Funding Coastal Defence
Funding coastal defence (link to Briefings) is a complex topic, partly because the rules, mechanisms and budgets frequently change, in response to political, economic, environmental and social factors. For an idea of the complexity, read our report to the National Audit Office.
In November 2010 the EA and DEFRA launched two public consultations on these issues: Future Funding of coastal erosion work, and Future Arrangements for Flood & Coastal Erosion Risk Management, to which MPSG responded in detail. To see our full responses, go to our national consultations page and click on relevant pdf files. In 2011 the government altered the funding system much along the lines in its consultation, and renamed it “Partnership Funding”.
Traditionally, funding for coast defences was paid for by local authorities, who were then reimbursed by central government. From 2005 to 2011 the money came direct from central government, in the form of a grant called “Flood Defence Grant in Aid” (FDGiA). Under “Partnership Funding” the FDGiA pays some of the cost of schemes, but “external contributions” (i.e. financial contributions from non-government sources such as local residents, developers, councils etc) are expected in all but a tiny number of schemes and the government FDGiA is simply a “top up” to ensure the scheme can be paid for.
Demand for FDGiA funding has always outstripped the amount of money government is prepared to allocate to flood & coastal defence.
Under FDGiA/Partnership Funding, local authorities (or the EA itself) put forward proposals for coast defence works (called “schemes”). All the proposals from around England are then prioritised by the EA according to a set of fiendishly complex tests, called “Outcome Measures”. The end result is that each scheme is given a score of a certain number of points. Depending on how much money central government allocates to coastal defence in a particular year, only schemes with a certain number of points will get funded.
Very few schemes will get 100% funding – in most cases some external contributions are needed to reduce the cost of the scheme to the government, which pushes up the scheme’s “benefit:cost ratio”, and increases the point-score of the scheme to the point where it qualifies for a government contribution.
In practice what happens is that large towns and cities generally get a higher score than small towns or hamlets (because more properties are protected for every £ spent on defences). Also, flood defence schemes generally get higher scores than erosion defences (usually, a lot of properties are destroyed quickly by flood, whereas erosion usually picks off properties one-at-a-time over a longer period).
Another major problem has been that the funding (when available) was only for “capital” works. This meant substantial reconstruction, or building of new coast defences – not the maintenance of existing defences. This funding arrangement had the perverse effect that an authority which allowed its defences to crumble might have got funding from government to build new ones, whereas an authority which carefully maintained its defences wouldn’t get any financial assistance.
This naturally encouraged authorities to hold back on annual maintenance, in the hope that government funds would be available for “capital works” once the defences were beyond repair. The risks of this strategy became apparent when the public finances suddenly took a turn for the worse, or when numerous coastal defences all around the country reached a condition where they need replacement.
MPSG lobbied central government hard to change this anomoly of the funding system, and under Partnership Funding the government now allows FDGiA funding of many maintenance works (through what is called Beach Management Plans – medium term plans of beach maintenance, including shingle recycling and minor repairs to groynes etc).
For more information go to our news item on this issue, available here.
See Current trends