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A multimillion-pound mopping-up operation was today under way in Cornwall after flash floods forced hundreds of people from their homes and devastated businesses. All the flood and severe weather warnings for the area were lifted as the clean-up and recriminations continued.

Environment ministers are expected to make a statement to parliament, setting out extra support for some of the worst-hit areas. The government faces criticism for cutting funding for flood defences, but promised yesterday that it would do all it could to restore towns and villages wrecked by the deluge.

Agencies including the Met Office, the Environment Agency and Cornwall council also faced questions over whether they had given sufficient warning of the downpour and been well enough prepared to cope with the aftermath. Lord Smith, the chairman of the Environment Agency, warned that future flood defence works might be hampered by a tight funding settlement.

Speaking to BBC Radio 4's Today programme, he said: "The good news is that now the flood waters are receding in Cornwall and now the clean-up operation has to get under way." But he added: "Where we will have difficulty, I fear, over the coming couple of years is in starting new flood defences that might have been possible."

Hundreds of residents spent last night in emergency accommodation after being evacuated from their homes.