capacity” be provided to train these staff as “some of these decisions need to be taken across multiple local authorities because of the physical boundaries of how water likes to move”.191 Planning reform is also part of this dynamic, with CIWEM noting that “if there is a direction of travel towards the primacy of local plans within land use planning, as set out in the white paper, feeding in the right information on flood risk and land use at the local plan stage will be even more critical than presently”.192

88.MHCLG Minister Lord Greenhalgh’s response to evidence about the capacity of local planning authorities on climate change was that “I do not really recognise the fact that there is not enough money to do a proper job”.193 The Government has also said that its review of planning policy with regard to flood risk will include working with the EA to support planning authorities in “receiving and understanding the appropriate expert advice on all sources of flood risk”.194

89.We are very concerned that local planning authorities lack the skills base and resources to effectively factor the impacts of climate change into development decisions. While plans and individual decisions are rightly made at a local level, it is the duty of Government to provide leadership to local authorities facing potentially significant increases in future flood risk. The Government should commit to ensuring that all local planning authorities have the powers, resources and information to effectively factor current and future flood risk into local plans, Strategic Flood Risk Assessments and individual decisions, including properly trained dedicated staff. The Environment Agency should work closely with such staff to improve strategic co-ordination around local plans. The Government should urgently undertake, and publish the findings of, a review of current capacity in local planning authorities to perform this function.

90.Alongside a lack of professional skills in some planning authorities, a recurring theme of the evidence we received was that community knowledge of flood risk is not taken into account in local plans and individual decisions. The National Flood Forum told us that “often communities become engaged in planning and development far too late in a process when decisions have already been made”, such as in the development of local plans.195 Hugh Ellis of the TCPA told us that local knowledge can “map that detail in ways that professional knowledge is often at too high a level to understand”.196 The Caterham Flood Action Group told us that the omission on flood maps of hydrological features known to residents “renders us powerless to challenge inappropriate planning applications”.197 The National Flood Forum suggested requiring local plans, Strategic Flood Risk Assessments and developers’ site-specific Flood Risk Assessments (FRAs) to demonstrate how they have utilised local evidence, and that there was a need for detailed national guidance on involving local communities in providing evidence.198

91.Some stakeholders have also raised concerns that planning reforms will remove an element of community input, including in our roundtable with community groups in October.199 In oral evidence Hugh Ellis said that, while it is not clear whether the planning White Paper will make “any beneficial difference” with respect to flooding, “it is clear that it would make people’s voice in the process more difficult”.200 However, MHCLG Minister Lord Greenhalgh described suggestions that the White Paper would remove local input as a “fundamental misunderstanding” of the proposals.201

92.The engagement of communities in the development of local plans is already inadequate, and the proposed reforms to the planning system must not compound this problem. Greater community involvement in planning decisions in many areas at flood risk would have the twin benefits of building trust and contributing valuable technical knowledge about drainage issues. The Government should develop national guidance on incorporating local knowledge of flood risk into planning decisions, the development of local plans and the preparation of strategic and site-specific Flood Risk Assessments. We make further recommendations about community engagement in Chapter 5 of this Report.

Supporting information

93.Site-specific Flood Risk Assessments (FRAs) are prepared by, or on behalf of, planning applicants.202 The Caterham Flood Action Group recommended that FRAs could be improved by instead being carried out by “an independent body” (the Lead Local Flood Authority was proposed) at the developer’s expense.203 The National Flood Forum also called for FRAs to consider whether water leaving a site will have impacts on flood risk interventions elsewhere in the catchment.204 The planning White Paper proposes streamlining of the planning application process including “greater standardisation of technical supporting information”, including about flood risk, with “clear national data standards and templates developed in conjunction with statutory consultees”.205

94.We recognise the concerns of several stakeholders about site-specific Flood Risk Assessments, and the Government should use its reform of the planning system as an opportunity to investigate this issue further. The Government’s standardisation of technical supporting information should include an evaluation of the current arrangements for the preparation and content of site-specific Flood Risk Assessments, and whether these adequately contribute to flood resilience objectives and public confidence.

Making properties more resilient

Property flood resilience

95.As well as limiting new development in areas at risk of flooding, our inquiry also considered measures to make buildings less vulnerable to flooding (referred to as property-level flood resilience, or PFR/PLR, measures). These include measures to prevent flood water from entering a property, and measures to reduce the impact if flooding does occur.206 Examples include installing flood doors, air brick covers, and non-return valves, and moving vulnerable features such as sockets above floor level.207

96.The Environment Agency calculated in 2019 that it would be cost-effective to invest in PFR for over 200,000 residential properties.208 However, the Climate Change Committee has highlighted that there are no plans for how to achieve such a level of uptake.209 In 2019, the CCC said achieving this uptake by 2039 (when Flood Re is due to be withdrawn) would require a rate of over 9,000 properties having PFR installed every year, but the current figure is closer to 500 per year.210 In its five-yearly review in July 2019, Flood Re recommended that the reinsurance scheme should offer lower premiums on policies where PFR measures have been installed and allow payment of claims that include a limited amount of resilient and/or resistant repair above the flood-related loss.211 The Government launched a consultation on making these changes to the Flood Re scheme in February 2021.212 However, the ABI stressed that the success of these proposals “will still be dependent on continuing to address the barriers to uptake of flood resilience measures”.213 We make recommendations about insurance in the next section.

97.Some of the evidence we received suggests that there needs to be better sharing of best practice and quality assurance on PFR. We heard several suggestions of how information on the effectiveness of PFR measures could be better disseminated, including Flood Re’s recommendation of “Flood Performance Certificates” to provide information to homebuyers on flood risk and potential resilience measures.214 At the same time, we have heard suggestions that there needs to be more communication of evidence on the effectiveness of PFR. Zurich Insurance told us that there is a lack of evidence about “which pre-event resilience-building initiatives actually make a difference when a flood comes”, and the ABI likewise said that sharing evidence on the reduction in damage and costs achieved by resilience measures would help insurers take them into account.215

98.There have also been continued calls for amendments to building regulations to promote PFR installation. The LGA told us it would like to see building regulations amended “to include mandatory flood protection measures for new properties”, requiring developers to include measures such as raised electrical sockets, fuse boxes, controls and wiring, sealed floors, and raised damp-proof courses.216 CIWEM recommended that “flood resilient design must become an intrinsic part of building regulations”, while Zurich Insurance also said that building regulations could “provide a set of resilience standards that need to be met when properties that have been flooded are being reinstated”.217

99.We have also heard recommendations for more Government financial assistance for the installation of PFR measures. Referring to the property resilience grant scheme made available after the 2019–20 floods, Zurich Insurance called for grants to be available year-round and able to be administered by insurers.218 Flood Re also told us that “introducing a better grant scheme for installation of PFR measures could incentivise people to take action”, and recommended that the Government’s new “Green Homes Grant” scheme should be extended to “provide grants designed to help people install PFR measures”.219

100.The Government’s July 2020 flooding policy statement committed to “explore ways to provide greater clarity about the use and effectiveness of property flood resilience measures”, with further details to be published on how to “further boost uptake of property flood resilience in homes and businesses across the country”.220 Separate to the consultation on changes to Flood Re, a Defra call for evidence was also launched in February 2021, seeking information on ways of accelerating uptake of PFR.221

101.A step change is needed in promoting the uptake of appropriate property flood resilience measures. It is important that reforms to Flood Re to incentivise PFR form part of wider work aimed at encouraging people to improve the flood resilience of their own property. We welcome the Government’s call for evidence on ways to accelerate PFR uptake, and the findings of our inquiry should inform this work. Following its current call for evidence, the Government should publish an action plan of new measures to deliver a significant increase in the uptake of property flood resilience, including identifying where more evidence is needed on which measures will be most appropriate and effective. The Government should consult on amending building regulations to ensure an ambitious level of flood resilience in new build and reinstatement works. The Government should also consider developing a consistent national funding stream for PFR measures.

Insurance

102.Flood Re is a reinsurance scheme which does not directly insure customers, but instead allows insurance companies to pass the flood risk element of household policies on to the scheme. Flood Re was always intended to be a transitional measure, ending in 2039. It was intended that by then market conditions would allow flood insurance to reflect risk but still be affordable.222

103.There is evidence that Flood Re has successfully improved the affordability of flood insurance, but that raising awareness of this is still a challenge.223 The National Flood Forum noted concern that “the poorest in society are still not able to afford policies”, as well as that some sectors of the population do not access insurance “because of the difficulties of obtaining it if they are at high risk, because of previous experiences of being rejected, because they have other priorities or because of cultural approaches”.224 The Government’s July 2020 policy statement states that it will work with Flood Re and the insurance industry to “explore whether it would be beneficial for insurers to share more information with customers about their flood risk—encouraging everyone to take responsibility to encourage greater uptake”.225

104.Following the flooding in November 2019, the Government said there were “reports of people not having sufficient insurance cover” and announced a review of the issue.226 The review was led by former ABI Chair Amanda Blanc, and included a “deep dive case-study” of the Doncaster area.227 Ms Blanc noted that the review was one of the first opportunities to look at the adequacy of insurance cover in practice since the introduction of Flood Re.228 Upon publication of the report in November 2020, Ms Blanc said she was “concerned to discover that although the majority of Doncaster residents had sensibly protected themselves with insurance, some of these policyholders had been sold cover which specifically excluded flood risk”.229 The report said that “future national surveys into the coverage of insurance” should take into account “the extent to which buildings or contents insurance excluded flood risk”.230

105.It is essential that the Government works with Flood Re and the insurance industry to identify and address continuing obstacles to the uptake of insurance among people at risk from flooding. The Government should set out what further research will be undertaken, building on the Blanc review of insurance in Doncaster, to better understand and address barriers to uptake of household flood insurance cover.

106.Flood Re covers only residential properties. They, and the ABI, have said that “overall, the insurance industry is not aware of a systemic, widespread failure of market provision for flood insurance for small businesses”, and that designing a Flood Re-type scheme for businesses would be extremely complex due to “the sheer variety of businesses, and types of business property”.231 The continued blanket exclusion of businesses was also defended in oral evidence by Defra official David Cooper, who told us that “we need to be careful of wider householders paying for the cover that businesses might need where they are profit-making companies”.232

107.Nonetheless, there remains concern in some quarters about insurance coverage for small and medium sized businesses. The British Insurance Brokers’ Association (BIBA) has launched a commercial insurance scheme which aims to “significantly improve” the ability of SMEs and property owners to find flood insurance, which the Secretary of State highlighted to us.233 However, BIBA’s own evidence to our inquiry nevertheless said that risk-reflective pricing is “less easily applied” to SMEs and micro-SMEs, and there were suggestions from stakeholders that “they may be unaffordable for some small businesses”.234 BIBA expressed concern at the lack of an equivalent to the 23-year Flood Re transition, in order to “smooth” the shift to risk-reflective flood insurance pricing for SMEs.235 The Blanc review of flood insurance cover in Doncaster, while declining to draw general conclusions about insurance for businesses due to the small sample size, noted that “in the light of the way the economy is likely to evolve post [covid-19], with more homes acting as business premises, there is a good case for reviewing the needs of these businesses and any gap in insurance, in greater depth”.236

108.We understand the Government’s argument that businesses are in a different position compared to households in respect of flood insurance cover. However, we are concerned about the position of small and medium-sized enterprises, which do not benefit from any Government-backed initiative, equivalent to Flood Re, that would smooth the transition to risk-reflective pricing. Access to affordable insurance cover is crucial for improving flood resilience, and the Government must ensure that small and medium-sized businesses are not disadvantaged in this regard. The Government should work with industry and stakeholders to establish, as a matter of urgency, additional measures, beyond guidance and signposting, to support small and medium-sized businesses to access affordable flood insurance cover.