Policy paper

Government response to the National Infrastructure Commission’s study: Reducing the risk of surface water flooding

Published 13 March 2024

This was published under the 2022 to 2024 Sunak Conservative government

Introduction 

Flood and storms, such as Babet and Henk have devastating consequences. The government acknowledges the impacts this can have on households and businesses, and sympathises with those affected. During these storms over 242,000 properties were protected by existing flood defences. 

Unlike flooding from rivers and the sea, surface water flooding cannot be managed by traditional concrete flood defences. Surface water flood risk is often localised, complex, happens quickly and is difficult to predict. This risk will also likely increase, as climate change leads to more extreme rainfall, and the population grows. 

Government, delivery partners and others need to take a collective and strategic approach to surface water flood management, including: 

• understanding the risk through mapping, modelling and better forecasting, and where it is greatest to target cost-beneficial mitigation and resilience actions
• partnership working and coordinated action with clear roles and responsibilities 
• ensuring water is able to drain effectively away from homes and gardens, roads, fields, businesses and public spaces by making space for water through urban design, ensuring drainage networks are robust and managing water where it falls for example with sustainable drainage systems and water butts

The government is committed to tackling all forms of flooding, taking action in the short, medium and long-term to ensure that we adapt to the changing level of risk. This approach ensures that we meet our goal to create a nation that is more resilient. 

To underpin this, we have invested more than ever before – doubling the flood and coastal erosion risk management investment programme to £5.2 billion between 2021 and 2027. By the end of September 2023, this has better protected 67,000 properties, on top of the 314,000 better protected in the 2015 to 2021 investment programme. In 2020 we updated the funding rules to enable more surface water schemes to be brought forward. We have created a new Frequently Flooded Allowance to provide ringfenced funding to support communities across England that have experienced repeated flooding.

The government’s Surface water management action plan set out the actions the government, Environment Agency and others have and will continue to take to mitigate this risk.

Of the 22 actions, and 26 accepted recommendations from the Jenkins Review, 70% have already been completed and all will be concluded and or embedded by summer 2024.

Understanding the risk 

The government is taking action to improve the understanding of surface water flood risk, now and in the future:

• The Environment Agency has developed surface water plausible extreme flooding scenarios to help responsible bodies understand the potential impacts and confirmed that the risk of flooding from surface water maps are a fair representation of these scenarios. 
• We are investing £3.5 million to improve lead local flood authorities’ surface water flood risk mapping. This will provide 4.6 million people with a better awareness of the risk that they face and will enable them to take action within their means. It will also enable more targeted mitigation and resilience actions to be delivered. 
• By the end of 2024 the Environment Agency will have published the new National Flood Risk Assessment; helping places better plan and adapt to future risks, significantly improving our understanding of current and future surface water flood risk. This will include much of the new lead local flood authority mapping that is currently being developed, and more will be added over time.
• For the first time, climate change scenarios reflecting global temperature increases will be included in the outputs from the new National Flood Risk Assessment. This will inform: 
  • The next Long Term Investment Scenarios which will be published by the Environment Agency by the end of 2025 and will look ahead 50 to 100 years to 2125, providing an economic assessment of what future flood and coastal erosion risk management could look like and helping to identify the policy choices and required investment. 
  • Developers and spatial planners, so they can take account of climate change up to 100 years ahead. 
  • The public, giving them an insight into future flood risk.
• By summer 2024 the Environment Agency will have added surface water assets to its Data Requirement Library, setting out best practice on local asset maintenance and management, including local flood risk asset registers. This will enable lead local flood authorities to gather and share information in a consistent way. In conjunction with the new National Flood Risk Assessment, the asset register work will pave the way to design a methodology to measure national reduction in flood risk.

Partnership working 

Whilst local authorities are responsible for managing surface water flood risk, working in partnership is crucial to mitigate flood risks, especially for surface water where there is a wide range of parties involved. From large public and private bodies to individuals. The government is working to ensure there is more partnership working and that it delivers. 

• We have launched an innovation resilience programme, led by the Environment Agency, which is exploring innovative ways to tackle flood risk in 25 local authority areas. Over half of these are looking at innovative ways to mitigate surface water flooding, and all will share their outcomes to inform future climate resilience and adaptation choices. 
• By 2026, we will have reformed local flood risk management planning to deliver strategic and comprehensive plans, which support long-term local action and investment. They will take an adaptive approach which accounts for climate change, identify opportunities to achieve multiple benefits, demonstrate clear accountability and transparency. 
• By spring 2024, we will conclude our review into the statutory powers and responsibilities around managing and maintaining flood assets, including those for surface water management. This will be used to inform future policy and delivery actions. 
• By summer 2024 the government will produce national guidance on Section 19 investigations, which are carried out by lead local flood authorities after a flood, improving good practice and enabling trend analysis. This will further enable risk management authorities to share knowledge, experience and enable better risk mitigation measures.

Robust drainage 

Effective and robust drainage, both public sewers and private drainage assets, is essential to enable water to effectively drain away helping to mitigate surface water flooding. The government is working to ensure that the public sewer network plays its part. 

• In 2022 we published our Storm overflows discharge reduction plan, investing £60 billion in water company drainage by 2050. 
• We have worked with water companies and regulators to publish non-statutory Drainage and Wastewater Management Plans. These set out how water companies will take a strategic and collaborative approach to improving their systems, including consideration of current and future pressures on drainage networks over the next 25 years. 

All this work and action is already having a positive impact on managing surface water, and wider flood risks. It is boosting resilience and better protecting properties, now and in the future, and is supporting lead local flood authorities delivering their flood risk management duties.

Reducing volumes of water entering the drainage system 

Modelling that the National Infrastructure Commission undertook for the study suggests that the number of properties in areas at high risk of surface water flooding is set to increase by 2055 unless action is taken.

This includes an increase of around 20,000 to 135,000 properties due to the impacts of climate change, 35,000 to 95,000 properties due to new development and possibly a further 50,000 to 65,000 properties due to unplanned increases in impermeable surfaces, putting increased pressure on existing drainage systems. The modelling recognises there may be overlaps between these figures. The latter two form part of ‘urbanisation’ and put more pressure on drainage systems.

Recommendation 1: by the end of 2023, government should implement Schedule 3 of the Flood and Water Management Act 2010 and update its technical standards for sustainable drainage systems.

The government partially accepts this recommendation. 

Following the review into making sustainable drainage systems mandatory in new developments, published on 10 January 2023, government has committed in its integrated plan for delivering clean and plentiful water to requiring standardised sustainable drainage systems in new developments in 2024, subject to final decisions on scope, threshold and process. We expect to consult on these matters by spring 2024 and aim to have finalised the implementation pathway by the end of 2024. 

The upcoming consultation will seek views on revised national technical standards covering the design, construction, operation and maintenance of sustainable drainage systems.

Recommendation 2: government should undertake a comprehensive review of the effectiveness of all available options to manage unplanned increases in impermeable (or hard) surfaces, and their costs and benefits. By the end of 2024, government should decide whether policy changes are required to reduce the impacts on surface water flooding or adjust investment levels for flood risk reduction accordingly.

The government accepts this recommendation. 

We agree the impact of increases in impermeable surfaces on surface water management needs further investigation, including options to mitigate where these occur. Government will scope and establish a review into the impacts and opportunities to manage these in public and private spaces including for surface water management, mitigating flood risk and water quality, with a view to concluding the review by the end of 2024. Government will then review the findings and make any policy changes it considers necessary, feeding into the future cycle of local flood plans and investment. 

Policy commitments already taken, and underway, will both influence and be influenced by the review. These will help ensure that the review is targeted and streamlined, benefiting flood risk management, water and planning objectives. This includes:

a) The government’s recent Integrated plan for delivering clean and plentiful water which includes a commitment to require standardised sustainable drainage systems in new developments in 2024. It recognises that many of our towns and cities have been paved over with hard, impermeable surfaces preventing rainwater from soaking into the ground exacerbating surface water flooding. The plan commits to designing towns and cities for water sustainability and reducing flood risk, with actions targeted at mitigating excess run off. These include building regulations, local design decisions and water reuse.

b) Continuing work with water companies and regulators to take forward, improve and make statutory, Drainage and Wastewater Management Plans. 

c) As part of the government’s 25 Year Environment Plan, Natural England launched in January 2023 the Green Infrastructure Framework: Principles and Standards for England. This will help planners and developers increase the amount of green cover in urban residential areas particularly where provision is poorest.

Identifying the areas at highest risk of flooding 

The study sets out the current national process to identify areas where there is a significant risk of surface water flooding known as ‘flood risk areas’. One of the data sources used to do this is the Environment Agency’s National Flood Risk Assessment which will be updated by the end of 2024.

The National Infrastructure Commission identified that under the previous Flood Risk Regulations 2009, flood risk areas were reviewed every six years, with the next review due in 2023, and suggested that government consider delaying this so the new National Flood Risk Assessment can be used, and revising the process so it is more consistent. These regulations have subsequently been revoked.

The Environment Agency produces a nationwide map of surface water flooding risk, the ‘risk of flooding from surface water map’ which the National Infrastructure Commission suggests is broadly accurate at a high level, but more granular local data would improve the reliability of risk mapping at the street or property level, giving government and the public a better understanding of risk.

This means local mapping should be interoperable with the Environment Agency national surface water maps and the National Infrastructure Commission suggests government should consider commencing provisions in the Flood and Water Management Act 2010 to provide powers to sanction authorities that do not share data.

Recommendation 3: government should: 

• require the Environment Agency to use the results of the second National Flood Risk Assessment in 2024 to identify new flood risk areas 
• from 2025, require upper tier local authorities, water and sewerage companies, and other relevant authorities in the new flood risk areas to, where necessary, develop detailed local risk maps that can be integrated into the Environment Agency’s national map, and models that can be used to plan future management of surface water flooding

The government accepts this recommendation. 

The government agrees that the new National Flood Risk Assessment should inform future flood risk planning and support improved and updated local flood risk mapping and modelling. Accessible and up to date modelling and mapping is key to enabling effective planning and supports the identification of areas at risk of flooding. 

The Environment Agency’s updated National Flood Risk Assessment, due by the end of 2024, will provide an up-to-date picture of current and future flood risk from rivers, the sea and surface water, enabling the identification of areas at risk from flooding across England.

The new assessment will include local surface water models where these have been provided by lead local flood authorities and are considered to add value to the new national surface water mapping. These models can include sewer capacity information where water companies have agreed that it can be used for the purpose of mapping.

Requirements to identify flood risk areas under the EU derived Flood Risk Regulations 2009 no longer apply as a result of the Retained EU Law (Reform and Revocation) Act 2023. This has removed duplication with the Flood and Water Management Act 2010, reducing burdens on the Environment Agency and lead local flood authorities. The Environment Agency and lead local flood authorities continue to be required to assess flood risk, as set out in sections 7 and 9 of the Flood and Water Management Act 2010 for the purpose of local and national flood risk management strategies.

The government will include requirements for the assessment of current and future local flood risk as part of its reform of local flood risk management planning by 2026. Future plans will be clearer, more ambitious, and will provide a framework for action and investment in local areas. Understanding local flood risk, will be informed by the new National Flood Risk Assessment. The reforms will also consider whether identified high flood risk areas should undertake more detailed local analysis (in particular where this applies to surface water flood risk). We will consult on these reforms in 2024 and have committed to make changes to local flood risk management planning by 2026. 

Ahead of full implementation of the new flood planning landscape, lead local flood authorities and other risk management authorities should use the outputs from the new National Flood Risk Assessment once it has been introduced, and add to it where necessary to ensure current plans to manage surface water flood risk reflect the latest available data. 

All flood risk assessments, mapping and modelling need the maximum interoperability between the different risk management authorities. This is important both at a local level to target action in high risk surface water areas and at a national level to gather a national picture of the risk.

Under the Flood and Water Management Act 2010 all risk management authorities have a duty to co-operate in the exercise of their flood and coastal erosion risk management functions. The Act also grants powers to the Environment Agency and lead local flood authorities to request information, in relation to their flood duties, from other persons, which must be provided in the form or manner and within the period specified.

In 2011 Defra and the Environment Agency published statutory guidance covering these parts of the Act, including the typical activities needed to deliver their functions such as mapping historic and predicted flood risk. Alongside the power to request information, the Act includes a civil sanctions enforcement power.

The government will take action to enact this power should we receive substantial evidence of significant resistance to data sharing. Commencing these powers is unlikely to address data protection concerns related to the challenges of open data, so other solutions are being explored to ensure compliance with data protection laws are not compromised. 

The Environment Agency’s national Flood and Coastal Erosion Risk Management Strategy recognises the importance of having the evidence we need to inform our future understanding of flood and coastal erosion risk and future investment needs.

The Environment Agency is working in partnership with others on actions in the Flood and Coastal Erosion Risk Management Roadmap which will enable better sharing of data between risk management authorities. These will lead to more effective flood and coastal erosion risk management through better recording of natural flood management projects, sharing of data on property flood resilience and improved flood risk mapping. 

Through the surface water asset register project the Environment Agency is also taking forward learning from the data sharing successes of the National Underground Asset Register project led by the Department for Science, Innovation and Technology and the Geospatial Commission.

The National Underground Asset Register project is building a digital map of underground pipes and cables which includes data from all of the major energy and water companies in these areas, as well as numerous smaller and public sector organisations. The emerging service is improving the efficiency and safety of underground works by providing secure access to privately and publicly owned location data about the pipes and cables beneath our feet. 

Where data sharing issues remain, the government and the Environment Agency will continue to work with other risk management authorities to tackle barriers. By 2025 the Environment Agency will provide technical guidance on effective data sharing, including how sewer capacity information can be incorporated into local surface water modelling, and the requirements to ensure that local surface water models are interoperable with the new National Flood Risk Assessment.

New targets to reduce properties at risk

The study reports that whilst the government sets goals for an overall flood risk reduction and property protection by 2027 there is no quantifiable long-term target for surface water flooding, nor a framework to agree one locally. The National Infrastructure Commission believe that this limits progress, as risk management authorities do not have a shared commitment to deliver, and national policy and strategy does not provide sufficient detail to drive local action and encourage coordination. They also consider that a lack of targets prevents effective monitoring. 

The National Infrastructure Commission advocates a new national target be set for flood risk reduction to drive and monitor progress, measured by the number of properties remaining at different levels of risk. 

To drive and monitor progress at the local level, the National Infrastructure Commission further proposes that local risk management authorities in the new flood risk areas should identify quantifiable local targets for reductions in surface water flooding and the flood damage avoided. They suggest that the Environment Agency should consider if local targets will deliver progress against the national target and to hold local authorities accountable, and for Ofwat to hold water companies accountable. 

Modelling commissioned by the National Infrastructure Commission suggests that an investment of £12 billon over 30 years in cost-effective drainage measures (above and below ground) could reduce the number of properties that will be at high risk and medium risk of surface water flooding by 2055 respectively by 60% and 30%. 

Subsequent to the publication of the surface water study the National Infrastructure Commission published its second National Infrastructure Assessment in October 2023.

The Assessment recommends that government also sets a long-term measurable target to reduce the number of properties likely to be flooded by rivers and the sea. The National Infrastructure Commission make proposals on how a river and the sea target could be reached, including by adopting different standards of protection in local areas and by investing in line with their recommended investment profile in the second Assessment.

Recommendation 4: by early 2025, government should set a long term target for a percentage reduction in the number of properties at high and medium risk of surface water flooding.

The government partially accepts this recommendation. 

During 2025, the government will work with the Environment Agency, National Infrastructure Commission, Climate Change Committee and other experts to assess the most appropriate measure for flood risk reduction from rivers, the sea and surface water – and the merits of setting a long-term target. Any metrics used will need to reflect wider resilience options and not just the provision and maintenance of infrastructure. 

To inform this approach a number of important technical issues need to be considered as part of this work which will include: 

• the flood risk bands or thresholds used to determine properties at risk
• the confidence level in understanding the impact and likelihood of surface water flooding
• the modelling requirements needed to capture the positive impacts and costs of natural flood management, sustainable drainage systems and property flood resilience measures - this will include impacts on all relevant stakeholders 
• the suitability of flood risk metrics for setting a long-term target

This work will be informed by the new National Flood Risk Assessment (due end of 2024) which will identify priority areas of flood risk and enable improved monitoring of progress. We will also review the modelling that informs the level of flood risk reduction from future cost-beneficial investment through the Environment Agency’s next Long Term Investment Scenarios (due 2025). This economic assessment will take account of the latest updates in risk, climate change, population growth, previous investment and current asset conditions.

We will consider all of these issues as we work with the Environment Agency, National Infrastructure Commission and other experts to examine the most appropriate metric and options for any future long-term target for surface water, rivers and sea flood risk. We will address the wider detailed considerations set out by the National Infrastructure Commission in this recommendation and seek to conclude this work by the end of 2025 to inform future government investment choices. 

Before then we are delivering on the government’s Flood and coastal erosion risk management: policy statement to develop a national set of indicators to monitor trends over time in tackling flood and coastal erosion risk in England.

Following the Environment Agency led research project into measuring resilience to flooding and coastal change and extensive engagement with 100 flood and coastal erosion risk management stakeholders, the government has selected a small set of national indicators which cover all sources of flood risk and will provide an improved understanding of progress to create a more resilient nation. The indicators measure progress against a wider range of flood resilience actions.

These are: properties better protected from flooding through defences, asset condition, planning applications granted against flood risk advice and availability and take up of flood warnings. The Environment Agency has already begun to integrate the national indicators within its annual flood and coastal erosion risk management report 2022 to 2023 and will continue to report against the indicators annually.

Recommendation 5: the government should require risk management authorities in the new flood risk areas to agree appropriate local targets by mid 2025.

The government partially accepts this recommendation. 

Lead local flood authorities are responsible for identifying and managing local flood risk, which includes surface water. They are required to identify and agree local objectives for managing these local flood risks and to set them out in their statutory Local Flood Risk Management Strategy. These objectives reflect local, including partner, knowledge and understanding of the risks and are appropriate to the levels of risk they face. 

As part of our reforms to local flood risk management planning, and informed by the outcome of our commitment to explore the appropriate measure for flood risk reduction and options to consider a national long-term target, we will consider future requirements needed to enhance and expand on these local objectives especially in high flood risk areas. 

We will consult on reforms to local flood risk management planning in 2024 which will include considering how local areas can best set measurable outcomes for flood risk in their areas and catchments, for all sources of flood risk to drive local action and progress. Future plans will support an integrated approach which promotes joined up action across the whole of an area or catchment, including upstream and downstream, and taking into account the impacts to surrounding areas. 

The government will continue to work with key stakeholders and its advisory bodies, such as the National Infrastructure Commission, and Climate Change Committee to explore the most appropriate ways of linking any national flood risk measure or target to local measurable outcomes which best fit local circumstances within catchments.

Water and sewerage companies’ role 

The study highlights the key role water company assets have in reducing the risk of surface water flooding in the future, through both improvements to below ground drainage systems and delivering further above ground interventions that can relieve pressure on pipes and sewers.

The National Infrastructure Commission analysis identifies a need for significant enhancements to the capacity of below and above ground drainage infrastructure to reduce the risk of surface water flooding over the next 30 years. A large part of this investment will need to come from water and sewerage companies to ensure their infrastructure keeps pace with external pressures.

Water companies have a duty to maintain their sewers to ensure that their area is effectually drained. The National Infrastructure Commission suggests they are not currently encouraged enough to address surface water flooding, have tended to focus on sewer flooding and surface water connections to public sewers and that this is reflected in the first cycle of Drainage and Wastewater Management Plans.

To ensure the lowest cost options are considered, the National Infrastructure Commission recommends a solutions hierarchy prioritising maintenance and optimisation of the existing sewer network followed by above ground solutions and that below ground interventions be considered last.

Recommendation 6: government should clarify in its strategic priorities for Ofwat that it should enable water and sewerage companies to invest in solutions to manage surface water flooding including sustainable drainage.

The government accepts this recommendation. 

The Environment Agency and Ofwat have a shared ambition to ensure that water company infrastructure is fit for the country’s long-term needs, as a vital part of ensuring resilient places and communities. In 2022 they published a joint approach for how water companies should consider flood and coastal resilience in the context of their statutory roles and duties.

This joint approach reflects strategic commitments in Ofwat’s strategy Time to Act, Together, and in the Environment Agency’s National Flood and Coastal Erosion Risk Management Strategy for England. 

The government sets its expectations for Ofwat via its Strategic Policy Statement. These priorities already include a resilient water sector that meets long-term water resource needs, delivers resilient drainage and wastewater services and greater resilience to flooding. This already covers surface water flooding and sustainable drainage, and we will consider how best to make more explicit the need to consider sustainable drainage solutions upstream from mains infrastructure when we next review the Strategic Policy Statement (due 2027). 

In the course of carrying out their functions water companies are already investing in flood mitigation, including sustainable drainage systems and exploring the benefits of smart water butts. The government has committed to considering what further guidance and reporting is necessary to target action in high risk areas, including through the development of Drainage and Wastewater Management Plans. The focus on the use of nature-based solutions can be seen in water company draft business plans for the 2025 to 2030 planning cycle.

United Utilities for example have included an £8.9 million programme to make greater use of nature-based solutions including wetlands, peatland restoration and sustainable drainage systems to increase the resilience of the water environment to pressures such as climate change.

Regulators and water companies will continue to work together on Drainage and Wastewater Management Plans to build on the first non-statutory cycle. The first round of these plans included actions which could remove the surface water runoff from 40,000 hectares of land from entering the combined sewer network if the required investment (£32 billion) is secured over the next 25 years.

Single joint plans for shared risk 

To ensure targeted, coordinated and costed action to manage surface water the Study recommends that local risk management authorities develop and deliver mandatory, long-term, costed, joint plans for the newly identified flood risk areas. In large urban areas with complex drainage, it may be appropriate to have a single joint plan that covers multiple local authorities. 

They propose new plans should be based on local knowledge and accountability, replacing local flood risk management strategies, and informing Drainage and Wastewater Management Plans. They should set out a common vision, include quantifiable local targets, assign clear roles and responsibilities, contain a costed programme for the next five years plus indicative for the next 20 years. They should follow the ‘solutions hierarchy’, consider property flood resilience and designing for exceedance. 

The Environment Agency should review and assure the joint plans, with input from Ofwat and support from Regional Flood and Coastal Committees.

Recommendation 7: government should require: 

• upper tier local authorities, water and sewerage companies, and, where relevant, internal drainage boards in the new flood risk areas to produce and deliver costed, joint investment plans for managing surface water that achieve the agreed local objectives and follow the ‘solutions hierarchy’ 
• the Environment Agency to review and assure the final plans with input from Ofwat and support from Regional Flood and Coastal Committees, and publish data on progress against local and national targets 
• joint plans to be completed by 2026 and revised every five years following the review of flood risk areas the year before, and to inform the following Ofwat Price Review

The government partially accepts this recommendation. 

We agree that the relevant risk management authorities should work together to manage surface water flood risk, delivering joint opportunities including investment. As explored in our integrated plan for delivering clean and plentiful water, the current water and floods policy and legal framework has been developed incrementally over time, resulting in over 15 national plans and strategic documents. Whilst each plan has its own purpose, we want to make the whole framework more outcome-focussed and fully integrated with other environmental plans and government delivery plans. This includes our commitment to better align flood and water planning. 

We have committed to reform local flood risk management plans, by 2026, so that every area of England will have a more strategic and comprehensive plan that drives long-term local action and investment. 

The objectives for our reforms, published in July 2021, include the need for plans to demonstrate clear accountability and transparency, deliver collaboration between risk management authorities and other relevant bodies and identify opportunities to achieve multiple benefits. This means that plans should identify action owners to ensure local ownership and leadership and include appropriate oversight, scrutiny, and transparency arrangements to support long-term action and investment. 

Likewise, Drainage and Wastewater Management Plans will provide comprehensive, evidence based and transparent plans looking 25 years ahead, considering risks and issues such as climate change, the importance of collaboration and value for money. 

We will improve effective joint working and delivery through our guidance and support to develop water companies’ statutory Drainage and Wastewater Management Plans and the reforms we are delivering to statutory local flood plans. As part of the work to make Drainage and Wastewater Management Plans statutory, we will also consider whether risk management authorities should be made statutory consultees for water companies to engage with in the Drainage and Wastewater Management Plan planning process. 

We will develop shared principles for the relevant bodies to apply during 2024 to achieve better alignment between flood and water planning and importantly delivery, especially in relation to surface water management and flood risk. We will consult on what these should include, such as:

• Engagement standards with stakeholders and local communities. Key to ensuring that there is a common vision, clear actions, owners, and accountability
• Collaboration and partnerships. Identifying and ensuring collaborative working, bringing together the right people to deliver action in the most cost-effective way
• Surface water risk areas. Taking account of the latest evidence to identify where the risk is greatest and the most benefit can be delivered with individual or joint action and investment
• Mitigation management. Consideration of the full portfolio of solutions to mitigate surface water flooding, including sustainable drainage and green/blue infrastructure, designing for exceedance and property flood resilience. This will include delivering the most cost-beneficial actions and taking account of the National Infrastructure Commission’s ‘solutions hierarchy’
• Government support. More support and encouragement from regulators to disseminate good practice examples to help visualise how to deliver successful joint solutions

To embed the final agreed principles, we plan to include them in any statutory guidance and reporting arrangements for our reforms for local flood plans and in new guidance for Drainage and Wastewater Management Plans. We will also ensure that the regulators (Environment Agency and Ofwat) have appropriate roles in respect of assessing quality and content of these plans. The principles will apply to risk management authorities and other relevant bodies, clearly setting out the government’s expectations. 

Our consultation on reforms to local flood risk management planning in 2024 will include proposed changes to improve transparency, accountability, and delivery of actions. This will include considering whether further measures are needed to ensure effective partnership working between relevant organisations. The consultation will consider options to align objectives, timing, and investment cycles as far as possible between flood and water planning.

Devolved local funding for local flood risks 

The Study looked at current investment for new drainage interventions and its analysis identified that around 60% was provided by water companies, paid via water bills, and determined by Ofwat. The National Infrastructure Commission was unable to include current funding on drainage maintenance because this delivers multiple benefits. The remaining 40% was a mix of public funding from Flood and Coastal Erosion Risk Management Grant in Aid, local authorities, National Highways, and other central government departments. 

Modelling by the National Infrastructure Commission indicated that delivering cost beneficial investments would require a total combined public and private investment of around £12 billion between 2025 and 2055 (within a range of £10.5 to 14.5 billion), about £3.6 billion above current indicative baseline expenditure. 

The study notes that local authorities in making long-term plans for reducing flood risk in their areas would benefit from greater certainty on funding as they can find the bidding for Grant in Aid resource intensive, time consuming and uncertain, particularly for smaller schemes. To support long-term planning, the National Infrastructure Commission recommends government should devolve funding to upper tier local authorities in or containing new flood risk areas, for the purposes of managing surface water flooding along with other local flood risks. They proposed devolved budgets should initially be set for the 5 years from 2026 to 2031.

Recommendation 8: by the end of 2025, government should devolve public funding to upper tier local authorities in or containing new flood risk areas, based on the Environment Agency’s assessment of the levels of risk in each new flood risk area. The funding allocation should be reviewed every five years, in line with single joint plan cycles.

The government partially accepts this recommendation. 

We agree that there is scope to improve how lead local flood authorities access capital funding for flood protection measures and government expects that local authorities should plan for and manage flood risk in their areas. 

We also recognise that there is some evidence, for example the recent National Audit Office, Resilience to flooding report and the Chartered Institution of Water and Environment Management, Surface water management review that flood risk management skills and capability is a limiting factor in some local authorities to effectively deliver flood schemes. In these cases, simply devolving funding is unlikely to achieve the outcome intended. 

We also do not agree that altering funding policy by devolving capital funding direct to some local authorities mid-way through the 2021 to 2027 capital investment programme will help deliver surface water schemes. Instead, it would create greater complexity with different funding programmes for different areas. 

The majority of local government funding is not ringfenced, recognising that local authorities are best placed to decide how to meet the major service pressures in their local areas, including on flood risk management. The Local Government Finance Settlement for 2024 to 2025 will make available over £64.7 billion, an increase in Core Spending Power of up to £4.5 billion on 2023 and 2024. The government also announced an additional £3 million in grant funding for 2024 to 2025 to support local authorities severely impacted by the increase in levies from internal drainage boards. 

To support local authorities to deliver surface water schemes, the Environment Agency are working to enable them to better access funding for relevant projects. This includes streamlining the processes for submitting and approving a project – in particular for smaller projects such as surface water schemes. The Environment Agency are also encouraging lead local flood authorities and other risk management authorities to pool resources to deliver projects more effectively. This would improve efficiency in using the available skills and resources of local councils on surface water flood risk management. This approach builds on the success of coastal partnerships. 

The Environment Agency are exploring further operational measures that could expedite surface water schemes in the current programme. For example, ways to form packages of local surface water projects. This would enable co-financing negotiations for the whole package and not by individual projects. 

To support the local authorities in preparing strong business cases the Environment Agency has established a community of practice through its ‘Supporting Flood and Coast Projects’ site (which now has over 900 external subscribers).

This aims to give all risk management authorities equal access to support, tools, guidance and learning materials, and includes the ‘Skills Academy’ which has guidance and templates on engagement. E-learning modules are also being made available through this platform. 

Government will monitor the progress of the Environment Agency’s operational measures via our quarterly Portfolio Board, where we will require updates on the implementation of these measures and the impact on local authority delivery. The Infrastructure and Projects Authority also reviews the overall Flood and Coastal Erosion Risk Management capital programme annually and continues to monitor progress against their recommendations related to streamlining of processes and packaging of schemes. 

We are committed to reviewing the policy and delivery model for future investment programmes, reflecting what is most appropriate at that time, delivers for all and enables the government to fund schemes where the need and benefit is greatest. The government will make decisions on future investment in flood risk management through spending reviews.

Property flood protection measures 

The study reports that it is not possible to protect all properties cost-beneficially and estimates that 170,000 to 200,000 properties could remain at high risk from surface water flooding in 2055.

The National Infrastructure Commission’s analysis shows that cost beneficial investment is primarily in urban areas, potentially protecting between 50% and 70% of high risk properties in cities and towns compared to 15% and 25% in rural villages. This is because in places with many properties at high risk, the cost of an intervention will be spread between more properties, and so the cost per property will be lower. However, other interventions may be cost beneficial including property flood resilience measures that prevent water from entering a property or enable quicker recovery.

Recommendation 9: by the end of 2024, government should explore options for funding property level flood protection measures for those properties that remain at high risk of surface water flooding because improving drainage infrastructure is not cost effective.

The government accepts this recommendation. 

The government supports and encourages the use of property flood resilience measures through its flood investment programme and through Flood Re’s Build Back Better scheme. 

The Environment Agency’s Flood and Coastal Erosion Risk Management Strategy Roadmap to 2026 aims to mainstream property flood resilience measures that reduce flood damages, including through the Be Flood Smart awareness campaign, a joint initiative between the Environment Agency and Flood Re. 

As part of our ongoing work to consider funding policy and needs for a future capital programme from 2027, we will undertake a review of the options for funding property flood resilience which will cover the National Infrastructure Commission’s recommendation and wider factors around the most cost-effective use of the different options for resistance and ‘recovery’ property flood resilience measures. This work will consider the appropriate contribution of and impacts on different parties including: 

• the future policy on flood capital grant in aid for property flood resilience in different circumstances
• the role of water company investment in property flood resilience as part of their portfolio of surface water management interventions to reduce rainwater in the sewerage system, including how this links to differential billing
• the role of the insurance sector
• property owners and developers  

We will also continue to work with stakeholders and partners, to encourage take-up of property flood resilience measures for those at high risk of flooding, including from surface water.