On 10-Feb-2014 17:19:35 John Bibby wrote:
> Chris Smith said the treasury rule requires a benefit/cost ratio of
> "at least eight".
>
> They are discussing it on PM right now.
>
> But where does the number 8 come from? I thought it would be about 1.
> JOHN B
I heard it myself on World At One (at about 13:30), again uttered
by Lord Smith. He gave the 8:1 ratio, and said that it was a "government
spending rule" ... I have no idea what the basis of the "8:1" rule is
(but see below ... ).
Interestingly, a minute later in the program, there was an interview
with Professor Richard Ashley who, "ten years ago", was a co-author
of a report into flood risks and their management. From his Sheffield
University web-page:
https://www.shef.ac.uk/civil/staff/research/ashleyr
I infer that this was the two-volume:
Future Flooding Vol I -- Future risks and their drivers. (2004).
Evans EP., Ashley R M., Hall J., Penning-Rowsell E., Saul A.,
Sayers P., Thorne C., Watkinson A.
Foresight.. Office of Science and Technology. April.
Future Flooding Vol II -- Managing future risks. (2004).
Evans EP., Ashley R M., Hall J., Penning-Rowsell E., Sayers P.,
Thorne C., Watkinson A.
Foresight.. Office of Science and Technology. April.
He said that the Government had ignored their conclusions and their
recommendations ever since. He sounded quite vehement.
For the World At One broadcast, go to:
http://www.bbc.co.uk/programmes/b03tr3mw
Lord Smith is at about 33:00, followed by Richard Ashley at about 34:00.
I have tried to find out whether these reports are publicly available,
but no luck so far. They could be interesting reading, especially if
compared with the current situation!
If anyone has a lead as to where (or if) they can be accessed, I'd be
most obliged.
John, as to your "But where does the number 8 come from? I thought
it would be about 1" -- come on, John, don't be silly! The 8:1 ratio
would encourage the money to be spent where it will do most good!
You have a housing estate of some 30 houses built after the developers
engineered planning permission to build on a flood plain. Average value
of each house: £150,000. Total value: £4.5 million.
As it happens, the cost of upgrading the flood prevention for the
area would be £5 million. On your 1:1 principle, that money should
be spent on protecting their homes.
But, in fact, their insurers will probably pay up (if they could
afford the premiums in the first place), and in any case they can
be moved to some other estate of "affordable housing" -- probably
also on a flood plain. So no problem. At best they're only farmers,
and moving them around will do no harm.
Meanwhile, further upstream is a small village, also at risk of
flooding, where there are 5 houses each worth £8 million. The "8:1"
rule ensures that these are eligible for flood protection upgrade,
which is much better value -- especially since their owners are
City financial traders, for whom the worry and distress due to
flooding, or the risk of flooding, could impair their judgement
and result in serious instabilities in the Stock Market.
John: get your priorities right!
Best wishes to all,
Ted.
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E-Mail: (Ted Harding) <[log in to unmask]>
Date: 10-Feb-2014 Time: 20:43:35
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