Committee for Infrastructure

OFFICIAL REPORT (Hansard)

Briefing by

19 October 2016 ASSEMBLY

Committee for Infrastructure

Briefing by Waterways Ireland

19 October 2016

Members present for all or part of the proceedings: Mr William Humphrey (Chairperson) Mr George Robinson (Deputy Chairperson) Ms Kellie Armstrong Mr Alex Easton Mr Paul Girvan Mr Declan McAleer Mr Fra McCann Mr Eamonn McCann Mr Justin McNulty Mrs Jenny Palmer

Witnesses: Mr Colin Brownsmith Waterways Ireland Ms Dawn Livingstone Waterways Ireland

The Chairperson (Mr Humphrey): I welcome Dawn Livingstone, the chief executive of Waterways Ireland, and Mr Colin Brownsmith, the director of finance and personnel. Is your other colleague joining us?

Ms Dawn Livingstone (Waterways Ireland): No, John Boyle sends his apologies.

The Chairperson (Mr Humphrey): That is fine. I will hand over to you, Dawn. You can provide us with a briefing and then Members will, no doubt, ask questions.

Ms Livingstone: Yes, and if there is something you want to ask as we go through, please do.

First of all, I welcome you all to our headquarters in Enniskillen. We are delighted to have you. This building is available for public use, so, if you need to use it in other aspects of your life, it is here and I draw your attention to that. We also make it available to voluntary organisations for use.

What is Waterways Ireland about? It is about delivering prosperity. I will give you a brief background on who we are and what we do and then take you through the key things that we are trying to deliver.

We are the largest of the six North/South bodies. We are headquartered here in Enniskillen, and we have three operational regions: a northern region, an eastern region and a western region. The western region is the Shannon navigation, the eastern region is the Royal, the Grand and the Barrow and the northern region is the Erne, which is outside, the Shannon-Erne, which is a 64 km that connects the Shannon and the Erne, and the lower Bann navigation.

1 What are we legally required to do? We are legally required to manage, maintain, develop and promote the inland navigable waterways, principally for recreational purposes. What do we manage? Everything that is dark blue on the map that I am showing you is part of the 1,000 km of navigation that we manage, develop and promote. We have 420 km of towpath. On the map, the two canals coming out of are the Royal and the Grand, and the line running down the east coast is the Barrow navigation. In total, we manage seven navigations, 175 loughs and chambers, 360 bridges, over 1,200 heritage structures and almost 14 km of public moorings. We provide the public infrastructure that allows boats and people to use the inland waterways for recreational purposes.

Our successes have included reopening the Royal canal which had been closed to navigation, 140 km of it. We have also successfully marketed and promoted the inland waterways. We are not just about infrastructure; we are about promoting the waterways and bringing people to them and increasing use. We have had things like the Lakeland Treasures app, we run a very active marketing and social media programme and we provide things like the navigation guides, which are the hardware that you need to use the waterways.

We have had a programme of infrastructure upgrade and restoration, and you can see some pictures of examples of where we have repaired and maintained towpaths and harbours. In the good times, we invested a significant amount of public money in providing world-class facilities on our inland navigations. Sometimes, we need to celebrate that. If you have travelled anywhere across Europe or, indeed, across the Americas or Canada, you will know that we have world-class facilities and waterways here.

The challenge is to manage and maintain what exists. As I said, there are 1,000 km of waterways; it is probably the largest public estate in the country. From the slide, you can see the complexity of our task, with 250 public amenity sites comprising harbours, slipways, picnic areas, car parks and amenity buildings, the thousands of kilometres of back drains, sluices and things that you do not see but which are required to manage waterways, particularly canals, and the 1,500 permanent aids to navigation. The navigation marks belong within our remit as well.

In terms of maintenance, there is little we do to manage waterway infrastructure that is cheap. Jobs tend to cost in the region of £100,000 or are in the hundreds of thousands. You can see here some routine work to the wall at Henesy's bridge on Grand canal. We also manage an estate that was largely built in the late 17th century and early 18th century, which extends across this navigation and the Shannon as well as the canals.

New challenges are things like invasive species. There is an ever-growing diversity of invasive species being found in our navigations, and this has changed the ecology. If you look at the Erne system, you will see that we had, first, zebra mussels that came from eastern Europe on boats. They cleared the water. The water here used to be turbid; you could not see through it. The clearing water provided by the zebra mussels has facilitated the growth of a very wide range of invasive species. We have a project in partnership with the University of Michigan and Queen's whereby a PhD student is doing some research so that we can understand the life cycle of these things, but they are coming at us more quickly than we can identify them at this stage. Another example is the Asian clams that occurred in Lanesborough and are now in the River Erne, downstream of Belturbet. Last year, we had a plague that affected crayfish. Again, this passed through our waterways in one season; it was first found on the Barrow and then here on the Erne. How we manage that going forward is very challenging for us, given that it has the potential to close the navigation.

We have also suffered from the impact of severe weather and flooding. The pictures you can see are from winter 2015, but we had a similar one-in-100-years event five years before that. A lot of our infrastructure was entirely washed out. When we repaired it, we moved all our electrical fittings and things up, but there is only a certain amount of flood-proofing that you can do. You can see in the bottom picture that Henry Street in Enniskillen was entirely under water. The other effect of flooding is the physical damage. The next picture shows a breach on the Lough Allen canal, where the ground became so saturated that the canal gave way and the bank collapsed. The bottom picture is of a jetty in Limerick.

How do we manage recreational use? We are essentially a recreational authority, and, while there are by-laws, 99% of our work is through education, encouragement and persuasion, as opposed to the use of by-laws, but they are there, and they are used. We are in the process of seeking to update the Lough Erne (Navigation) (Amendment) Bye-Laws (Northern Ireland) 1986. That had progressed under DCAL, and we will pick it up again under the Department for Infrastructure. We are also seeking to modernise the canal by-laws, which, again, have not been updated in over 26 years, and it

2 is the same for the Shannon navigation. What we are looking to address is the fact that a growing population of boat owners want to use public moorings as a private facility and not as a public provision whereby you are allowed to visit and move on. They want to use them as somewhere to leave their boat permanently. There is a good private marina infrastructure on the Erne, and, if we do not maintain the by-laws, we are undercutting that business. We need to address that.

I talked a wee bit about the ageing and historical estate. We did a critical structures report. The value of the assets under our management is over €1 billion. If you look at our critical structures report, which is about repairing only the structures that are in a critical condition and bringing them back into a maintained condition, you will see that the cost of that is about €6 million a year in the South, and it varies in the North. The most critical structure we own is Carnroe weir on the lower Bann, and we will be making proposals to the Department for Infrastructure to repair it in 2017, subject to funding being made available. In the bottom picture, you can see the damage to the weir where bits of it have just washed away. The loss of the weir would close navigation on the Bann. We are refining our estimates, having done further underwater studies, and it will cost somewhere between £650,000 and £1 million to fix. It sounds dreadful, but it is a once-in-75-years or a once-in-100-years expenditure, and, when it is done, it is done for the next generation or generations. This site is also important as it is the key fishing site for The Honourable The Irish Society, which has had a terrific year. We need to get in and repair that and allow its business to continue to flourish.

The next picture shows the work that we have been doing to Toome gates and to the lock chamber. We were fortunate in that we were given additional capital last year and were able to make the repair. Again, no one had seen the chamber empty in over 50 years. When we emptied it, we found that there were big holes in it. Sometimes, the repair work costs more. In addition, we were fortunate six years ago to be able to build a new workshop in Portna, which has allowed us to introduce in-house lock gate manufacture. We are now building and replacing our lock gates on the Bann and doing that with our own staff.

You can see the work that we are going to propose. We were very grateful to receive an additional £1 million in capital this year, and these are some of the projects that we are undertaking with that money. Rather than having had to close facilities because they had come to the end of their life and we could not patch them any further, this allows us to replace the moorings in Belleek. Also, you can see the work going on in Carrybridge. Again, this is an important site because there are quite a number of businesses around it that depend on water-borne custom.

I will put into context the money for the funding requirements going forward. Capital is funded by each jurisdiction, so we are currently funded at 15% by the North and 85% by the South, but capital is funded by the jurisdiction in which it is required. It is about €6 million a year in the South of Ireland to fix our budget, and you can see here that the allocation that has been indicated over the next three years is €2,680,000. This year, we were successful in receiving additional funding of €3 million. In the North, with the extra £1 million, our budget requirement is £1,075,000. This is helping to redress some of the underfunding in previous years. The funding in our budget before we received the additional money is £75,000, and that is what has been indicated for each of the next three years. The actual requirement is probably around £1 million in 2017, and then it drops to an average of around £450,000 going forward.

The current budget for 2016 is €23·68 million, €20 million of which is funded by the South and £2·5 million by the North. With the exchange rate that is fixed each year by the Department of Finance, that equates to €3·56 million. We have 285 full-time staff, which has been reduced from 381 staff as our budget has been declining from 2010. Of our current budget of €23·68 million, payroll and pension costs account for €16·9 million. That leaves us with €6·78 million. Overheads are €3 million, and we have reduced those by 40% over the last three years. When you take into account the cost of the exchange rate, this year it comes to just €970,000. That leaves us €2·81 million to run 1,000 kilometres of navigation. That is the element of discretionary spend.

In looking particularly at Northern Ireland funding, I want to illustrate how the exchange rate has affected the actual value of the Northern grant. I will stand up to show you this on the screen. I want you to focus on this line. This is 2010, and the exchange rate —

The Chairperson (Mr Humphrey): Dawn, I do not mean to interrupt you, but, if you stand up, the microphone will not pick you up. Sorry about that.

Ms Livingstone: I will have to sit. The top row shows that the rate of exchange in 2010 was 89 pence to one euro. The chart tracks this through to 2016, when it is 70 pence. The chart shows that the

3 value of our grant from DCAL in 2010 was £5·14 million, in round figures, and that in 2016 it was £2·521 million. The actual decrease in the budget is 51%. We were to take agreed reductions in budget of 3% a year for the first three years and 4% for the next four years, but our budget has declined by 51% because of the combination of efficiency savings and movements in the exchange rate.

Waterways Ireland has had the perfect storm regarding pressures. We have had reduced budgets that were in excess of the agreed reductions. We have had losses due to the exchange rate, and we are also in a unique position with our pension costs. When Waterways Ireland was formed, it had 223 staff transferred and designated into the organisation. Eleven of those staff came from the North, and the balance came from Office of Public Works and one of the sponsor Departments in the South. The people came into the organisation in the third and fourth quarters of their working careers, and Waterways Ireland is now paying, from its budget, all of the pension costs associated with the retirements of these people. A mature organisation will have a budget of, say, a million and it will hover around a million because people will come on and people will also drop off. We do not have that curve, and you can see here how pension costs are going to continue to erode the actual money available to deliver inland navigations and prosperity. Pension costs have come from nothing to £2·4 million this year.

So, what have we been doing? We are trying to develop the delivery model. We are trying to refine how we operate, become more efficient, look at what we are doing and how we can manage with these vastly reduced resources. We have recognised that we are a seasonal business, but we are also a government body so our flexibility is somewhat limited. However, as people have retired, and where it is appropriate, we have moved to seasonality. We have recognised that we are very busy from March to October. Outside that, some jobs can be delivered seasonally. We have had a review with our lock-keepers where we have tried to refine when we are providing services to the areas that are the busiest, so that we are getting better value for money. We are in the middle of a plant and machinery review. We cannot afford to buy plant, so we are having to look at how we provide and maintain it. We are doing that against the backdrop that how the navigations have been run has changed over the last 15 years. We have mechanical, electrical and pumping systems that did not exist 15 years ago. We are also in the process of a review to see how we run and manage our stores. We do not have the ability to have any form of compulsory redundancy in the South, so we have to take opportunities when people retire to decide how can we move people around and be more efficient. We have changed our senior management structure, which had five directors and now has three. At the moment we have a fourth which we hope to appoint. We have slimmed down our senior posts, and we are also focusing on our core skill areas.

What are the key things we do, and need to do, and what can we lose at the edges? How can we build up volunteering and create the same sort of levels of service in a different way? Sometimes, we need to remind ourselves that we have world-class waterway corridors, and we undersell what we have. We are continuing development. While we do not have any money ourselves, we have not sat about and said, "Oh well, we have no money, we will just spend what we have on critical infrastructure repair". We have had a very active programme to lever in third-party funding to carry on development, and that has largely been focused around upgrading the towpaths.

The canals are publicly owned recreational corridors that stretch across the country and can connect with cycle paths here in the North. Here you can see some of the money that we have levered in from third parties, most recently €2.5 million from the Department of Transport, Tourism and Sport in the South, for towpath enhancement and upgrade. We have 80% of the Royal canal completed at this point, and I will talk at the end about the greenway. We have created inward investment where we have not got money. By working with local authorities and through the planning levy, we have been able to get things like harbours and new places to stop created or canals widened.

Going forward, our vision is for vibrant, living waterways packed with people using them — local people and visitors — and creating jobs and health opportunities that make a real contribution to all the communities they pass through.

One of the elements we promote is sports tourism, and this year we hosted the European wakeboard championships on the Lower Bann. We have been offered the world championships in two years' time. To put that event into context, it brought 220 people in for 10 days. We have just finished the fourth year of three weeks of fishing competitions that has brought over £350,000 of income into this area in a shoulder season. How are we doing that? The actual money we put in was €5,000, but more importantly we have used our men on the Erne and our wardens to ferry people to the islands for the fishing competitions. A lot of it you do not see in money, but you do see in support.

4 Our sponsorship programme is worth about €8 million per year, and we spend €175,000. We are about increasing participation, and we want to run programmes that move people from coming to "try it" sessions. We want to do things with partner organisations that create a step change in local people actually using their navigations. This summer, one of these was the Blueway 10K approach, a project funded by the Coca-Cola community fund, and we were in partnership with the Irish Canoe Union and the Canoe Association of Northern Ireland (CANI), and we had 63 locations where people could come along and take part in a 12-week programme and learn how to canoe, and it culminated in seven places with a Blueway 10K event. It is like couch-to-5k for running — this was couch-to-10k for canoeing. We are trying to make a step change so that another 700 people become canoeists, and we are looking at how we can build that and open-water swimming. The difficulty is in getting local people to take up a sport and participate.

There are new markets and opportunities. If you had talked to us five years ago, we were about boats and navigation; now, we recognise that we are about recreation opportunities on the water. People are walking, cycling, paddling or stand-up paddleboarding in a way that they have never participated in those activities before, and it brings opportunities. We now have businesses located at our public moorings here at the front; we have a private high-speed boat tour company; we have Row the Erne, a community-based organisation; and we have just supported — on the back of one of our jetties — Bann Boat Hire, and there is one here in Enniskillen, where the boats are only able to use the outside of the jetty for water depth and where we are able to shelter a hire boat company on the inside of the jetty. It is about creating opportunities and jobs. You can see folk here on one of our blueways.

We have an education programme, and we have just completed a programme here in our headquarters learning about the ecology, which was a partnership with Inland Fisheries and the local education authorities. It is all about trying to build up participation by young people and instil a sense of ownership of the waterways. Ultimately, we want the school curriculum to include knowledge of the waterways in the area, just as the Mournes are part of the curriculum. We will be creating something that is there permanently, giving children knowledge of and, hopefully, affection for the waterways. We want to bring the environment and heritage value to life. It costs us an enormous amount of money to deal with the very highly designated waterways that we manage, but that is what makes them special; that is the other side. Our heritage plan is about celebrating it and increasing the value. We have a small community grants programme of €20,000 which has fostered 19 projects this year, allowing local communities to engage with the waterways heritage, celebrate and preserve it. They bring it to the attention of visitors in a way that we just cannot afford to do.

In short, we want to transform the quality of life and reinvigorate local communities. For many of the towns and villages that our waterways pass through, that waterway is their opportunity and we need to work it and bring people to it. One of the ways in which we are doing that is through our blueways. This is not something that we invented, it started first in Canada. A blueway is a trail that is on or beside a waterway — we have some promotional material on it here — and it is about presenting the waterway to people who do not own a boat so they can still come and use it. You can come and walk in the area, cycle in it, and it is about putting together a product that involves very little additional capital infrastructure, because we already have the product. It might need a bit of tweaking, with signage and canoe steps, but, by and large, it is about packaging and selling what we already have. We launched the first one on the Lough Allen canal in October 2014 and it brought 100,000 visitors to the area this year. We chose the Lough Allen canal, and Drumshanbo and other villages around it, because it was an underused waterway. It was very beautiful, but nobody went to it and the number of boat users was very low. We launched the second one on the Shannon-Erne blueway, which runs into the Erne here. The Erne Water Taxi is here too, based at our jetty. Another company that formed as a direct result of the off-road tow path facility is Electric Bike Trails; it has now extended to three locations.

We commissioned research at the end of last year and start of this year with Fáilte Ireland on the economic and social context potential. It was overseas research on the key markets and it found that the approximate number of adults who were definitely interested in using a blueway for a holiday or short break was 20·9 million. If we capture just 5% of that market annually, that would represent an additional 1·05 million visitors, and the Irish economy would benefit by approximately €1 billion per annum. This is huge potential and we have the product: we need to put it together and sell it in a focused manner. We also work with Fáilte Ireland on Ireland's ancient east, which takes in the Shannon navigation, where we are looking at Ireland's mystical highway. Again, it is about how we re- present what we have and build on the context of the opportunities to celebrate the heritage and culture to bring overseas visitors. From that research, we know that this is one of the key drivers in attracting someone who is sitting at home in America trying to decide whether to holiday in America or Europe this year to come to Ireland. The relevance for us in the North is that the waterway connects

5 into the Erne. The Erne has a fabulous heritage. It has Devenish, the Janus stone and Boa Island. We just need to work on our access, package it and bring people to explore it.

Another element of our work is an action plan for Grand canal dock and Spencer dock. We own the two docks in Dublin. Grand canal dock is the largest dock in any European city. We want to turn them into destinations in the city of Dublin in their own right. We see them as the outdoor blue playground. My hope is that, in five years' time, when you go to Dublin and think, "I must go to O'Connell Street", you will then think, "I must go to the docks and see what is going on in that animated space". It will be that sort of attractor. They are key to linking the city and its use to the wider canal network. People should not just see the canal as the bit beside them but understand that there is the potential to go across to the west and make a journey.

We own City Block 19, which is 2·2 hectares, and we are in negotiations with NAMA to bring it forward for development. Our goals are to sustain a significant income to support operating the canals and the inland waterways, realise community potential in the site, have sufficient investment to reopen the lock gates, open the dock up so that boats can come in from the Liffey and the sea and repair the final dock walls, which are still leaking.

We are about earning income; we are looking at our estate and asking how we can create a sustainable income for each of the waterways so that, going forward, as government money becomes more constrained, we can enhance and support their operation. One of the things that we are doing is actively licensing the use of the tow paths to carry dark-fibre or high-speed telecommunications. We are also in the process of selling airspace, where we own valuable property in the city. If your property overhangs ours, we will commercially sell that to you.

I will give another example before we leave income. We do not have the linear opportunities here on Lough Erne or on the Shannon, but we recommend that government look at charging. Navigations are free for boats to use, and there are 6,000 registered boats on the Erne. At the minute, registration is free, but if even a small charge were levied, it would have a significant impact on the money available to run the navigation. There are 8,000 boats on the Shannon navigation. It is common practice across Europe to charge for use of waterways.

I have moved now to the slide, 'Ulster Canal: Lough Erne to Castle Saunderson'. This is an initiative by Minister Humphreys and Minister Hazzard and has three phases. Phases one and two are complete. We are about to go to tender for the final phase. That opens up navigation to Castle Saunderson, where there is an international scout village and Cavan County Council owns an additional 60 acres. The total cost is €4·6 million.

We were tasked last June by the North/South Ministerial Council to look at whether we could draw together a consortium of interested parties and create a greenway along the route of the Ulster canal. A greenway has a number of advantages in that, for a relatively modest economic cost, you can preserve the route of the canal and create an immediate recreational and economic benefit. We have put together that consortium. The total length would be 76 km. There are 4·2 km already in place completed by Monaghan County Council, which has been a key partner. The total cost to complete the whole 76 km is £14·6 million in round figures. We have bid to the INTERREG V programme under sustainable transport to enhance 22 km at a cost of €4·9 million. That is in progress.

You can see here how the Ulster canal fits into the overall proposals for an off-road, cycling network in Northern Ireland and how they would connect across. The line goes up through Monaghan to connect with the route coming from Omagh. Then, if the Lagan tow path came out of , there would be connectivity with your city.

The final slide is about value or what the inland navigations are worth. Annually, private boating contributes €88 million. Business in the cruise hire sector was up by 17% last year and 12% this year, and the two groups that own most of the chartered fleets across Europe have just ordered another 250,000 hire boats for delivery into the system over the next five years. That is worth €50 million. Angling is worth €142 million annually. The access to recreational opportunities — canoeing and other softer activities — is worth €50 million. What are the health benefits? What is this worth as measured by people's better health from using the navigations? It is worth €30 million. Events brings in €8 million. The good status of the water quality is about what people would pay to enjoy that. That is how that has been estimated. It is valued at €16 million. Overall, it is €384 million annually.

That is a bit of a whistle-stop tour, but I am conscious that your time is limited. Colin and I are happy to take questions.

6 The Chairperson (Mr Humphrey): Thank you very much. Recreation is hugely important. Obviously, it is very important to Fermanagh in terms of the scenery here, water activities and fishing. How are we progressing with getting a joined-up approach between Tourism Northern Ireland, you and Tourism Ireland to market this place nationally and internationally?

Ms Livingstone: We work very closely with Tourism Ireland on our Southern side. The development manager for the lakelands from Tourism NI is based in our offices. We have offered office accommodation because we obviously see the synergy in that partnership and the need to work together. We will meet the chief executive and the directors of Tourism NI this Friday to look at how we can come together to promote this blueway product and how that fits into the whole lakeland destination. We need the Tourism NI strategy to come out; that is how we tie back in to Tourism Ireland, which is one of our sister North/South bodies.

The Chairperson (Mr Humphrey): I welcome the fact that Tourism Northern Ireland is housed in this building. That is good progress. That "joined-upness" is to be welcomed.

Your budget reductions are fairly serious, given the economic climate in either jurisdiction. Has there been any improvement in the relationship between you and the new Fermanagh and Omagh council, and the other councils surrounding this area in the Irish Republic, in terms of councils putting more money on the table instead of national or regional government?

Ms Livingstone: We work very closely with Fermanagh and Omagh District Council. We are doing a piece of work with it and Forest Service which is looking at the whole public estate here in the county and how we can all better join up what we do. We have the geopark and Lough Navar in Forest Service. It borders the waterways. How do we come together and get that overarching picture of the outdoor recreation opportunity in the county? In terms of additional funding, we work with the councils to look to lever third-party funding — we have European bids with them — but they seem to be as pressed for funding as we are.

The Chairperson (Mr Humphrey): I do not want to labour this, but —

Ms Livingstone: The other thing I should say is that we have a partnership with the council, which we have had for years. We share the management of the sites; it does the land side and we do the water side. You do not see money changing hands, but there is tangible cooperation in terms of trying to deliver the service.

The Chairperson (Mr Humphrey): As I said, I do not want to labour this, but, obviously, this part of Northern Ireland hugely benefits from and is able to attract tourists. When other parts were not attracting tourists, they were coming to this part for reasons that are unique to it. That is hugely important.

The economies of scale of these new councils should mean that they are in a position to bring more money to the table in terms of tourism than perhaps the two councils that merged to form the new council were in a position to. To be honest, Belfast City Council has been doing something very similar for years. I just make that point.

Ms Livingstone: We are mindful that economic development is now part of the council's remit. We have worked with it in developing the tourism strategy for the area. We have been able to demonstrate ways in which we can work cooperatively together to get economic development activated and successful. While we provided the inside of the jetty for the small boat hire, the council gave the on-land facility out of a piece of its ground. I am certainly not aware of it having additional money becoming available — we hope that that will be the situation in the future — but sometimes we need to just be very creative with what we have.

Ms Armstrong: Thank you very much for your presentation, Dawn. Coming from the Strangford lough area, I am very jealous of the work that has been done here; I wish that other waterways would take on that type of development activities. There are a few things that you mentioned, and I hope you do not mind if I revisit them. You mentioned the £650,000 to £1 million estimated cost of the work that needs to be completed at Carnroe Weir. Given that we know that budgets are going to be quite tight and that there is a one-year budget coming forward, have you guys already put forward the proposals for consideration within the capital budget?

7 Ms Livingstone: We have certainly discussed it with Department of Infrastructure officials; we have been flagging it since our first meeting. We have been delighted to get additional money in-year, but this is a project that, because of the third-party interests and the fact that you have the whole of pouring across this weir, there is only a window of opportunity to do it. It is not a project that we will be able to deliver if somebody finds money in July, because we are going to have to ask The Honourable The Irish Society to not sell their fishing permits, because there cannot be fishing when we are working in the weir. So it is one that will have to be given priority and funded and done. As I said, once it is done, it is done for another 100 years. While I can lever money for development, I cannot lever money for the core cost of maintaining that public infrastructure.

Ms Armstrong: There is a revenue budget for one year, but the capital budget will be for four years. As budgets are very tight and there are certain requirements that the Department might want to prioritise, if it does not happen, what will be the impact? Is there any other form of funding that could come in for something like that?

Ms Livingstone: I am not aware of another form of funding being available for that core infrastructure investment. As I said, we have and do lever LEADER, regional development strategy (REDS) funding and European money, but that is for core investment. I am not aware of another source. It is a complex project, because there is an enormous set-up cost. You have to dam off the river, so you do not want to be doing that over a couple of seasons. It has not been done for a number of years and the weir has continued to deteriorate, so if it is not done now the cost will keep going up.

Ms Armstrong: On slide 19, you talk about the critical structures repairs to prevent further deterioration. There is a significant drop in the predicted budget required between 2017 and 2018, from £1 million to £465,000. Why is that drop there?

Ms Livingstone: Because that is what we estimate we will need. We are not proposing that everything should be Rolls-Royce. We have fixed and repaired jetties. For example, we put new jetties at the shopping centre — this is one of the few places that you can come to by boat to do your shopping — but the engineer took old units that a contractor had and refurbished them for £14,000. If we were buying those new, they would be £140,000. So we have tried to be very creative, and we are only looking for the money to repair what is absolutely essential.

Ms Armstrong: OK. It is such a significant drop that I wondered —

Ms Livingstone: Carnroe Weir is a huge project. The only cautionary note I have on that is that, because of insufficient money, we have dropped back our underwater inspections. We would have done them every five years, but now we are up to seven and a half years, and we are no longer meeting that. There is always the potential that you will under-inspect something like canal walls in Toome and find out you have got a massive problem. That is what we think at this point in time, but it is not going to be a huge quantum. It might be another £200,000, but it is very modest investment for what you get. You have 6,000 boats here on the Erne, which creates £29 million every year.

Ms Armstrong: You talked about the potential 20·9 million tourists, which is an incredible figure. The Northern Ireland Tourist Board is involved with you, and obviously Center Parcs is coming to Longford in the near future.

Ms Livingstone: It will be on the Royal canal.

Ms Armstrong: That is what I was thinking. Are you already in with those people, talking about the potential to link through?

Ms Livingstone: Oh yes. Part of the planning conditions for Center Parcs was that the Royal canal towpath would be upgraded. As you know, when you go to Center Parcs, you park your car and you cycle. Center Parcs was very keen that you could get there on your bike. It is just connecting all of this together.

Ms Armstrong: I am very interested to make sure that Northern Ireland gets benefit out of that too.

Ms Livingstone: We have to get the connection through.

8 Ms Armstrong: Thank you very much.

Mrs Palmer: Thanks, Dawn, that was a very comprehensive presentation, I have to say. Kellie has just used one of my questions. In building these tourist links, what are the connections to Waterways Ireland and social economy businesses along that 1,000 kilometres? How many of the communities actually volunteer? In fact, how many volunteers are there in Waterways Ireland?

Ms Livingstone: The volunteers tend not to be ours. They tend to be organisations we work with. There is the Royal canal amenity group and the Grand canal clean-up group. Marks and Spencer staff regularly volunteer, and we support that activity. We have an engineer and a technician on each of the navigations. That sounds like a lot, but they are covering maybe 70 kilometres. That is the contact at a local level, or the contact is with the lock-keeper; and that is how we have the community contact.

TidyTowns and villages is an enormously beneficial programme. We work very closely with that cohort of people, and we have harbours and facilities which they look after entirely. Again, we support them. We might come in and help if they needed something regraded in terms of topsoil, but they paint, mow and plant, because it is part of their community. However, it is the thing that is attracting people to come in and use their shops and restaurants.

Mrs Palmer: Moving on to the synergy between yourselves and others, we have aspirations to open the waterways from Belfast right through to the Atlantic Ocean, basically, linking all the canal structures to you, including the Ulster canal and the , bridging that gap. I know that it is a difficult one for the likes of the Lagan Navigation Trust. Do you work with the Lagan Navigation Trust and share in its aspirations for linkages that would open up that whole waterway to tourism, social economy and community business right through?

Ms Livingstone: We certainly know Brenda very well, and we work with her. We have provided technical assistance in the past, where she has been doing feasibility studies. We are working with her at the moment in developing something called a waterways school, where there would be a partnership that would encourage people to come and work on the canals and waterways and build up skills. We are involved in fairly detailed discussions, and we will be her Southern partner, because we are in both jurisdictions. We are hoping to access some of the LEADER coordination money. That is a project in development.

Mrs Palmer: Good. Thank you. I have just one last question, Chair, before we move on. You talk about NITB and the INTERREG projects. Obviously, in the past, we bid for a handsome sum from INTERREG for the greater Belfast area, Lisburn and Craigavon to try to develop the works between Belfast and Lough Neagh. We were unsuccessful as a result of a report from NITB which said that opening the waterways across the island to the Atlantic Ocean was not one of its strategic projects, and so the bid failed. I am more hopeful now that, in this INTERREG project, the new tourism links will probably enhance the bid.

Ms Livingstone: I think I should be clear. The INTERREG bid is under the sustainable transport measure, which —

Mrs Palmer: I know, for the towpaths, but I am just saying that —

Ms Livingstone: I suppose that preserving the route and delivering a greenway or blueway along it — whatever you want to call that off-road opportunity for recreation — provides, for a relatively modest investment, a lot of benefit.

Mrs Palmer: Yes. It does, and I agree, but I see that there is more potential now, and more encouragement from Tourism Northern Ireland and Tourism Ireland.

Ms Livingstone: I think that, as an island, we have to be very mindful that we have two fabulous open-water navigations: the Shannon and the Erne. They are available and can be much more widely used by people in boats. Canal navigation, by its nature, requires boats of less draft and narrower beam, and canals can make for quite an arduous journey. We have 144 sets of locks. So, in Ireland, boating will always be competing. It is a different product, an entirely different experience. We have a huge weight of numbers on both of those big navigations, but a smaller number of boats on the canals. Their benefit is really as linear recreation corridors which are in public ownership.

9 Mrs Palmer: It is so much fun, Chair. I have been on Lough Allen. I have taken boats from Leitrim right through. I have even navigated the boats. John said that it is a very arduous thing to let a woman at the helm of a boat. There is such a big opportunity across the whole of the island. I wish you every success, and I hope that the finances are met within this term.

Mr F McCann: Thank you for the presentation. It was very interesting, certainly for somebody who comes from inner-city Belfast. I remember, as William would remember, the whole argument and debate about the connectivity of the Lagan, right through Lisburn and onwards. When you listen to the presentations, it suddenly grips you. Listening to your presentation, it is clear that the potential that is there for what is probably one of the key planks in everybody's economy now, tourism, is endless. Sometimes, we take a very short-sighted approach to saving money through short-term gains which have a long-term impact on the product that you are trying to sell. I think that sometimes we need to get real on how we look at things like that. A friend took out a boat and did the waterways. He said that it changed his whole holiday experience for life, because it opened up new avenues and new ways to holiday. That is a big potential market. Friends who fish talk highly of fishing in Fermanagh, on the Shannon and places like that. The potential is endless.

How much is spent on trying to deal with the invasive species? Are there any cuts? We hear quite constantly about different species of plants coming in and having a huge impact on local flora and animals. If your budgets are being cut, surely that will have an impact on your ability to be able to deal with that and the impact that it may have on the infrastructure.

Ms Livingstone: The amount that we spend varies. Part of the difficulty is that when it grows to a certain extent, we try to cut it, but it is like trying to pull your hair out with a set of tweezers: it is not the answer. We could never do it. If the right invasive weed comes, it will grow feet every day and we will be unable to manage it. There has been an experience on Lough Corrib, where an invasive weed got in there and closed it. It cost €3·5 million to clean it up. They now spend €350,000 annually keeping it clear. To put that into context, that is the entire budget for the Erne here.

We had put together a biosecure LIFE bid, particularly to look at how invasive species are being moved around on boats, to improve that biosecure protocol and people's knowledge, and also particularly to study what is going on here on the upper lake, because you cannot begin to get a solution if you do not actually know what you are dealing with — if you do not know how it spreads, when it fruits, how it multiplies and what eats it. Unfortunately, we could not attract the match funding of €400,000 — €100,000 a year over the four years — from the Northern Ireland Environment Agency here in the North because it, too, has funding pressures, and this was not a priority for it. Protection of the biodiversity in the upper lake is its responsibility. My interest is navigation. I am just trying to get ahead, keep it open and not have a crisis. That was disappointing, because we lost that opportunity for €2 million of European money. At the minute, we go from season to season. We manage it as best we can. My concern is that we are not actually working sufficiently to get on top of it before it becomes out of hand, and then we will lose a major plank of probably one of our prettiest navigations, the upper lake.

Mr F McCann: Thank you for that. The other thing the Chair raised was the amalgamation of councils. What has happened is that the huge rate base that it now controls — and I know that Belfast probably has an advantage because of its city status. It was able to direct funds into tourism, the economy, infrastructure, regeneration and things like that — substantial amounts of money. I know that you are already saying that there is a partnership that exists there and that sometimes the council provides in kind. It would have a cost for them, but it is certainly an avenue that probably needs to be looked at, on both sides of the border. There could be huge potential there in building that partnership, because it works for everybody.

Ms Livingstone: We have had a lot of support from Fermanagh and Omagh District Council, and we have very active partnerships with local authorities in the South, where we have co-funded projects and worked together on LEADER delivery because we could not access it. I do not think it will solve our core funding issue. I am looking for each jurisdiction to take the cost of the pension and not ask us to meet it out of our budget. We asked the Northern jurisdiction to give us an additional £400,000 of core funding, as their 15% contribution. We have tried to be very mindful of how difficult money is but, as you said, sometimes we lose the bigger picture and the prize. It is a relatively modest investment for a huge potential benefit. Mr McAleer: Thank you very much for that very comprehensive presentation. Looking at the map of the navigation pathways, it seems obvious that the missing link is from the Shannon-Erne right down to Lough Neagh. In that scenario, that will open up the whole system to the North. Five of the six

10 counties border Lough Neagh. What is your assessment of the importance of getting that connection to Lough Neagh for the tourism potential, recreation and economic, in the North and overall?

Ms Livingstone: If we could create off-road connectivity for walking and cycling, that is hugely immediately economically beneficial. With regard to the money, we have costed it, and to get the Ulster canal towpath along the way is something like £20 million. If our INTERREG bid is successful, you are down to £14 million, which is still a lot of money, but, if you were going to reopen the canal, you are probably talking £350 million. We have 1,000 kilometres of navigation, and we have a lot of work to do to make that busy.

Mr McAleer: Do you think that there will be a lot of potential for the North? To give an example, I do not live too far from here, but many people have taken two hours to get here today, so this is probably the closest they will be to the Shannon-Erne waterway, but, if Lough Neagh was open, there would be much more potential.

Ms Livingstone: Lough Neagh does not have a navigation authority. There was work going on in DCAL, looking at a community partnership approach to how Lough Neagh could maybe be owned and managed going forward. Certainly, as a navigation authority for the whole country, we would be willing to play our part in that. It is outside our legal jurisdiction at the minute.

Mr McAleer: Thank you for the presentation. It was very interesting.

Mr Girvan: Thank you for your presentation. Being a bit of a bean counter, I am just interested in the pension balloon and the problem that you have and how you are funding that from a revenue perspective. I see that it will continue to grow to where, potentially, it takes up quite a bit of your running revenue because of the way it is set up and funded. What link is there between what happens in Northern Ireland and what happens in the Republic? It is maybe the age of the organisation that has created part of the problem.

Ms Livingstone: It is to do with the age of the organisation and with the fact that we got all these people transferred in. They have paid 25 or 30 years of contributions in some other part of the public service, but I am now paying for all of their pension costs out of our current grant. You can see how the graph grows. When we were set up, our budget did not include an element for pensions, but you can see that we will pay out €2·3-something million this year in pensions. Before anything else happens, that is the first call on the money, and it will continue to rise.

Obviously, this has been the subject of much debate between me, the sponsor Departments and the Departments of Finance. Last year, we got additional money to meet the increasing pension cost in 2015. It was almost €400,000. I had understood that that would be the position going forward, but I have now been advised in writing that we will continue to meet increasing pension costs out of the grant that we are awarded each year. If that grant remains at a level, our funding will continue to decline. We are at a tipping point. We have gone to seasonality, and we have not replaced staff. There comes a point when you have to start to close services.

Mr Girvan: I want to investigate a little further the point about those who have been transferred from other parts of the public sector. Why was the pension pot not transferred along with them to allow you to have a pot of money to fund it? Why is central government not seeing that? The long-term viability of this organisation is dependent on whether or not this hole can be plugged.

Ms Livingstone: We collect €650,000 annually in contributions from our employees and give that back to the Department. It is unsustainable. If a resolution is not found to the pension payments in this organisation, we will become a pension payment organisation.

Mr Girvan: British Home Stores sounds familiar. That is the negative, and we need to ask some questions to the Department of Finance about this matter from a Northern Ireland perspective.

Ms Livingstone: We were trying to be realistic. Money is very difficult and we said, "We have absorbed the €2 million up to 2015. We do not expect somebody to give us the €2 million back". From that point, if we could have got the increases, at least there would be some measure of being able to maintain a service and move forward.

Mr Girvan: You mentioned the 40% savings that had been made.

11 Ms Livingstone: For fixed overheads, yes.

Mr Girvan: What was included in that? Did it include staff reduction?

Ms Livingstone: No, it was things like closing offices and depots. We have renegotiated contracts, even the pension administrator contract. We re-tendered for the North/South bodies last year and our element of that saving was €35,000. We have been through everything with a fine-tooth comb. Colin is leading a project at the minute to try to remove postage. We have turned ourselves upside down and shook our pockets.

Mr Colin Brownsmith (Waterways Ireland): We do not use ordinary telephones anymore. We entirely use our computer network, so we have saved all the costs of telephones. There has been a lot of small savings.

Mr Girvan: They all add up. I appreciate that.

I will move off the negative aspect of it. I have a very keen interest in fishing and am involved in river trusts and suchlike. We have run into major difficulty with invasive species such as Japanese knotweed. The other one is probably hogweed, which is quite dangerous, and people are not aware of what can happen if they handle it. Young people think that they are playing with these things. It probably can be good to play with for a period until the effect is that these massive welts come out on you. Why do we not deal with some of those, including the Asian clam? Some people say that the zebra mussel is probably one as well. Some people say that there are benefits from some aspects of it, but it has the potential to destroy the infrastructure and effectively close our waterways if we do not address that. By not investing, we could be walking away from a major asset.

Ms Livingstone: I do not disagree with that. Because of my interest in the navigation, we put together a bid to the Irish biosecure LIFE fund. There is a fund there of €6 million, but I could not raise the match funding in the North. I could not get anybody to give it to me. I do not have the money, so the bid could not proceed.

Mr Girvan: I am looking at this from a council perspective, as was mentioned by the Chair. Councils now have the potential to draw down capital funding and borrow money at very competitive rates that can be used for what I would call capital projects. That would probably be an economic argument that could be put forward. There is the potential for something such as this to be put forward to a central local government group like the Northern Ireland Local Government Association (NILGA) to be prioritised.

The benefit from it is not for just Fermanagh and Omagh. I see the Northern Ireland economy benefiting greatly, so it affects the whole of the Province. If you drop a bottle in, it is going to spread out and ripple right through the whole economy. Some people say debt is not always good, but sometimes debt can be a stitch in time to save nine by investing to take on some of these not nice things, such as dealing with invasive species. That might be an investment for the long term.

The Chairperson (Mr Humphrey): I think that is a statement and not a question. I take it that you have exhausted your questions now, Mr Girvan.

Mr E McCann: I apologise for being late. I was struck by the references to Lough Neagh and the fact that there is no single navigation authority for Lough Neagh. In fact, there is no authority —

Ms Livingstone: No, there is no authority.

Mr E McCann: — on Lough Neagh. The sand and gravel extraction, which is very important, is controlled by one agency. The fishing rights are controlled by this Department ultimately and the Fishermen's Co-operative Society. As to who owns the shoreline, I think it is the Shaftesbury estate. That comes under this Department, that is the point that I am making.

I have been involved in the fishing issue there, and the Department that you go to is the Department for Infrastructure, which funds the Lough Neagh Fishermen's Co-operative Society. I am really asking this question to bring this issue to everybody else's attention. There is a campaign, and the Earl of Shaftesbury cannot answer the question: do you own the water in Lough Neagh if you own the fishing rights? We do not know. There is a lot of confusion.

12 Would it not help if there was a single authority responsible for the development and protection of Lough Neagh? We seem to be far from that position at the moment. As far as I know, there are no plans for one.

The Chairperson (Mr Humphrey): Obviously, Dawn cannot answer about Lough Neagh, although I absolutely sympathise with your point about Lough Neagh. I was on the CAL Committee in the previous mandate, and we had a meeting with both sets of protagonists in the dispute — if we can call it that — in front of the Committee. I am not sure that Lough Neagh comes under our —

Ms Livingstone: It is not one of the waterways we have any jurisdiction over.

The Chairperson (Mr Humphrey): I have absolute sympathy, Mr McCann, with what you are saying, but I do not think it is fair to ask Dawn to answer that. Some sort of regulatory or navigation authority there would be helpful, but it is not our responsibility. That is the difficulty.

Mr E McCann: I have one very brief question of a broad nature. I have travelled only once on the waterways. However, I have a brother who lives on a barge, or houseboat; I do not which it is. He sold his house in London and bought a barge. He had a lot of money left over, and he and his partner are now retired and spend their time there. It is an absolutely wonderful way to live.

The thing that struck me — and I am just asking you how much travelling on a canal is promoted — is how the world and time slow down. That was the thing that I took out of it most. You travel only a short distance, relative to cars and so forth, in a day. That is a wonderful way to travel. We live in a time when life is speeding up and there is great pressure on people to do things quickly. There is great potential for leisure in this, something like, "Slow down, it's calm on the canals" or whatever the slogan might be. Is that part of your promotion, because I have never seen that?

Ms Livingstone: The whole concept of a blue way is about that slow tourism. It is about families, that whole concept of being outdoors. You can build it around the heritage or around food, but it is that whole concept of slow recreation on the waterways.

We have very wonderful people in the Heritage Boat Association, whose whole lives are centred around the heritage boats that they own, but they also spend massive amounts of time preserving that part of all our heritage, using them on the waterways and inviting people to come and enjoy them and having educational programmes. That is part of this whole package of gift there is for the country.

Mr Easton: Apologies for being late. Your presentation mentions unlocking opportunities to earn income, what are you looking at there? Have you had any discussions about opening up the canal?

Ms Livingstone: Again, Newry canal is not in our jurisdiction. We have offered some technical help when people have looked for it, and we are very happy to do that.

I would like to create an ongoing income source for each of our waterways. On the canals there is the opportunity to use them because they are linear corridors to carry services, particularly dark fibre high- speed internet, and we can license that and then earn money off it.

On the Shannon and the Erne, there has to be a conversation around charging. If you have a £250,000, boat this is free to use. A very modest charge would transform things. Rather than registration being free, we could have an annual registration charge, but that is a political decision and would require political support and a change in the bylaws. You have 6,000 boats and 8,000 boats, so it is a big population. It is common practice across the rest of Europe. So there are different opportunities in different waterways.

Again, in the canals where we own property in Dublin, there is an opportunity there to develop that and lever capital out to help prepare the locks for example but also to create an ongoing sustainable income for investing every year in running the canals. The Chairperson (Mr Humphrey): You mentioned to Mr Easton that Newry canal does not come under your jurisdiction nor does Lough Neagh. In terms of your spend in Northern Ireland, what is in your jurisdiction?

13 Ms Livingstone: In Northern Ireland, you have the Shannon-Erne waterway, the Erne and the Lower Bann. So, it is 15% of the 1,000 km, and that is how you get the 15%:85% split.

The Chairperson (Mr Humphrey): Why is that? Are you going to tell me it is a political agreement?

Ms Livingstone: We spend more than that in the North. We actually spend £5 million every year.

The Chairperson (Mr Humphrey): It just seems to me to be concentrated —

Ms Livingstone: Because the headquarters is here.

The Chairperson (Mr Humphrey): It just seems to be centred here, when, obviously, the Newry canal is right on the border as well.

Ms Livingstone: The reason we got the navigations we have is that they are open. They are working navigations. The others are waterways without navigation, and, if anything was to be added, there would have to be a ministerial North/South decision.

The Chairperson (Mr Humphrey): I do not know whether you watched a great programme with Timothy West and Prunella Scales.

Ms Livingstone: We sponsored that.

The Chairperson (Mr Humphrey): You come out of that well because of the difficulty that they had, given their age, navigating the locks, whereas, in Fermanagh, they just came in the car to wherever it was, and we did not have the sight of an 80-year-old lady trying to work the locks. We came out of that looking very well. It looked tremendous.

You mentioned The Honourable The Irish Society: is that not a very wealthy organisation? What contribution does it make to the upkeep of the waterways?

Ms Livingstone: At the minute there is no mechanism for people to pay, in any form, for the use of the things that we manage and maintain.

The Chairperson (Mr Humphrey): My understanding is they have rights along the entirety of the .

Ms Livingstone: They would claim to own the soil and bed.

The Chairperson (Mr Humphrey): Do they make no contribution?

Ms Livingstone: No. They charge people to use it.

The Chairperson (Mr Humphrey): Yes. Can you give any examples of selling overhanging property?

Ms Livingstone: Yes, we have successfully sold airspace where people have overhung balconies over our property in Dublin. It is exactly like your garden. Your garden has a fence, and, if somebody wanted to build something hanging over it, you would charge them or you would not let them. That is the simplest way to put it.

In the North, we own very little property. We were transferred literally the footprint of the jetties on the water and some small amenity sites. In the South, we own quite significant property tracts, particularly on the canals, and we have the opportunity to commercially develop those. That goes into a reserve fund that is then available to invest in developing the waterways.

The Chairperson (Mr Humphrey): If The Honourable The Irish Society does not make a contribution towards maintenance and upkeep, does it make any contributions through sponsoring or providing infrastructure or furniture?

14 Ms Livingstone: It works with us on education programmes, and it sponsors some of the fishing competitions that we run. We are amicable partners.

The Chairperson (Mr Humphrey): It sounds to me like it could do more. We will look at that. Thank you both very much for your time this morning.

Ms Livingstone: Thank you for coming and hearing us. There is a boat trip afterwards, and we look forward to taking you out.

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