My Lords, at the outset I declare an interest: I am the chairman of an insurance broking organisation. I welcome this Bill as I recognise that a binding agreement on flood risk management is long overdue. The recent floods in Cumbria caused widespread devastation, surpassed only by the 2007 floods which resulted in 13 deaths and extensive damage to properties at a cost of over £3 billion. The Environment Agency announced that the severe flooding in Cumbria last year was a phenomenon to be expected only once every thousand years. Although the circumstances were unforeseen, they can serve as a catalyst for better flood preparation in the future.

Many homes and businesses have been ruined by the effects of torrential floods; livelihoods have been shattered and in some cases, irreplaceable items have been destroyed. The Association of British Insurers has estimated that payouts resulting from the floods in Cumbria alone will be made in the region of between £50 million to £100 million, and may even surpass that figure. Flood damage has caused considerable losses to the insurance industry, which may result in the charging of higher premiums and application of terms in areas which are prone to floods. One in six homes in the United Kingdom is at risk from flooding. Better flood management and funding is essential to provide those at highest risk with adequate assistance.

In many instances the psychological damage caused by these floods will be difficult to overcome. Affected communities should be given additional emotional support through initiatives such as counselling for those who wish to make use of the service. The Bill provides developers with the responsibility to make sustainable drainage systems available in housing and commercial properties. An effective framework is needed to minimise the economic and social upheaval caused by flooding. Central and local governments must work together to successfully tackle flooding and give leadership to local communities on how best to prepare and equip themselves for floods.

There is growing concern that many individuals are unaware that they live or work in areas that are prone to floods or coastal erosion. A number of people in Cumbria did not arrange insurance cover and, as a result, have suffered financial hardship. What steps will the Government take to raise awareness of possible flooding in high-risk areas so that individuals can seek adequate insurance protection? There are specialist insurance brokers who can provide appropriate cover in areas which are prone to flooding. This legislation must end the confusion over which bodies have responsibility for flood-risk management. Although the Environment Agency should have an overview of all types of flooding, local communities have an important role to play as their knowledge and expertise is crucial to rescue efforts, both during and after flooding.

The Pitt review called for the allocation of clearly defined roles for flood management. It is encouraging to see that this recommendation is a requirement of the Bill. I welcome Clauses 7 and 8 as they make it incumbent on the Environment Agency to devise a strategy for flood and coastal-erosion risk management in both England and Wales. We need, however, to examine details of these clauses at later stages of the Bill. The agency should have the full confidence of both central and local government-related agencies to adequately develop a strategy that is free from political or commercial bias. It is important for the agency to present regular reports to policy-makers that include independent flood-risk assessments which also detail funding requirements and proposals for dealing with imminent floods. The agency should also devise a long-term plan for flood-risk management and must be given responsibility for creating accurate, national flood maps covering all sources of water damage to be made available to the public. There are opportunities for the Environment Agency to consult with tertiary institutions to promote the research and skills required for effective flood and coastal-erosion risk management.

I support Clause 13 as it ensures that local authorities communicate and co-operate with relevant bodies concerning flood and coastal-risk management. Resources such as flood maps are essential to the industry. There is scope for local agencies to collaborate with the Environment Agency in the production of local flood-risk maps. Local authorities have the potential to become the leading agencies in charge of assessing local flood risk in specific areas. Insurers and loss adjusters have a duty to advise local communities susceptible to flooding whether they should build in flood resistance to best prepare their homes for possible floods.

I welcome the provision which grants greater power to local authorities when managing flood risks as they are best placed to deal with the initial effects of flooding due to their knowledge of their areas. The proposal to promote multi-agency co-operation is also encouraging. A lack of broad agency collaboration has been cited as one of the barriers to effective flood management. Local authorities must work in concert with the Environment Agency to enable the development of a national overview of surface-water flood risk.

I agree with Clause 35 which proposes to regulate the provision of infrastructure by a third party for the eventual use by water or sewerage undertakers. I support Clause 36, which amends the Water Industry act 1991 to enable water companies to prevent or restrict the use of water at times when serious shortages occur, or are at risk of occurring. We have had situations in this country when there has been a lack of rain and a shortage of water. The use of water must be controlled under these circumstances. However, we must work out the details, perhaps in the form of issuing a suitable code. I will add that during the last drought, I lived in a house with five acres of grounds and encountered great difficulty in keeping my plants alive because of the hosepipe bans.

Water companies should be free to impose charges for connecting new developments to give access to sewerage and water networks. They also have a duty to ensure that new developments do not increase the risk of future damage. Clause 38 allows the Environment Agency to engage in works that may cause flooding, provided this is in the interests of natural conservation or civic enjoyment. I hope that the conditions of the clause will be examined in more detail in Committee.

We need to examine the provisions of Clause 39, which allows lead authorities or internal drainage boards to carry out works under certain conditions that will or may cause flooding, an increase in the amount of water below the ground, or coastal erosion.

I welcome Clause 42, which introduces a new section into the Water Industry Act 1991 that requires the owners of premises and sewers to connect with the public sewer. This requirement is, first, on the proviso that an adoption agreement exists between the owner of the sewer and the sewerage undertaker; and also that the agreement must include details concerning the standards that the constructed sewer or drain should meet. In most cases, repairs will be carried out in accordance with the same regulations that did not prevent water damage occurring in the first place. I would like to see a provision that will ensure that construction repairs are made in such a way as to prevent future floods from causing the same degree of damage. This would in turn reduce the costs and the level of disruption to local community groups. I recommend that local housing authorities be asked to provide low-cost insurance in high flood risk areas, perhaps on the lines of tenants’ contents insurance with rent schemes. This should gain wide support.

I am concerned at the number of householders and businesses without appropriate insurance who, in the event of flooding, will encounter financial and personal hardships. It is encouraging to witness broad political consensus for the majority of proposals in the Bill. I am confident that it will be adequately strengthened during its passage through your Lordships’ House. We have a duty to ensure that the Bill greatly contributes towards managing the rising threat of water damage, which is critical for the 5 million properties nationwide that are most at risk of flooding.