Kevin Humphreys (Dublin South East, Labour)
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I will be brief. I am grateful to the Chair for allowing me to raise this Topical Issue. I recognise the work that the Minister of State, Deputy Brian Hayes, has done on this issue over some time. While I intend to focus on a local example from Dublin South-East, I emphasise that this is a national issue. In 2007, some €13 million was spent on flood defences along the River Dodder to protect an area stretching as far as Lansdowne Road against a flood event that was likely to occur once every 200 years. Following the heavy flooding that was caused by rain in October 2011, a further €2 million was spent on emergency works and new flood defences along the river as far as Ballsbridge. Work has now started on flood defence works costing approximately €10 million to protect an area extending as far as Donnybrook and Clonskeagh. This means that over €25 million will have been spent to protect homes, communities and businesses along the River Dodder.

Taxpayers and the Government need to see a dividend from the money that has been spent on the protection of these communities. When I surveyed 1,000 homes in an area covering Ringsend, Sandymount and Bath Avenue, I found they cannot get flood cover or, if they can, their policies have been doubled.

For the most part they have not been able to get flood insurance. This is replicated in Carlow, Cork, Donegal and across the country. Every week members of my community contact me about the problems of getting flood insurance. They are people who want to sell, to downsize, or who have outgrown their family home and want to move to another property. They are locked in because the person who wishes to buy their home cannot get a mortgage as they have failed to get flood insurance. Nobody can buy because nobody can get flood insurance.

I have organised meetings between Dublin City Council and Insurance Ireland, formerly the Irish Insurance Federation, to ensure the transfer of information from the council and the OPW, to enable insurers to see the quality and quantity of work done. We urgently need to bring forward a clear protocol. If the taxpayer spends this much money there has to be a dividend. The insurance companies need to co-operate but if they fail to do so, and if this cannot be achieved by agreement or protocol, I call for legislation.

Earlier this year Insurance Ireland indicated that it would come forward with a protocol in September saying to the effect that it had a mechanism to recommend to its members to give flooding cover where the OPW has invested such large moneys in flood protection. It has failed to do that. Families are living in overcrowded conditions and want to move on. Older people want to downsize and move to something more suitable but they are locked in. The OPW has spent over €40 million on this one small area and that is not recognised. At this stage we need to move on urgently. We need to say to the insurance industry that it should introduce a protocol or agreement or this House will bring forward legislation.

John Perry (Sligo-North Leitrim, Fine Gael)
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On behalf of the Minister of State at the Department of Finance, Deputy Brian Hayes, I thank the Deputy for providing the opportunity to update him and the House on developments on this matter.

I am fully aware that the issue of obtaining flood insurance cover is a matter of some concern to some people in certain locations around the country, whether in terms of the higher premia they are being asked to pay or where their existing insurance company indicates it will no longer provide such flood cover specifically. Insurance Ireland, formerly the Irish Insurance Federation, has indicated that the incidence of such difficulties remains at a low level and that only of the order of 2% of insurance policies nationally are involved. Nonetheless 2% of households represents a significant number of affected people and for this reason the Government is anxious that the problem is addressed.

The Minister of State, at the Department of Finance, Deputy Brian Hayes and his officials in the OPW have been actively engaged with the insurance industry for some time in regard to the transfer of information on completed flood defence schemes. In January 2013 a working group was established with representatives from the OPW, Insurance Ireland and the main household insurance companies operating in the Irish market to consider and address this issue. This group has a specific aim and purpose and it is important that this and the role of the OPW in the process are clearly understood.

It must be emphasised that the OPW has no role or function in regard to the oversight or regulation of the insurance industry or of insurance matters generally. The discussions between the OPW, Insurance Ireland and the insurance companies have a specific focus and are concerned solely with agreeing a basis on which information can be provided to the insurance industry on flood relief schemes completed by the OPW and the standard of protection offered by those schemes.

The discussions have been complex and quite technical in nature and it is important that all matters are addressed in a comprehensive way that will ensure that the system of data exchange is robust, reliable and sustainable. I am happy to report that the working group has made very good progress and agreement has been reached on a data-sharing platform which will facilitate the transfer of detailed information on completed OPW flood relief schemes. This will allow the insurance industry to properly take into account the levels of capital investment in flood protection measures over several decades by the OPW when assessing flood risk in localities where such flood measures have been completed.

The information being provided is in a readily accessible format which will show in digital map files the areas benefiting from completed flood defence works. The initial focus of the group's work is the provision of information on schemes which provide protection for the one in 100 year flood. The OPW has provided an initial batch of information to the insurance companies and the latter are currently working on integrating this information into their own individual operating systems. It is expected that this work will be completed shortly.

It is intended that the OPW and Insurance Ireland will agree a memorandum of understanding to guide present and future interaction between the insurance industry and the OPW in regard to communications around completed flood defence works. The OPW is satisfied that the insurance industry is engaging constructively and positively in this process and that there is a strong willingness to co-operate on implementing a sustainable system of information exchange. Ultimately, it is a matter for the insurance companies themselves to decide how they will use the information provided on completed flood defence works. As part of the process they are committing to take the information into account in their assessment of risk and it is to be hoped that this will facilitate the provision of flood cover in all areas that are protected by completed schemes.

Finally, I remind the Deputy of the avenues available to those having difficulty, complaints or queries in seeking insurance cover through Insurance Ireland's free insurance information service. In addition, the Financial Services Ombudsman deals independently with unresolved complaints from consumers about their individual dealings with all financial service providers.

Kevin Humphreys (Dublin South East, Labour)
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I thank the Minister of State for his reply. I know that this is not his area. What I hear in the response is that the insurance industry is talking the talk but delivering very little. There is nothing really new in the reply from the industry. Insurance Ireland came before the Oireachtas Joint Committee on the Environment Community and Local Government where it cited the figure of "only 2%". Our evidence shows that this affects far more than 2% of householders. The industry has put a 500 metre extension on either side of every river in the country. The houses at the top of the hill in Lucan Village cannot get household insurance. In Cork, the houses at the top of Patrick's Hill - we all know how steep that is - cannot get flood insurance.

What I hear again today is the insurance industry saying it will co-operate while nothing happens on the ground yet we spend large sums of taxpayers' money to ensure that flood protection is provided. In my own area flood protection is at the level of a one in 200 year event. That is far above what the insurance industry talks about in any other area. It is double the standard it seeks. I facilitated the transfer of information from Dublin City Council and the OPW to Insurance Ireland, which made pledges that it would respond within a week and said that the information seemed to be correct.

The OPW is one of the best groups to work on flood relief. In my constituency, and many other constituencies, it has done excellent work. I ask the Minister of State to tell his colleague, the Minister of State, Deputy Brian Hayes that we have listened carefully to the insurance industry but we have seen very little action. I believe that it is now time for action from this House to tell the insurance industry to get its act together and let the taxpayer see a real dividend from the excellent work carried out by the OPW. While this is an important constituency matter for me, it is equally so in many areas across the country where there is such a large investment. The OPW spends approximately €40 million a year on flood protection. We need to see a dividend from money that we spend on behalf of taxpayers. I am telling the insurance industry to get its act together or we will bring in legislation to ensure that this insurance cover is provided. I have been dealing with this matter for 10 years and the insurance companies are great at talking the talk but not very good at walking the walk.

John Perry (Sligo-North Leitrim, Fine Gael)
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I thank Deputy Humphreys. His point is very well made.

He wants action and results. The catchment flood risk assessment and management plan is well under way. I will provide some background information. Studies carried out under the programme will provide the most comprehensive survey of the flood risk associated with Ireland's waterways. In total, more than 3,500 km of major water courses are being subjected to these detailed surveys. A scale of measurement will allow for the development of sophisticated hydraulic models.

Regarding the issue of whether the Government will consider alternative ways of addressing the problem such as a State indemnification scheme or an insurance pool type of solution, a State indemnification scheme for those unable to obtain flood insurance has been considered before. While it is difficult to quantify the cost in any particular year over a period of time, it is possible to say that the cost would be significant on the basis that there have been eight major flood events costing the insurance industry approximately €700 million in flood claims from 2000 to 2012. These costs would be in addition to the normal infrastructural costs arising from flooding such as repair of roads and bridges.

If a scheme of this type were established, there exists a very real possibility that the industry would have a strong incentive to discontinue the provision of flood cover in medium to high-risk areas thus increasing the potential cost of the scheme over time. Therefore, such an arrangement has the potential to undermine the nature of existing private insurance, making it difficult to withdraw even if it were introduced on a short-term basis.

In respect of the point made by Deputy Humphreys, I will speak to the Minister of State. Perhaps there could be a round table discussion in the committee rooms with the Minister of State. Deputy Humphreys has ten years of experience on this and has a deep knowledge of what he is talking about. It is unreal that if people live at the top of a hill, they cannot get insurance. People want action. The OPW does outstanding work but what Deputy Humphreys wants is collective action on behalf of the insurance companies to deal decisively with this problem. I have no doubt the Minister of State will take note of the concerns raised by the Deputy and I ask him to arrange a meeting with the Minister of State to see about convening a round table discussion with the insurance industry in Leinster House.