UK floods: prevention is better than cure. Photo: Getty
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Counting the £1bn cost of the winter floods

This week it's six months since the winter floods struck, and from the latest available figures it looks like the floods have cost the country over £1bn.

Six months ago, the UK was wracked by the wettest winter ever, leaving thousands of households flooded and devastating communities from Somerset to Hull. The risk of flooding is now out of the headlines, but for many families still counting the costs, the problem remains extremely real.

What's more, the likelihood of terrible floods is increasing: climatologists at Oxford University have recently calculated that climate change made the 2013-14 floods 25 per cent more likely. Faced with this prospect, it's clear the government needs to be doing all it can to bring down emissions and stop the costs of future flooding soaring still higher.

But what have the total costs of the most recent floods been? I've been reviewing the latest available figures and can conclude that the 2013-14 floods have cost the nation at least £1.1bn.

Here's how it breaks down:

1) Insurance claims: £451million

In March, the Association of British Insurers (ABI) estimated that insurance claims could be £446m. Friends of the Earth has since corresponded with the ABI, who told us in early June that "The final data collection suggested a cost of £451m for the winter floods" - and this is just for incurred insurance claims.


2) Uninsured costs: £130million

In February, PwC estimated that insurance claims from the floods would total £500m, and that total 'economic costs' would sum to £630m - in other words, additional uninsured costs would be around £130m.

Also in February, the NFU's head of policy services, Andrew Clarke, estimated that the cost of the floods to farmers could reach £50m-£100m. Some of this may be able to be claimed back through insurance; a portion of it may also be covered by the Government's Farming Recovery Fund (see below); but additional costs may still remain.


3) Central Government support and repairs: at least £540million

The Government states it has made £540m available for flood recovery, in the form of various grants for businesses, households, and farmers; for flood defence repairs; and for patching up transport infrastructure.

Not all of this money, however, has yet reached the intended beneficiaries. For example, farmers say just five per cent of the Government's Farming Recovery Fund has been paid out to them so far - with the grants of just £5k per farmer proving very bureaucratic to obtain and each form taking a fortnight to process.

The £270m made available for flood defence repairs, meanwhile, may not be sufficient to cover the total costs of damages. The grant was announced before full estimates of damages had been completed by the Environment Agency (EA). A joint review of the state of flood defence damages was completed by the EA and the British army before Easter, and reported that around 1,000 defences had been damaged or were undergoing repairs. Subsequently a more detailed appraisal was carried out by engineers, and the latest publicly-available statements from the EA's Flood Recovery Programme team suggest that the total number of damaged assets now stands at 1,300. A full breakdown of damaged defences is expected to be released in early July. Whether the costs of repair will exceed the £270m pot made available is as yet unknown.

A detailed analysis of the costs of the floods undertaken by Channel 4's Factcheck in early February came to a slightly higher figure for costs borne by the state being £583.6m. This used a slightly different methodology, adding in the costs of pumping water in the Somerset Levels, some estimated costs of repairing damaged rail track, and estimates for Local Authority claims under the Bellwin Scheme - the means by which flood-struck councils can recoup some of their costs from central government.


4) Local Government costs and claims under the Bellwin Scheme: at least £6.6m

A Freedom of Information request made by Friends of the Earth to the Department of Communities and Local Government (DCLG) has revealed that by early June, 13 local authorities had reported total costs of £6.6m, of which £4m has been above the Bellwin Scheme's thresholds and has therefore been submitted as claims to central government. However, this is unlikely to be the final figure, with applications open until the end of June and DCLG expecting further claims. The Local Government Association has said that it will take "some time" before the final costs are known.


5) Lost output due to closed businesses, travel disruptions and blackouts: unknown

Travel disruption over the winter was considerable, with the Westcountry effectively cut off for two months after coastal surges destroyed a stretch of rail track near Dawlish. The Department of Energy & Climate Change record that almost one million customers were affected by power disruptions during the Christmas storms. The Office of National Statistics states that there is some evidence that construction output was affected by the storms and floods.


6) Longer-term costs?

Longer-term costs at this stage remain hard to estimate, but the 7,800 homes that were flooded during the winter could well see their insurance premiums go up, while the value of the houses could be dented. There is also a feared longer-term impact on agricultural land prices in Somerset, where the fertility of fields were badly affected by being underwater for months.


Conclusion: prevention is better than cure

When the coalition first entered office, it slashed spending on new flood defences and cut maintenance. This is now looking like a terrible false economy, and the government is having to pay far more to mop up the mess left by the floods than it cut originally.

The Committee on Climate Change warns there is now a half-billion pound shortfall between flood defence investment and what's needed to keep pace with our changing climate. The government needs to invest properly in flood management, but most of all it needs to ratchet down the emissions causing climate change - which if left unchecked will lead to ever-more costly floods in the future.

Guy Shrubsole is energy campaigner at Friends of the Earth.

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Geoffrey Howe dies, aged 88

Howe was Margaret Thatcher's longest serving Cabinet minister – and the man credited with precipitating her downfall.

The former Conservative chancellor Lord Howe, a key figure in the Thatcher government, has died of a suspected heart attack, his family has said. He was 88.

Geoffrey Howe was the longest-serving member of Margaret Thatcher's Cabinet, playing a key role in both her government and her downfall. Born in Port Talbot in 1926, he began his career as a lawyer, and was first elected to parliament in 1964, but lost his seat just 18 months later.

Returning as MP for Reigate in the Conservative election victory of 1970, he served in the government of Edward Heath, first as Solicitor General for England & Wales, then as a Minister of State for Trade. When Margaret Thatcher became opposition leader in 1975, she named Howe as her shadow chancellor.

He retained this brief when the party returned to government in 1979. In the controversial budget of 1981, he outlined a radical monetarist programme, abandoning then-mainstream economic thinking by attempting to rapidly tackle the deficit at a time of recession and unemployment. Following the 1983 election, he was appointed as foreign secretary, in which post he negotiated the return of Hong Kong to China.

In 1989, Thatcher demoted Howe to the position of leader of the house and deputy prime minister. And on 1 November 1990, following disagreements over Britain's relationship with Europe, he resigned from the Cabinet altogether. 

Twelve days later, in a powerful speech explaining his resignation, he attacked the prime minister's attitude to Brussels, and called on his former colleagues to "consider their own response to the tragic conflict of loyalties with which I have myself wrestled for perhaps too long".

Labour Chancellor Denis Healey once described an attack from Howe as "like being savaged by a dead sheep" - but his resignation speech is widely credited for triggering the process that led to Thatcher's downfall. Nine days later, her premiership was over.

Howe retired from the Commons in 1992, and was made a life peer as Baron Howe of Aberavon. He later said that his resignation speech "was not intended as a challenge, it was intended as a way of summarising the importance of Europe". 

Nonetheless, he added: "I am sure that, without [Thatcher's] resignation, we would not have won the 1992 election... If there had been a Labour government from 1992 onwards, New Labour would never have been born."

Jonn Elledge is the editor of the New Statesman's sister site CityMetric. He is on Twitter, far too much, as @JonnElledge.