PARLIAMENTARY DEBATES - United Kingdom Parliament

1529 Flood Insurance
26 MARCH 2013
Flood Insurance
1530
affordable insurance and sometimes to get any insurance
at all. Does my hon. Friend agree that, in that case, the
30 June deadline is perhaps not the highest priority?
The highest priority should be getting the right deal for
constituents so that they can go forward into the future.
Sir Robert Smith: Both are important. The right deal
for those not getting a good enough service out of the
statement of principles is extremely important, as is
knowing what it is going to happen after the deadline.
That is important for everyone affected, as they are
going to have to renew their insurance and will have to
find an affordable way of doing that. I commend the
motion as a way of keeping up the pressure and highlighting
our constituents’ perspective that there has to be a
serious solution to this problem.
3.44 pm
Ian Lavery (Wansbeck) (Lab): I congratulate the hon.
Member for Esher and Walton (Mr Raab) on initiating
this timely debate on the Floor of the House. By way of
background, I remind Members that on 5 and 6 September
2008 Morpeth—a market town in my constituency—found
itself at the centre of the most intensive rainfall in living
memory. Some 950 properties in the town, including
dozens of businesses, were directly affected. Surrounding
villages were hit very hard, too, including Hepscott, which
was affected by flash flooding. A number of other
properties were badly flooded. The devastation suffered
by individuals, families, businesses and the community
at large cannot be overstated in any way, shape or form.
It was an experience that will haunt their memories for
many years.
As we debate the issue today, I am delighted that
progress is finally being made in Morpeth. I thank and
congratulate Northumberland county council, which
has allocated £12 million towards the cost of new flood
defences. That money is being delivered with the support
and agreement of the three main political parties. It is
important to recognise the role that the emergency
services have played across the UK, but particularly in
Morpeth in my constituency, and the way that they
operated to help others during those difficult times. The
local community in my constituency, the Morpeth Flood
Action Group and many others pulled together, as has
happened in the constituencies of many other hon.
Members on both sides of the House, in the most
difficult of circumstances. It would be remiss of me not
to mention the Environment Agency and Ian Hodge,
who works at the agency in Newcastle, who has played a
huge role in Morpeth.
The problem has been described as immense, but the
pooling system—an important component of insurance—
will be an integral part of any agreement and, I hope,
positive resolution that is reached. The pooling system
has been proposed under the “Flood Re” model and the
Morpeth model. That system formalises the existing
cross-subsidy. It redistributes the risk to keep affordability
in place for high-risk properties. It represents the only
fair way forward in a changing situation where climate
change is giving rise to an increasing number of extreme
weather events. The ABI model, the “Flood Re” system
and the Morpeth system combine availability with
affordability. The “Flood Mu”, or Noah model, does
not guarantee that because it does not put a cap on
flood premiums.
Damian Collins (Folkestone and Hythe) (Con): Does
the hon. Gentleman agree that it is important that the
insurance industry take into account investment in new
flood defence schemes, including the one that he has
talked about and the new sea wall at Dymchurch in my
constituency? Often insurers base their quotes on generic
information that does not take into account investment
in new defences.
Ian Lavery: That is a powerful comment, with which I
totally agree.
As has been discussed, the ABI has been in discussion
with the Government for several months, perhaps years,
on the ending of the statement of principles in June
2013. The clock is ticking. The deadline is fast approaching.
People want answers. People in Morpeth have been
flooded time and again; hon. Members on both sides of
the House have described the experiences of people in
their constituencies who have suffered greatly time and
again. They cannot get affordable insurance. The excesses
are higher than what the properties are worth, so it is
meaningless.
Time and again, Members on both sides of the
House have mentioned the importance of ensuring that
we have a statement that will ensure something affordable
and accessible is in place when the statement of principles
runs out. We have been told time and again that the
discussions with the ABI are at a critical point, that the
statement is nearly ready and that things are in place.
However, The Times this morning said something
completely different. It suggested that there are huge
difficulties between the ABI and the Government. Perhaps
the Minister, for whom I have a lot of time and who has
been very helpful, can explain from the Dispatch Box
this afternoon where we are with the ABI and what is
likely to happen in the next three months. It is absolutely
imperative that we get something in place for the people
who have been suffering for some time.
I am sure that the Minister will have much more to
say, and it is important that we deal with this issue and
that measures are put in place. I hope that we will not
hear, “We are still in discussions and we cannot really
give any more details, because the matter is confidential
and that wouldn’t be right.” We want an answer today
for everyone who lives in a property on a flood plain.
We do not want to hear, “Something will happen.” Give
us the answers, so we can tell our constituents what the
situation is and they can feel safe.
3.50 pm
Julian Sturdy (York Outer) (Con): I am grateful for
the opportunity to make a short contribution to this
very important debate on flood insurance, which I
congratulate my hon. Friend the Member for Esher and
Walton (Mr Raab) on securing.
As the Member of Parliament for a constituency that
contains two major river courses and surrounds one of
the most historic, flood-hit cities in the country, I
naturally have constituents who express a great deal of
concern about flooding, its impact on the local community
and on the availability and affordability of flood insurance.
Flood insurance is an issue not only for those who have
sadly been flooded, but for those who have not and may
never be but are deemed to be in a flood-risk area.