Parliamentary Waterways Group on Future Of The Inland Waterways

THE ALL PARTY PARLIAMENTARY WATERWAYS GROUP COMMUNIQUE ON THE FUTURE OF THE INLAND WATERWAYS

The All Party Parliamentary Waterways Group held a hearing on 8 December to provide the Waterways Minister, Richard Benyon MP, with the opportunity to respond to the Group’s Memorandum – “The Future of the Waterways”.

This was published and submitted to the Government in July, focussing on appropriate governance and financing for the Canal & River Trust which is planned to come fully into being in April 2012, inheriting responsibility for British Waterways’ inland waterways network.

The Memorandum was prepared after two hearings into these issues in order to provide a Parliamentary response to Defra’s consultation “A New Era for the Waterways” on the Government’s proposals for moving inland waterways into a new charity in England & Wales.

The hearing also gave the Minister and the charity’s Transition Trustees the opportunity to provide a broader report on progress to deliver a fully operational charity in 2012.

The hearing was chaired by the Rt Hon Alun Michael MP and attended by a number of MPs and representatives of a wide range of organisations which play important roles in relation to our canals and other waterways.

This communiqué has been approved by the All Party Group as an accurate summary of the discussion and the Group also approves its publication and distribution to waterways stakeholders and other interested parties.

Government Statement

Key issues covered in Richard Benyon’s statement, as a response to the All Party Group Memorandum, were Canal & River Trust governance and financing, and waterways classification.

Governance: the Minister reported that progress had been made on what both Government and the Trust’s Transition Trustees believed was the right model on governance for the Trust to begin life.

There was now a target for 50% of the Council to be elected over time. On membership, the Trustees had decided that the charity should not have a membership for fund-raising purposes, believing that other means of raising funds and stimulating voluntary giving were more effective for fundraising than a formal membership.

Funding: Richard Benyon could not say what government funding was going to be for the Trust since negotiations had not yet concluded. But he acknowledged that the negotiations were complex, including the issues of adequate maintenance of the canal network, mitigation of possible future liabilities arising from environmental or other legislative requirements and the staff’s pension arrangements.

He stressed that the Government was committed to a sustainable and prosperous future for the waterways, and that it wanted to give the Trust the best possible start that it could. He expected to be able to make announcements in the New Year.

Waterways classification: this had become an issue. The Inland Waterways Association had raised concerns about the proposed amendments to the system for classifying waterways in the Transport Act 1968 because it was concerned that the Trust would seek to reclassify “cruising” waterways to “remainder” waterways.

He gave an assurance that any application from the Trust to reclassify a waterway would be subject to a full cost benefit analysis and wide consultation with those likely to be affected as required by the Transport Act. In addition, he was sure that the Trustees would consult the charity’s Council and the relevant Waterways Partnership before embarking on such a significant course of action that would impact on a large number of its users. These mechanisms would help to ensure a robust and transparent process on a re-classification of any of the charity’s waterways.

In answer to specific questions from Members of the All Party Group present, Richard Benyon added:

  • He did not want or expect to see closures of any waterways, as that would not be constructive. The Government wanted to ensure that in the medium term there was scope for a reduction in the percentage of assets that were in poor and very poor condition. He added that the Government wanted the existing network to be both maintained and enhanced.
  • On ownership, in response to the suggestion that part ownership of a charity under for example, co-operative arrangements, delivered local ownership and commitment, Richard Benyon commented that he could see that possibility, locally and as a part of natural evolution.

CRT Transition Trustees

Some Transition Trustees were present, including the chairman, Tony Hales and Lynne Berry who chairs the governance committee of the Shadow Board.  The Chief Executive of British Waterways, Robin Evans, was also present. The All Party Group invited them to comment.

Tony Hales said that that the Trust would be reviewing it’s governance in 3 years and that would be the time to reflect on the suggestions made with regard to ownership.

On finance, he said that commercial activity would be the most significant contributor, and that the Trustees were comfortable about the future prospects for this commercial activity.

The Trustees were also confident about the forecasts for the contribution for voluntary income and donations, which were expected to reach £6-8m after 10 years. There were also potential contributions to be made by other government departments, local government and bodies such as Transport for London and the Olympic Delivery Authority.

It was a question of determining the benefits they receive from the network so that they recognised that a contribution was justified.

However, he reiterated the view of the Trustees that the £39m per annum offered initially by central government was not enough. The finance package overall needed to be enough to secure the network’s assets in the long term and ensure that day to day maintenance was carried out together with network dredging; and to ensure that pensions were safeguarded.

He recognised the duty of  Trustees to be in a position to satisfy the Charity Commission that the Trust was sustainable.

Lynne Berry reported on public benefit. It had been evaluated at around £500 million but that didn’t fully reflect issues such as the social return and the well being benefit etc. Trustees were currently developing the public benefit model to embrace these wider issues.

Specific issues raised were:

  • What mechanism there was to secure heritage with the new charity? The Heritage Lottery Fund needed to become engaged so that grants could be explored for heritage issues. There were serious challenges for the museum’s archives which were under pressure from both users and historians whose needs might be different.
  •  Had potential new income streams been identified for the Trust?
  • Was the valuation of the British Waterways property portfolio [£450 million] realistic?
  • What incentive was there for the Trust to change its governance in the future?

The responses were as follows.

Heritage: there was a museums representative on the Council, who would report on developments for museums and visitor attractions. The archives were regarded as a serious issue. They represented a major cost and storage and accessibility of paper archives was a problem but no less so for electronic archives which were still a significant cost. The Trust would continue to aim to make the archives available and it was an issue that needed to be settled for the future.

Income: at this stage the Trust’s long term commercial plans had to be subject to an element of confidentiality. But there was future potential for water cooling for buildings sited near the network, especially as many now had to make a 20% renewable energy contribution. In addition there were opportunities from micro power generation at weirs and locks.

Property Valuation: the property values were assessed annually according to the “Red Book” and this assessment is reviewed by Grant Thornton (the British Waterways auditors). It was regarded as a robust valuation.

Trust Governance: it was thought that the volunteer-led Trust would lend itself open to future evolution as necessary.

Close

The hearing closed with an offer from Richard Benyon to return to the Group to give a further report when the financial negotiations were concluded.

The offer was welcomed by the Group and it was thought that this future hearing was likely to take place early in the New Year.

Alun Michael closed the proceedings commenting that it was not unheard of for charities to go wrong, volunteer led or otherwise. It would not be an easy transition. It was going to be very challenging and there was profound interest from MPs on all sides of the House, and there was general support for the proposed model. The transition would be scrutinised with great interest.

The All Party Parliamentary Waterways Group Communique On The Future Of The Inland Waterways.

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