2008
(20/07/2008) Additional investment of over £700 million needed to address flood issues across UK - £800m government commitment inadequate
AXA calls for clear accountability and increased investment to deal specifically with drainage problems that cause flooding, along with a larger financial commitment from central and local government to address infrastructure issues.
AXA Insurance, one of the UK's largest insurers of homes and businesses, commissioned research into the amount required for adequate investment to counter the risk of flooding. Based on this research, AXA estimates that an additional £720 million needs to be spent to improve surface drainage across the UK for the 45 towns and cities affected by last year’s floods.
In his statement to the House on 2nd July 2008, the Secretary of State for the Environment, Hilary Benn, announced that flood defence spending will increase to £800m in 2010-2011 but this amount only referred to coastal and river defences and did not include tackling surface drainage. Additionally, while the Government committed £5 million for the development of Surface Water Management Plans in June, this was for the development of the plans, not for the action required. The AXA research demonstrates that significant investment is required.
David Williams, Managing Director, Claims, AXA Insurance said "More than 75% of our flood claims in 2007 resulted from drainage issues. The cost of last year's floods to the UK insurance industry as a whole was around £3.4 billion, which reflects not only a huge financial burden that needs to be spread across insurance premiums, but also the tremendous suffering to policyholders that flooding causes. Prevention measures and increased investment could substantially reduce insurance claims and disruption to people's lives."
Currently, there is no clear responsibility for surface water drainage and AXA is advocating that local authorities should be made accountable for the infrastructure improvements required to address the issues that result from this. This issue was raised in the recent Pitt Review.
The research commissioned by AXA was undertaken by a leading chartered environmental surveyor and also identified that funding strategies have not been established for surface drainage planning by local authorities, despite the heavy flooding of last year.
The improvement of flood defences, the reduction in use of impermeable paving, a review of the automatic right to connect surface water drains or sewers to the public sewerage system, the increased use of SUDS (sustainable urban drainage systems) and in some areas the construction of holding/attenuation areas in the uplands are all viewed as important areas where future improvements could lead to better flood protection in the future for towns at risk.
David Williams added "It is essential that the issues of who is responsible for the ownership and maintenance of sustainable drainage systems are identified and relevant funding put in place to ensure increased protection for the future."
The ABI (Association of British Insurers) and the Government this week announced agreement that ensures flood insurance remains widely available now and in the long term. AXA continues to play an active role within the ABI on flooding and issues emerging from climate change.
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Notes to editors:
AXA
AXA UK is a part of the AXA Group. AXA Group is a worldwide leader in Financial Protection. AXA's operations are diverse geographically, with major operations in Western Europe, North America and the Asia/Pacific area. For full year 2006, IFRS revenues amounted to €79 billion and IFRS underlying earnings amounted to €4,010 million.
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Wilbourn Associates
Wilbourn Associates is a leading chartered environmental surveyors based in Sheffield, providing advice on the environment, contaminated land, energy performance and the resulting impacts upon all forms of Property, Land and Construction. The practice bridges the chasm between the world of environmental science and the market place by offering real estate solutions to environmental problems.specialising in flooding research. The practice was formed in 1993 and has developed a significant reputation for quality advice in all aspects of environmental real estate consulting.
The research was conducted by Wilbourn Associates and is an estimate based on investment of £16 million by Yorkshire Water in the Hull & Haltemprice catchment which would need to be conducted in all 45 cities and towns impacted by the 2007 flooding.