CLA backs Efra call for the Government to support flood-risk property owners

18 October 2013

The CLA today (Thursday, 5 July) backed the House of Commons' Environment, Food and Rural Affairs (Efra) Select Committee's call for more support for owners of property at risk of flooding.

Responding to the Efra Committee's Report on the Government's Water White Paper, CLA President Harry Cotterell said: "The Government's level of funding needs to be increased to give confidence to the insurance industry to provide cover for properties at risk from flooding. And there should be a revision of the Flood and Coastal Erosion Risk Management funding process so that rural properties are not disadvantaged."

The CLA President said that, as the funding process has only recently been introduced and is essentially a pilot scheme which needs to be reviewed, the Government must guarantee future investment and agree a further period with the insurance industry to be covered by a new statement of principles.

Mr Cotterell said: "The insurance industry does not like subsidising the premiums paid by owners insuring properties in high-risk areas by increasing the premiums of owners in areas at lower risk of flooding. Therefore, only Government support will give confidence to the insurance business to provide cover that is affordable.

"It is also vital the insurance industry properly recognises maintenance or improvement works carried out to flood defences by individuals or communities through reduced policy charges. Government support and endorsement is essential for this to happen."

He also said that without a clear future plan for the renewal of the agreement between the Government and the Association of British Insurers (ABI) property values will be significantly affected.

Mr Cotterell said: "You would not buy a property unless you were sure you could insure it at an affordable price."

However, the CLA President said the Efra Committee recommendation to bring forward the abstraction reform proposals using the price review would disadvantage farmers and land managers if they were not also compensated for any licence being revoked.

He said: "We need a well-constructed framework that ensures a fair allocation of water for farmers and land managers so that they can meet future food production and land management needs.

"It is unfair that farmers will have to operate in a water market which includes industries that are able to recover their costs through the pricing process. A ringfenced allocation of water for agriculture and land management would go some way to addressing the market distortion."