Ownership of more than 2,000 miles of inland waterways was transferred to the charitable sector last month when the state-owned British Waterways became the Canal and River Trust.
The new organisation has secured a 15-year funding contract with the government worth £800 million to help it maintain the canal and river network. This arrangement supersedes the previous funding mechanism which saw British Waterways receive an annual grant from the Department for Environment, Food and Rural Affairs.
The trust’s independent status means it is free to raise additional money from a host of planned fundraising activities and to put together an army of volunteers who will be encouraged to give up their own time to help improve the inland waterways in England and Wales.
According to George Ballinger, head of engineering at the Canal and River Trust, the transition to charitable status gives the new body far more visibility when it comes to future budgets. “As British Waterways, maintenance on the network was funded by government with a grant. Over the years, that grant has declined and it reached the point where our board decided there was value in putting the canals in trust for the nation to secure the future,” he says.
“If you are funded by government, you are at the whim of spending cutbacks. That made it difficult to plan. When you are dealing with 200-year-old structures, getting planning right is vitally important. Recently we have had £20 million-£25 million to spend each year on what we classified as major works. But we have not believed that that amount was sufficient to properly maintain the 11,000 principal assets that we have on the network.”
The Canal and River Trust, therefore, will be funded through a 15-year contract with government, rather than a grant. The funding agreement is made up of core financing of £39 million per year, and, from 2015-16, an additional lump sum of £10 million a year which will be reduced gradually over the last five years of the contract. Furthermore, the government has also announced that the £460 million commercial property endowment used by British Waterways to fund the infrastructure network in England and Wales will be transferred to the trust for the same purposes.
Ballinger is delighted with the terms of the new arrangement. “It’s a fair deal – it gives us so much more freedom,” he says. “It’s a contract with government, not a grant, and that is a fundamental change. What other organisation can look ahead with absolute certainty for 15 years? We know what our funding will be – and that’s incredibly good news. It gives us a chance to get the trust up and running, and to start to get additional revenues on board.”
As part of the funding arrangements, the Canal and River Trust will be expected to keep its principal assets, including locks, reservoirs, boat-lifts and moving bridges, in “reasonable condition”. That process will involve the use of an asset management system to grade each piece of equipment from A to E – A being excellent, E being poor. The government has defined a number of assets that the trust is allowed to have in the D and E categories before it will remove some of the contractual funding.
In terms of how assets are assessed, detailed inspections of principal structures such as road bridges will take place every 10 years. That will provide the initial grading, along with assessments of the consequences of failure. This detailed inspection is one of the main methods of prioritising spending. “If one of our bridges won’t open, that would result in a navigation block – that’s our business shut. So that would be recorded as a high consequence,” says Ballinger.
Below this level of inspection is a more regular assessment of condition. The trust will use hundreds of maintenance staff to walk the length of the canals with handheld devices that record any defects that have already been noted. The condition of structures can then be closely monitored for deterioration.
Ballinger says that, while maintenance on the inland waterways has been benchmarked by other companies and has been regarded as an efficient model, improvements can still be made. The engineering services contractor May Gurney has been awarded a national contract for the maintenance of mechanical and electrical equipment on bridges and locks, and Ballinger thinks this will have a positive impact on performance.