Environment Agency

In November 2010 Defra consulted on reforms to the way capital Flood Defence Grant-in Aid (FDGiA) is allocated to flood and coastal erosion risk management projects in England. Following that consultation a new arrangement will be delivered in the context of the national flood and coastal erosion risk management strategy for England (the ‘national strategy’), Final agreement of the strategy will be an important step forward; not least as it sets the scene for the new approach to funding.

In recent years the EA has allocated national capital funding to projects in order to achieve a range of outcome targets set by Ministers. Investments that have made the biggest contribution towards the targets, per pound of investment required, have been prioritised. This approach has been successful in delivering Government targets, but overall levels of activity have been constrained by the amount of national funding available. This means that whilst some areas have benefitted from good levels of protection at the general taxpayers’ expense, similar levels of protection have not been affordable for everyone. Local priorities have generally been limited to those schemes funded by local levy, which will continue to be raised and invested by the new Regional Flood and Coastal Committees (RFCCs).

From now a different approach is applicable to how national funding is allocated to capital projects that protect households and achieve other important outcomes. As stated in the national strategy, the reforms aim to:

Better protect more communities and deliver more benefits by:

Encouraging total investment to increase beyond levels affordable to central Government alone.

Enabling more local choice, and encouraging innovative, cost-effective options to come forward in which civil society may play a greater role.

Increasing levels of certainty and transparency over the national funding for individual projects, whilst prioritising action for those most at risk and least able to protect or insure themselves.

The new approach creates the opportunity for as many communities as possible to enjoy the benefits that flood and coastal defences bring. Under the new arrangements, those projects delivering the most in terms of benefits and outcomes still have the prospect of being fully funded by Government. But now, in all other cases, schemes that are worthwhile but might otherwise be deferred have the prospect, over time, of at least some funding from Government.

The amount of national funding available to each scheme will be based on a refined version of the arrangements on which we consulted, reflecting responses to that consultation. Working closely with yours, my officials have also sought to simplify the way in which data need be collected and used to determine payment levels and potential contributions. For the purposes of national funding, Government will continue to prioritise protecting those most at risk and living in the most deprived parts of the country.

Specifically the new arrangements will mean:

Local authority projects to manage surface and ground water flood risk can qualify for national funding alongside projects tackling other sources of flood risk and coastal erosion. Water company responsibilities for sewer flooding and effectual drainage are unchanged and will continue to be funded through the price review process.

The full range of risk management approaches, including solutions at the community and individual property-level, can qualify for national funding.

All schemes will be rewarded for the environmental outcomes they achieve, meaning that opportunities to work with natural processes and achieve multiple objectives should be positively sought out and embraced where possible.

As part of the Coalition Government’s commitment to avoid inappropriate development of areas at risk of flooding or coastal change, new properties built or converted into housing after January 2012 will not influence the allocation of national funding. This reinforces local responsibility for planning decisions in these areas.

There is scope for greater local choice over which projects proceed each year. Expectation of being able to better protect at least 145,000 households by March 2015 is achieved.

Flood and coastal erosion risk management provides many benefits for the wider economy and society and it is important that risk management authorities continue to ensure these impacts are properly valued in accordance with HM Treasury and Defra appraisal policy.

The national strategy still needs to be approved by Parliament before taking final decisions and for these reasons, from now until the end of 2012/13 will be considered a transitional period. This will allow lessons to be learned and refinements to potentially be made once arrangements have been tested and programme data becomes available. But for now, the new arrangements continue until further notice.

The Environment Agency are to work up detailed guidance for risk management authorities and others in taking these arrangements forward. These should draw upon previous experiences in operating the existing voluntary contributions policy, and help address any outstanding risks and technical challenges highlighted. This guidance should include the framework under which cost sharing arrangements will operate, including the relevant accountabilities of the Environment Agency and its delivery partners.

To summarise the above, The EA will now be able to utilise the central flood budget to help facilitate any local scheme that wishes to implement ‘on the property’ flood protection products, namely BSI certified flood guards. This is a massive shift in direction for Government to take and has been implemented to bridge the void which will left by the ABI announcing the withdrawal of the Statement of Principles in 2013, leaving up to 750,000 properties with no insurance cover in place against flood. The consequence of the removal in insurance will follow, this being that any property owner that has a loan secured against the property via mortgage will be in breach of the lenders criteria, which stipulates that suitable buildings insurance should be in place to secure the property accordingly. The consequence of the mortgage becoming void is that the lender could potentially request the mortgaged amount to be paid off by the borrower. In addition, if insurance cannot be secured against a property then this property will become unsalable and rendered worthless (£zero) in bricks and mortar value. Analysing the above and linking the ABI’s action followed by the Government reaction, it is vital that the ABI now look to make a further announcement stating that if any property benefits from having BSI accredited products installed on their property then this property will benefit from insurance being reinstated, hence then making the mortgage valid once again.

Floodguards has also worked on multiple contracts for the Environment Agency over the past 10 years helping to initially survey properties to identify the risk of flooding, and then further implement a scheme to help better protect communities against flooding by installing our BSI approved range of products accordingly.

Environment Agency Offices we have worked with include:

  • Environment Agency - Kettering
  • Environment Agency Thames, Bourne End
  • Environment Agency Thames, Winnersh
  • Environment Agency - Gunthorpe
  • Environment Agency - Bleasby
  • Environment Agency - Uttlesford
  • Environment Agency Anglian, Worthing
  • Environment Agency Anglian, Bradwell
  • Environment Agency Wales – Fishguard
  • Environment Agency Wales – Llantwitt Major
  • Environment Agency Wales – Maesteg
  • Environment Agency Wales – Aberystwyth
  • Environment Agency Wales – Trevaughan
  • Environment Agency Wales - Llanddulas