6 BRITISH WATERWAYS' COMMERCIAL
ACTIVITIES
70. British Waterways (BW) earned commercial income
is now its biggest source of revenue and is likely to remain so
in the future. In 2006-07, BW is expected to have a commercial
gross income of about £100 million.[118]
Figure 3 shows that about 34% of earned income in 2006-07 will
come from BW's property development activities, 22% from utility
sales, 19% from boat licence and mooring fees and 5% from joint
venture profits.
Figure 3: British Waterways' primary sources
of net income (commercial activity), 2006-07 forecast
Source: Ev 70 [British Waterways]
71. BW owns more than 1,700 properties worth a total
of £520 million.[119]
However, the 'In House Policy Consultancy's 2004-05 policy review
of BW stated that BW's core business was the "stewardship
of its waterways network".[120]
Some witnesses told us that a tension existed between BW's commercial
activities—particularly its interest in property development—and
stewardship of the network. Boater Simon Greer said BW was "more
interested in property development … and corporate survival
than it is after looking after boaters or canals".[121]
The Residential Boat Owners' Association said that BW's commercial
activity has resulted in it "taking its eye off the ball"
regarding stewardship of the network.[122]
72. Some witnesses were particularly concerned about
the type of waterside developments and business deals BW was involved
with. The Inland Waterways Association (IWA) said "unreasonable
financial pressures" were forcing BW into "inappropriate
dealings to over-commercialise the waterway network and asset-strip",
and expressed doubt about whether BW's partnership with Scottish
& Newcastle to develop a network of waterside pubs was suited
to the waterways environment.[123]
Boater John Keyes said that a lot of BW's developments were land-based
offices and housing that did "not reflect the character,
heritage or use of the waterways".[124]
73. When we questioned BW about some of these criticisms,
BW stressed that it was a waterways company and argued forcefully
that its property assets were "totally integral with the
development of the waterways".[125]
Its driver was the maintenance and preservation of its network,
and all its money was spent on this.[126]
Some witnesses supported BW's performance in this area: boater
Sir Adrian Stott believed it would be "improper" for
BW not to attempt to obtain the "best possible return from
its assets".[127]
Our views
74. British Waterways is under immense pressure to
generate income: income which ultimately funds the maintenance
of the waterways network. BW has a difficult task in striking
the right balance between its stewardship responsibilities and
its commercial activities, especially property development. We
note the concerns of many users of the waterways network that
BW has not currently got this balance right. We recommend that
BW develop an environmental heritage strategy for the waterways,
in tandem with the Waterways Trust. This should involve all interested
parties, and could be orchestrated through the British Waterways
Advisory Forum.
118 British Waterways, Strategic Options Review, May
2007, para 4.2 Back
119
British Waterways, Annual Report & Accounts 2005-06, p 24 Back
120
In House Policy Consultancy, Policy Review of British Waterways,
2004-05, p1. The In House Policy Consultancy is based in the Department
for Transport.It made recommendations agreed by the Review Steering
Group to Defra and Scottish Executive Ministers. Back
121
Ev 269, para 3 Back
122
Ev 310, para 12 Back
123
Ev 4, paras. 46 and 48 Back
124
Q 371 Back
125
Q 262 Back
126
Q 266 Back
127
Q 356 Back
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