Funding cuts 'risking UK waterways'

The influential Environment, Food and Rural Affairs Select Committee voiced "extreme concern" about the scaling back in public finance for the maintenance of inland waterways.

In a new report, it also expressed dismay at poor relations between the Government and British Waterways, stemming partly from disputes over funding.

The committee said that British Waterways, which is responsible for 2,200 miles of rivers and canals, had already been placed under "considerable pressure" by a decline in Whitehall funding. Some £5.6 million of planned work to refurbish bridges, locks and aqueducts on the Grand Union Canal, the Leeds and Liverpool Canal and the Ribble Link was postponed because of a £7m shortfall in British Waterways' expected 2006/7 budget.

Users of the network have complained the impact is already apparent, with concerns about a growing number of emergency stoppages for boats, less dredging taking place on the River Severn and a decline in communications by British Waterways.

British Waterways believes that the downturn in funding could be disastrous if it is not rectified. "We are a £200 million turnover business, we are spending £20-£25 million on major works every year," it told the committee. "If for two years those have to be delayed, that cannot be said to be a disaster. What is a disaster is if those cuts are not reinstated and the grant continues thereafter."

The organisation expects a shortfall in funding from the Department of Environment, Food and Rural Affairs (Defra) of £35 million by 2011, which would affect major repair works and dredging.

But ministers insist that British Waterways will receive £30.1 million more income between 2002 and 2012 because of higher-than-expected commercial earnings over the period and grants up to 2007. The committee said: "We are extremely concerned at the implications of likely lower Defra grant levels in the Comprehensive Spending Review 2007 period, from 2008/9 to 2010/11, on British Waterways' ability to maintain the waterways network to an acceptable standard.

"British Waterways says a funding settlement in which its grant level reduced by 5% in real terms would result in a £35 million under-spend on major works by the end of the three CSR years alone, and the network would then not be "fully fit-for-purpose".

The committee called for the National Audit Office to review the conflicting claims about the state of British Waterways' finances and urged better relations between the agency and Defra. "British Waterways relies on Government for much of its funding, and therefore has a responsibility to ensure important business decisions and complex terms, concepts and models are explained clearly to its sponsor department," it said.