Budget Bonus for BW

...but is there a sting in the tail?

There was good news for British Waterways in the Chancellor's Pre-Budget Report this week.

As part of the Chancellor's measures to give a "fiscal stimulus" to the economy, a grant to BW of £5m will be brought forward from the planned 2011-12 budget. The money will be used as part of a £33m major works programme to repair a range of historic locks, bridges, embankments and reservoirs and dredge channels in waterways across England and Wales.

This shows an acknowledgement that Britain's historic waterways provide excellent value for money for the nation, generating in excess of £500m to the economy each year.

Bringing forward this chunk of cash means that vital work can be carried out sooner and, hopefully, the employment and commerce generated will do its bit towards helping to re-vitalise the economy.

However, it was also announced that, as part of the Operational Efficiency Programme, a team led by Gerry Grimstone will review British Waterways' model for managing its canal-side property portfolio and assess how best public value might be delivered from these assets.

This is causing alarm amongst many waterway enthusiasts, as they fear that the implication is that BW will be forced to sell off its property portfolio through a kind of "fire-sale" and might not even get any of the money!

The fact that a review has been announced doesn't necessarily mean that the assets will be sold off - although that is always one of the possible outcomes. One argument against selling off property at the moment is that it would not bring in sufficient money, with the current downturn in property prices.

Another outcome might be the placing of BW's property and investment operation into a new private sector company run by BW, separate from the public sector navigation operation, as recommended by the KPMG report.

Other points of view state that BW management is somewhat naive to imagine that they could build up a huge property portfolio to help finance its navigation operation, without that portfolio being eyed up and plundered by governments of one colour or another.

So what do you think? Will the extra cash now help? Will BW end up losing its property assets? What does it mean for the future of the waterways?

Add your comment now to have your say!