Government gambles by excluding climate change from flood insurance deal

Guy Shrubsole

18 December 2013

This week the House of Commons waved through a flood insurance plan with a big problem – it doesn’t factor in climate change.

The Government’s own figures show that climate change is set to dramatically increase the number of households at significant flood risk – up to 970,000 homes during the 2020s, up from around 370,000 now.

Yet when the Government published its proposals for flood insurance (or ‘Flood Re’) three weeks ago, its Impact Assessment stated explicitly that it “assumes that flood risk remains the same over time. It does not… take account of changing flood risk due to deterioration of existing flood defences, climate change or development in flood risk areas.”

As you might imagine, this worried us rather a lot. So we put together a briefing, sent it to the MPs on the Committee that had begun scrutinising the flood insurance proposals, and called up some journalists. As we were doing so, Britain’s East Coast was struck by the worst storm surge in 60 years, leading to thousands of households being evacuated and many homes flooded.

The storm – and the revelations – led to widespread press coverage questioning the folly of the Government’s insurance plans, and asking whether the Environment Secretary, Owen Paterson, has let his oddball, ill-informed ideas about climate change impact on policy decisions.

As the debate escalated we also learned that 3 million homes are now at risk of flash flooding – in addition to the 2 million at risk from floods from rivers and the sea. The Environment Agency’s new flood maps show that flooding is no respecter of wealth or status – even Downing Street is at risk.

Then we learned that Labour was preparing to introduce amendments to Flood Re that would force Ministers to take the advice of the Committee on Climate Change when considering future flood risk. This was hugely welcome – and something Friends of the Earth had suggested in its briefing on the matter.

The day of the crucial debate arrived. Before introducing Labour’s amendments, Shadow Environment Minister Thomas Docherty spoke movingly:

“Climate change is a reality. We saw on our televisions just last week the horrific weather that affected the eastern side of the United Kingdom… I could not help thinking, when we sat here last Thursday and watched the wind beginning to gust, that we were debating a live issue that has to be dealt with.”

But the Liberal Democrat Minister responsible for piloting Flood Re through the House, Dan Rogerson, remained unmoved. He sought to reassure MPs, claiming that “climate change protections [sic] were considered, alongside other risk factors, during the design of the policy… our position is that we took the factors into account in developing the model.” I wonder whether the Minister was actually briefed on the assessments his civil servants carried out.

Labour’s amendments were subsequently voted down, but they have vowed to fight on as the legislation passes to the House of Lords in the new year – as shall we.

Indeed, the insurance industry themselves have long warned that flood risk is only going to grow in future thanks to climate change. A recent blog by the Association of British Insurers (ABI), whilst remaining sanguine that Flood Re is a ‘flexible’ enough policy to adapt to changing flood risk over time, entirely accepts climate change is increasing risk – and studiously avoids discussing the Government’s Impact Assessment.

The ABI also states that “the best way for flood risk to be managed in line with climate change is through targeted investment in flood defences and a zero tolerance approach to inappropriate development.” To which we would add: the best insurance we have against increasingly worse flooding is for the Government to get serious about stopping climate change in the first place.

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