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Case Study


Economy and Business Recovery
Financial Impact on Local Authorities

Incident / Exercise

Incident: Flooding in England, Northern Ireland and Wales, June/July 2007 - Restoration Fund.

Background and Context

2007 had the wettest May to July since the England and Wales precipitation record began in 1766. Around 48,000 households were flooded in June and July (defined as those where water entered the property, not just the grounds) and over 7,000 businesses were affected. The estimated total direct damaged caused by the flooding in June and July flooding 2007 was around £3.1billion.

How the Topic was Handled

On 6 May 2008, John Healey (who was appointed Minister for Flood Recovery) announced that the Government was to set up a Restoration Fund of £30.6 million for English local authorities affected by the floods of summer 2007. The government was able to make the Restoration Fund available following the success of the UK in bidding for the European Union Solidarity Fund.  Funding from this source was also allocated to the Northern Irish and Welsh devolved administrations in line with the damage they suffered.

In order to decide how to distribute the Restoration Fund appropriately, the Government launched a consultation exercise aimed at all English local authorities, police and fire authorities potentially eligible to apply to the fund, their representative bodies and other interested parties.

Following consultation, payments were made to 62 of the worst affected authorities. It was entirely up to local authorities to make decisions on how the funding was spent, using their local knowledge to target funds at their local priorities.  They could, if they so chose, share any funding they got with other local partners impacted by the floods.

The Restoration Fund was part of a comprehensive package of over £136 million to assist the affected regions and help those in greatest need, including funding for schools, transport and businesses.

The main elements of the package were:

Lessons Identified

The nature of the government’s relationship with local authorities encourages devolved decision making, and ring fences are removed from funding (where possible) to enable councils to focus resources on locally identified priorities. The European Union Solidarity Fund is focused on providing financial assistance to public bodies in the aftermath of major disasters and is intended to contribute towards the costs of damages incurred in dealing with emergency relief and reconstruction.

The government had already provided a substantial amount of funding to cover these costs which meant local authorities could get on with the job of leading recovery efforts in their communities. The decision to account centrally for the money enabled local authorities to focus their efforts in ways they thought best, without having to restrict themselves to the areas designated by the EUSF.

Contacts for Further Information [External website]

Additional Documents

The Summer 2007 Flood Restoration Fund: The Approach and Methodology Applied in Determining Allocations [External website].