Key themes from recent Environmental Audit Committee sessions
Recent evidence sessions of the Environmental Audit Committee have focused on environmental sustainability and housing growth (30 June) and flood resilience (9 July). These discussions are highly relevant, particularly in light of the government’s ambition to build 1.5 million homes during the current parliamentary term. The insurance sector continues to raise concerns that this goal could increase flood risk – particularly surface water flooding – both for new homes and for surrounding communities.
Key takeaways
Growing flood risk – especially from surface water
- Philip Duffy, Chief Executive of the Environment Agency (EA), emphasised a significant rise in homes at risk from surface water flooding – with 4.6 million additional homes affected – even as fluvial flood risk remains broadly stable.
- Surface water flooding is seen as a ‘forgotten risk’ – often under-recognised in planning decisions and not always mitigated by traditional flood defences.
- Dr Sebastian Catovsky (DEFRA) and Minister Emma Hardy both pointed to the importance of using the new NAFRA 2 dataset, which for the first time provides detailed surface water risk mapping.
Concerns over new development
- The EA reiterated concerns about new homes being built in flood-prone areas, and the potential for new developments to increase the surface water flood risk for existing neighbouring communities.
- This aligns with the issues raised in the 30 June session, where Mr Duffy criticised planning authorities for occasionally ignoring EA flood risk advice.
- The need to consider flood risk at the strategic planning stage – not just on a site-by-site basis – was repeatedly highlighted.
- The disconnect between land use planning and water regulation systems remains a major barrier.
Clients may wish to note this echoes concerns set out in our recent client alert on planning and flood risk, and the proposals in Blake Stephenson MP’s Private Members’ Bill, which aims to strengthen obligations on developers and planners to consider flood resilience.
Sustainable Drainage Systems (SuDS)
- SuDS featured prominently in both sessions. There is broad support for their wider rollout, but concerns persist over:
- inconsistent implementation and maintenance;
- lack of enforcement of SuDS-related planning conditions; and
- the absence of a statutory requirement to install and maintain SuDS (though guidance is improving).
- Minister Hardy confirmed that new national SuDS design standards were introduced in June 2025, and that the government is still considering whether to enact Schedule 3 of the Flood and Water Management Act 2010.
Build Back Better and Property Flood Resilience (PFR)
- Minister Hardy expressed a clear desire for 100% of insurers to offer ‘Build Back Better’ – allowing flooded policyholders to use claim funds to install resilience measures during reinstatement.
- So far, only 1,800 claims have included Build Back Better enhancements – a figure the Minister said must rise.
- Insurers were encouraged to simplify the process and to offer premium reductions for properties made more flood-resilient.
- A new trade association for flood-resilient building professionals is under development to address current skills gaps.
- The ongoing Bonfield Review is expected to make further recommendations on embedding resilience into flood recovery.
Systemic challenges
- The EA described flood risk management as a “team sport” requiring stronger local and cross-sector collaboration.
- Resource pressures remain acute. Local authorities often lack technical flood expertise and enforcement capacity.
- Duffy called for investment in modernising the EA’s IT and data-sharing systems to support geospatially enabled strategic decision-making across agencies.
Implications for insurers and businesses
- The intersection of flood resilience and housing policy is clearly rising up the political agenda.
- Insurers in particular may come under increased pressure to support Build Back Better and offer more transparent incentives for customers to invest in property flood resilience.
Retailers, infrastructure operators, and large employers should be alive to the rising risk from surface water flooding and consider how resilience can be built into asset management, contingency planning, and capital investment. - Those engaging with local planning authorities should be aware that flood risk objections by the EA may not always be upheld – but choosing to proceed in such cases carries reputational and practical risks.
We will continue to monitor progress, particularly the Bonfield Review, future developments on Schedule 3 implementation, and further discussion of Blake Stephenson MP’s Private Members’ Bill.
For further information please contact:
Natalie Larnder - Head of Market Affairs
NLarnder@keoghs.co.uk
Matthew Rogers - Head of Property Risks & Coverage and Climate & Emerging Risks SIG Lead
mrogers@keoghs.co.uk
