On Wednesday, the Autumn Statement is expected to make significant announcements about future investment in flood and coastal defence. No new money is expected. Instead, two major publications have been promised:
- A six-year capital investment plan: a list of individual flood and coastal schemes in England that are expected to be funded between now and 2021. This will be the first such plan, made possible by an unprecedented six-year funding settlement agreed with HM Treasury last year. Until now the Environment Agency has allocated money to schemes on an annual basis, with only indicative plans for future years.
- New Long-Term Investment Scenarios (‘LTIS2’): an assessment of future flood and coastal risk management funding needs in England for the next fifty years, based on various assumptions and scenarios. This will update the previous set of scenarios in the ‘Long-Term Investment Strategy’ published by the Environment Agency in 2009.
So what can we expect? There should be lots of positive coverage, especially about the communities around England that can expect to benefit from new and improved defences in the six-year plan. Defra has committed to deliver better flood protection to 300,000 households by 2021, more per year than the 165,000 over the current four-year spending period. Commitments have also been made to leverage at least £300 million in external contributions under the ‘Partnership Funding’ policy. The final total could be at least double this. The Environment Agency says it can be 10% more productive with the money being provided by the Treasury. Overall, the next six years in England will see the most ever invested in managing flood risk.
The question is whether spending ‘more than ever’ will be ‘enough’. That’s where the new long-term investment scenarios come in. The first LTIS said that funding would need to increase by £20 million plus inflation each year for the next twenty-five years to keep pace with the combined effects of asset deterioration and climate change. A year after its publication, in order to help reduce the deficit, the incoming government cut flood defence grants to the Environment Agency by £138 million. Even with the extra funding announced since, including efficiencies and the growth in money from other sources, spending this Parliament has been £500 million below the “most favourable” investment scenario presented in the 2009 LTIS.
The new assessment is expected to tell a different story. There are now updated models of tidal, river and surface water flood risk. The Environment Agency has a better handle on where flood defence assets are and what condition they are in. The necessary scale of investment will be sensitive to these data and assumptions about how quickly defence assets degrade – with and without maintenance. Maybe less will be needed now than previously thought?
To be able to say so, the new LTIS will need to answer six questions.
- What is the long-term goal – to reduce flood risk or to maximise value for taxpayers’ money? The Government has never stated what it intends to achieve in managing flood risk. The “most favourable” spending plan in the first LTIS was highlighted because it was the best in value for money terms of those considered. But it only managed to hold steady the number of properties at significant flood risk. It didn’t exhaust the list of worthwhile projects and some parts of the country would remain poorly protected. How will the ‘best’ spending scenario be chosen this time, and what will it achieve?
- Are current spending plans right for the next six years? There is evidence of under-investment in both new and improved defences and the ongoing maintenance of existing defences. In February, the Environment Agency published a list of nearly five hundred projects that won’t be funded until 2019/20 at the earliest. ASC analysis suggests seventy percent of the available capital funding for the next five years has already been committed to projects that are underway. So how many new projects will be possible in the coming years, and will the current backlog remain? Given no new money is expected, the new LTIS needs to explain why current budgets do not need to be reviewed.
- What is the impact of new development on future flood risk? The 2009 LTIS ignored the impact of new development in flood risk areas, assuming that any new development will not add to the number of homes at risk nor increase the costs of flood defence. In reality 20,000 new properties are built on the floodplain each year, including 4,000 a year in areas of significant flood risk. LTIS2 needs to make a more robust assessment of the long-term costs and risks resulting from floodplain development.
- How much will it cost to adapt to climate change? The Environment Agency has made allowances for climate change in its plans and strategies for years, and in 2009 applied the mid-point of a mid-range greenhouse gas emissions scenario in the first LTIS. The ideal spending scenario might differ depending on the extent of climate change factored in. LTIS2 should test the sensitivity of spending needs to different climate assumptions to determine the most sensible, ‘low regret’ approach.
- How much should be spent managing surface water flood risk? The first LTIS ignored surface water flood risk in the main spending scenarios. In the Environment Agency’s most recent medium-term plan, a sixth of the available capital in future years was earmarked for surface water projects. This year, new projects had to demonstrate twice the required level of benefit to secure a share of the government money available. Demand is likely to increase further, as eighty percent of lead local flood authorities have yet to finalise their local flood risk management strategy. Once strategies are agreed, authorities will need the funding to deliver them. Urban areas are looking to green infrastructure and sustainable drainage solutions (SuDS) to relieve the pressure on ageing sewers. Water companies will meet some but by no means all of these costs.
- What role might property-level protection and local resilience measures play? Even if annual investment levels were to double by 2035, the last LTIS projected there would remain around 500,000 properties at significant flood risk. It was assumed these would be left exposed. However, the ASC’s 2012 progress report (p42) found that fitting property-level protection measures would be cost-effective for up to 190,000 properties. Fitting a basic set of measures like flood boards and air brick covers to these would cost £800 million but avoid billions more in flood damages (and help safeguard affordable flood insurance). Will the new LTIS ignore the potential for property-level measures and resilience, as the last one did?
The new LTIS will definitely not answer one key question; what the spending scenarios mean for individual communities. The LTIS is necessarily a broad-brush national assessment, though could include at least a regional picture this time. There will be many communities not listed in the six-year plan, and for whom the LTIS implies a future of increasing and unmanaged flood risk. This will not be immediately apparent.
The LTIS will be a major step forward in understanding the future scale of flood risk in England. It promises to be the most comprehensive assessment of flood risk in this, and perhaps any, country. Whatever the document says the scenarios should be welcomed, as a considerable technical achievement and as a transparent and objective assessment of the long-term climate challenge. But conversations will then need to follow to explore the implications for individual communities.
This blog was written by Daniel Johns, Head of Adaptation at the Committee on Climate Change.