Millions to pay new flood-defence taxes

Ministers are putting more people at risk from flooding while planning to introduce taxes to pay for crucial flood defences.

They are approving more than one-in-three applications to build homes on flood plains, ignoring the advice of the Environment Agency. Despite warnings by another advisory body, they plan to build 200,000 homes on flood-prone land on the banks of the Thames, in Europe's biggest regeneration scheme.

The Government, however, is expected to announce plans for two new flood taxes within weeks as those in affected areas remain on alert for severe flooding over the next three months.

Elliot Morley, the minister in charge of floods for the Department of Environment, Food and Rural Affairs (Defra), said a review of funding for flood defences, to be unveiled this month, could include a new tax on property developers. Planning permission for building on flood plains would be coupled with a "connection charge" to pay to build or maintain flood defences.

A second proposed tax would be on council taxpayers, affecting about two million people. Mr Morley said: "We accept that the bulk of the money should continue to come from the Exchequer but I don't think it is unreasonable the local authorities should have discretion, including the power to top up." The decision rests with ministers in Defra.

As residents of flood-risk areas prepared to mop up after downpours, snowfall provided a reprieve and weather forecasters predicted a cold, dry spell. River levels are still high and ground conditions are completely saturated. Mr Morley said heavy rain and further flooding were still a risk.

The Government is pleased with the flood defences. "Our warning systems have worked well," Mr Morley said. Ministers say 180 properties have been affected by river flooding, compared with 10,000 in the 2000 floods.

But critics accuse the Government of exacerbating the problem. The Government approved 288 planning applications from 758 objected to by the Environment Agency last year. On appeal, one in five was passed against the agency's advice. Mr Morley said: "We have never said there should be no development on flood plains."

A report by the Energy Savings Trust says that the regeneration scheme for Thames gateway will put another one million people at risk from flooding.

John Prescott, the Deputy Prime Minister, is expected to give details this month of the scheme, which will build 200,000 new houses along a 40-mile corridor, stretching east from London's Docklands. The Thames Gateway, Britain's largest area of brownfield land, will be a centrepiece of a communities plan. He won a commitment last month from Gordon Brown, the Chancellor, to provide money for roads, schools and health centres to encourage housebuilding. But the Energy Savings Trust's report says half of the £222bn of property threatened with flooding nationwide is already in the Thames region around London. More than 58 square miles are below the level reached by high tides and parts of Thamesmead lie 12 feet below it.

The Government has promised that money for flood defences will rise from £411m in 2002 to £564m in 2005. Insurers will continue to cover existing customers until 2007 and judge new applicants on their merits. But some homes, mainly in isolated communities, cannot get insurance and do not qualify for flood defences. Mr Morley said some cash for temporary defences might be available, but homeowners were responsible for protecting their own property and were urged to invest in home flood defences.