Levelling-up and Regeneration Bill

Written evidence submitted by Aviva (LRB36)

The Levelling Up and Regeneration Bill

Public Bill Committee Submission

Executive Summary

Aviva welcomes the Levelling Up Bill and its focus on regenerating local communities and improving resilience across the UK. Aviva is the UK’s leading insurer providing life, general and health insurance and we support the Levelling Up agenda in a number of practical ways:

· We are one of the largest private investors in UK infrastructure; We set a 3-year target of £10bn for UK infra investment in 2020, and £6bn in green investment, which we are on target to meet. Our investments help build schools and health centres, develop greener energy and lay the fibre UK communities rely upon.

· We provide high-skilled, well-paid jobs across the regions of the UK with 90% of our 15,000 UK employees based outside London in locations like Perth, Sheffield, Bristol, Norwich, Eastleigh and York.

· We are rooted in the communities we serve; this is why we set up the Aviva Community Fund and we’re proud to have helped build stronger, more resilient communities across the UK.

· We help 1 in every 4 households in the UK to protect what’s important to them, save for retirement and plan for the future. Aviva has signed up to the Flood Re Build Back Better scheme – we provide additional flood resilience measures up to £10K for any of our customers who have a flood claim over £25K.

Aviva launched its Building Future Communities report in July 2021 which contained calls for urgent action to ensure UK homes and businesses are protected from flood and extreme weather events caused by climate change.

We welcome the measures in the Bill to put greater emphasis on environmental outcomes in the planning process and recognise the need to protect areas at high flood risk areas. There is a clear opportunity for the Government to use the Levelling Up and Regeneration Bill to go further and improve the planning system to ensure Net Zero alignment, including by reducing inappropriate development in high flood risk areas and ensuring new homes are resilient to climate risk.

One such approach to achieving this is by using National Development Management Policies ("NDMP"). NDMPs could be used to ensure the right homes are built in the right places, with the right protection against flooding, bio-diversity loss and other extreme effects of climate change. This will help Level-up by improving property resilience and not building the insurance problems of the future.

What the National Development Management Policies should cover is not set out in the Bill. We think they should be used to strengthen planning rules and ensure:

1. Floodplain development is avoided where possible and accompanied by appropriate flood defences, management and resilience, where unavoidable.

2. UK planning policy embeds the principle that all new development should be sustainable, climate resilient and respectful of bio-diversity.

3. Building developers are prevented from completing on new buildings until the correct flood and other resilience standards have been met and certified.  

Submission

Insurers are on the front line of responding to the physical risks of the climate crisis, particularly the increasing risk of flooding. We understand the physical, emotional and financial cost of flooding to our customers and are widely recognised as expert in working with customers to manage and support them.

ABI figures show that in response to the damage caused by Storms Dudley, Eunice and Franklin, that hit much of the UK in February, insurers expect to pay out nearly £500million in dealing with 177,000 claims. This follows pay-outs totalling over £540million following the flooding from Storms Ciara, Dennis and Jorge which hit the UK in February 2020.

Households across the UK are at risk from climate change and current planning rules are inadequate to address today’s risks – let alone the worsening picture we can expect over the coming decades:

· More than 80,000 UK properties have flooded since 2007, and the UK flooding in 2019-20 alone was estimated to have cost the UK economy £78 million [1] .

· 21% of UK homes are at risk of at least one type of flooding: 19% from surface water flooding (which is an increasing threat, as demonstrated from last year’s summer floods in London) and 6% from river or coastal flooding. Concerningly, 4% are at risk from both types [2]

· Yet worryingly, since January 2009, over 70,000 new homes have been built in flood zones, 20,000 of these in areas without flood defences, that will not be covered by Flood Re. [3]

· The Environment Agency has identified that the number of properties built on floodplains is likely to reach 4.6 million over the next 50 years: almost double the figure today [4] .

· New homes built in economically deprived parts of England and Wales (between 2008-2018) are more likely to be exposed to high flood risk than houses in more affluent areas [5] .

· According to the Climate Change Committee, a heatwave event in 2050 could result in 92% of flats and 61% of detached homes exceeding overheating thresholds in London alone [6] .

· And the British Geological Survey predict that the number of properties in the UK at high risk of clay-related subsidence will triple between 2030 and 2070 – with London worst hit [7] .

Current building and planning regulation is failing to protect UK properties against current and future climate impacts. This leaves residents to bear the burden, and the cost, of extreme weather.

For example; Local Plans used to assess planning applications generally do not include policies to address overheating risk. In existing buildings, there are currently no incentives to retrofit overheating measures so when temperatures soar, people in older properties are left unprotected.

Even where regulations exist, they are not sufficiently implemented. Planning policies permit development in areas at risk of flooding providing household resistance or resilience measures are incorporated. But regulatory loopholes allow developers to build and sell properties in flood risk areas simply if they leave space for flood defence measures to be installed in the future. In England, there is still no process for holding developers to account when new properties flood.

New and existing building standards are not aligned with the government’s legally binding net zero by 2050 target. For example, just 1% of new homes built in 2018 were Energy Performance Certificate band A [8] . Building homes in a way that increases emissions will compound these climate risks, leaving the UK in an even worse state.

We are in the midst of a cost-of-living crisis. More than three quarters of adults in Great Britain are worried about the rising cost of living, with half saying they worry every day [9] . People who cannot afford the essentials should not be forced to shoulder the costs of an extreme weather event to their home. We need properties that are resilient from the outset, rather than cutting costs at the design stage and leaving homeowners to pay up once a crisis event hits.

There is a clear case for Government to address this by strengthening planning rules in the Levelling Up and Regeneration Bill:

· It will save Government and homeowners money over the long-term; by ensuring that developers are responsible for consequential effects of development in flood defence, management and resilience measures and making them accountable for them - Government would need to spend less themselves.

· It will help level-up by improving property resilience and not building the insurance problems of the future; Currently new homes built in economically deprived parts of the UK are more likely to become exposed to high flood risk over their lifetime than houses built in more affluent areas [10] .

Background on National Development Management Policies ("NDMP")

NDMPs are introduced by the Bill (Part 3 Chapter 2 Clause 84) and will sit alongside local development plans ("LDP") and carry the same weight in decision making. They will cover strategic national planning issues, (rather than specific local issues), and are therefore ideally suited to determine how properties should be built resilient to flooding and other climate related issues.

The Bill gives the power for the Secretary of State to set NDMPs following a public consultation. What the National Development Management Policies should cover is not set out in the Bill. We think they should be used to strengthen planning rules and ensure:

1. Floodplain development is avoided where possible and accompanied by appropriate flood defences, management and resilience, where unavoidable.

2. UK planning policy embeds the principle that all new development should be sustainable, climate resilient and respectful of bio-diversity.

3. Building developers are prevented from completing on new buildings until the correct flood and other resilience standards have been met and certified.

The government has committed to publishing a roadmap by the end of 2022 to further accelerate uptake of property flood resilient measures. The roadmap could use NDMPs to achieve acceleration and ensure new build and re-use delivers the highest standards and good homes in a resilient and sustainable environment.

· What low-cost resilience measures could be included in NDMPs? NDMPs could require, for example, all new properties be built with non-return values on waste plumbing and using waterproof plaster to protect against any form of flood.

· How could NDMPs be used to hold developers to account? NDMPS could set Pre-Occupation conditions which must be discharged before the property is occupied and the developer can complete and receive final payment.

In addition to these points on NDMPs we are supportive of the amendments to the originally drafted Bill made with the intent to strengthen rules on flood prevention and mitigation (in particular to clause 88, NC2, NC3, NC4).

Climate change and biodiversity

As recent CPRE research showed, most local plans are not setting strategic, measurable targets for delivering net-zero carbon, and homes and business premises are still being built that are car-dependent and will require costly retrofitting for net zero [11] . We would like to see the bill require national and local planning to be subject to a ‘ net zero test ’ to address this with the ultimate goal to align planning with our legally binding climate targets and net zero pathway.   Crucially, any planning reform must also tackle the current inconsistencies with how environmental impact is considered within local planning applications, enabling us to unlock largescale green investment.

Whilst the principle of non-regression from current levels of environmental protection is welcome (in Part 5 of the Bill) there should be explicit reassurance that the replacement of our system of environmental assessment (Strategic Environmental Assessment and Environmental Impact Assessment) with a new Environmental Outcomes Report system does not weaken protections for biodiversity. Furthermore, we would like to see a ringfenced element of the proposed Infrastructure Levy to contribute towards biodiversity conservation measures and levelling-up people’s access to nature-rich greenspace.

Clarity is needed for the Environmental Outcomes Report approach

The framework proposed for an Environmental Outcomes Report (EOR) regime will require the Secretary of State to set environmental conditions, designed to achieve specified environmental outcomes, that projects have to meet in order to gain consent. The Environment Act targets, including halting the decline in species abundance by 2030, as well as Local Nature Recovery Strategies and the strengthened biodiversity duty, provide a range of effective environmental outcomes for conditions to work towards. We strongly recommend that reference is made to these existing measures.

Beyond this basic structure, much of the detail of how EOR will work may not be known in full until the draft regulations are published. We note that the definition of ‘environmental protection’ set out within the Bill (Clause 116(2)) includes issues such as cultural heritage. Greater weighting will need to be afforded to nature and biodiversity relative to such broader considerations. The Bill also indicates that greater weight may be given to the Environmental Outcome Report process in ‘certain’ circumstances (Clause 117). No more details are provided in the Bill’s explanatory notes. The Government should clarify what is intended now to enable informed parliamentary debates.

Recommendations from the Landscapes Review

The Government has consulted on how to improve National Parks and AONBs based on the recommendations of the Landscapes Review [12] , an independent, expert report led by Julian Glover. It has made clear that its two priorities are to boost biodiversity in, and improve public access to, these landscapes. These changes should be incorporated into legislation to ensure we have nature-rich National Parks and AONBs for current and future generations, and to help achieve targets in the Environment Act. This would make a significant contribution to levelling-up access to nature and the wide range of benefits nature provides society across the country.

July 2022