Appalling financial performance
IT IS not only British Waterways appalling performance on visitor numbers that demands that its directors should not be running Canal & River Trust, but its financial performance is an even more compelling reason, writes Allan Richards.
The Evans/Hales partnership inherited a diminishing maintenance of backlog of some £187m and a commitment to eliminate the majority by 2012. This would put the waterways, for the first time ever, on a sustainable footing.
Self imposed task
They also undertook the self imposed task of reducing reliance on government funding. This was to be achieved by generating extra income particularly from the property portfolio. The so called 'assets for equity swap' dictated that they sell off property using the proceeds to invest in joint ventures which would then produce larger profits.
Indeed, British Waterways managed to convince government that they could do this as reflected in the oddly named 'strategic steer'. Its annual reports show reducing government grant became an objective shared by both Defra and British Waterways.
Ambition
The ambition was, by 2012, to have a largely self-sufficient waterway network used by twice as many people as in 2002. We have already seen how British Waterways has failed miserably on doubling visitor numbers, a measure that is of prime importance in demonstrating the public benefits waterways bring.
But did increased financial performance allow them to largely eradicate maintenance backlog and reduce dependence on grant?
The answer is no and no!Backlog
In a report in May 2007, British Waterways admitted that maintenance backlog had risen rather than fallen. It was up from £187m to about £200m. It is now spiralling out of control, and may be as much as a third of a billion pounds due to the rising funding gap. However, a request under the Freedom of Information Act which might confirm that figure remains unanswered, despite the involvement of the Information Commissioners Office.
Self sufficiency
Needless to say, British Waterways has missed every one of its self sufficiency targets, and need for grant is rising rather than falling as planned. As the graph shows, British Waterways planned for £45.3m of grant in 2010/11.
They took £58.9m, but that is only half the story because British Waterways' chief executive says that they really needed another £39m to cover the funding gap and a further £10m as expenditure exceeded income. In other words they planned for a grant of £45.3m but really needed £107.9m just to prevent further deterioration of the network.
They would have needed many millions more to make a sizeable dent in the maintenance backlog. How could they have got it so wrong!
All Party Parliamentary Waterways Group
British Waterways' monumental financial failure has not stopped its chief executive from trying to convince the All Party Parliamentary Waterways Group that British Waterways can increase its net income of a mediocre £61m in 2010/11 to £85m in 2014/15. Unsurprisingly, It was put to him that this figure might prove wildly optimistic!
Two failures
British Waterways only set two long term yearly targets, visitor numbers and self sufficiency. Its performance against both has been appalling.
The people who have voted in the narrowboatworld poll that Evans, Hales & Co should not remain in office when British Waterways becomes Canal & River Trust are right.