Very much this.

Not only is building on a flood plain fairly short sighted, but it restricts the amount of water the area can take when there is flooding so that areas that the flood plain is supposed to protect are then at risk.

How about councils who allow building on land that they know to flood? From what i've seen, if enough money passes hand they will always sign in the end.

Yes but with the government pushing for ever more building on flood plains the developer will simply bypass the council and appeal directly to the minister. They are all guilty. Make them personally liable and then it will stamp this practice out.