The agreement runs out in 2013 and council leaders fear that the insurance industry may refuse to offer affordable cover if it does not have confidence that sufficient resources are being invested in flood defences. Householders, businesses and local and central government would be left to pick up the bill for repairing the damage caused by any future floods.
One in six properties in England and Wales is currently at risk of flooding.
According to the Environment Agency, spending on flood risk management will need to double to £1 billion per year by 2035 just to maintain the number of properties currently protected from flooding.
From April 2011, councils will incur new costs as they take on new responsibilities under the Flood and Water Management Act.
Flood risk management is just one of the vital services that could benefit from a radical change in the way the public sector operates, proposed by the Local Government Association, which represents more than 350 councils in England and Wales.
In the face of an unprecedented squeeze on public spending, council leaders are calling for a once-in-a-generation programme of change to strip out the plethora of funding streams, accountability regimes, ring-fenced budgets, quangos and funding bodies to release savings of up to £20 billion a year.
The LGA argues that public services can be made cheaper, simpler, more effective and more transparent by making locally-elected people responsible for allocating public money and taking decision about local services.
Cllr Gary Porter, Chairman of the LGA Environment Board, said:
“The Government has made it clear there are going to be deep cuts in public spending. But there is a real danger that if sufficient resources are not put into managing the risk of flooding millions of households could find themselves in the awful position of being unable to insure their property against the risk of floods.
“There are huge opportunities to save money by giving power to the people who know their areas best and who can direct funding where it is needed most. By simply reducing spending we will do nothing to cut waste and instead hurt the frontline more than we need to.
“We all remember the destruction that the 2007 floods caused. It is absolutely imperative that the Government does all it can to reduce the risk of it happening again and that if it does, ordinary people are not left to fend for themselves.”
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