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NORTH LANARKSHIRE COUNCIL

To : PLANNING AND ENVIRONMENT COMMITTEE Subject : The Millennium Link Canal Project

From : DIRECTOR OF PLANNING AND ENVIRONMENT

Date : 12TH.APRIL 2000 Ref : N/PL/39/14/CL/JK I I I

1. Purpose of Report

1.1 The purpose of this report is to update Members of progress on the Millennium Link Project, and to seek approval to pay the previously guaranteed sum of &346,000to the Project.

2. Background

2.1 Construction commenced on the Millennium Link Canal Project in 1999 and the objective is to restore navigation to the Forth and Clyde & Union Canals by the year 2001. The project is being implemented through a partnership of British Waterways, seven Local Authorities and the Scottish Enterprise Network, all co-ordinated through the Lowland Canals Steering Committee.

3. Progress

3.1 The project consists of 12 major construction contracts, dredging, structural reinstatement works and landscaping. Work is currently underway on all 12 major contracts and other engineering works required to restore navigation. The major works required in , that is new bridges and associated road works at Auchinstany and Wyndford, and restoration of the at the latter location, commenced in November 1999 with completion of this contract planned for September 2000. A further contract to restore navigation under the A80 road at Castlecary, just outside the Council boundary, also commenced in late 1999, with completion due in November 2000.

3.2 The intention of British Waterways is to restore navigation progressively as contracts are completed. This will be most evident on the during 2000, since there are no locks on this canal. Restoration of the full length of the Forth & Clyde and Union Canals is expected to be complete by Spring 2001, with completion of an interchange between both Canals at expected in Autumn 200 1. Thereafter it will be possible to sail from the River Forth at Grangemouth to the River Clyde at Bowling with a connection via the Interchange to Edinburgh. The Union Canal terminates in Edinburgh in the Lothian Road area.

4. Management/ 170

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4. Management Arranaements

4.1 As advised to Committee in September 1999, following an indication that could no longer provide an officer to Chair the then Lowlands Canal Working Party, this has now been replaced by a Lowland Canals Advisory Group comprising officers from the same partner organisations i.e. British Waterways, Local Authorities, Scottish Enterprise and Voluntary Groups, but now chaired by an officer from Scottish Enterprise. This Group now meets three times a year, shortly in advance of the Steering Committee. At the first meeting of the Advisory Group in February 2000, it was agreed that, since the Project is now well advanced in construction terms, the attention of the partner bodies should be directed towards ensuring long term benefits from the Project for the areas through which it passes. This is to be achieved through a marketing and communications strategy for the Project, the setting of appropriate targets for environmental and community outcomes from the Project, and the delivery of economic environmental and community benefits through local partnership groups. One such Group is being formed between the Council and Lanarkshire Development Agency. Progress in these areas will be reported to Committee in due course.

5. Finance

5.1 North Lanarkshire's contribution to the Project is 2934,000 of the total Project cost of &78m, payable in instalments between 1997 and 2001. In early 1998 it became clear that, because European Regional Development Fund monies were less than the amount sought, there was a shortfall in the Project of &7.8m. The various partners were asked to underwrite this shortfall so that British Waterways could obtain the Millennium Commission grant of 232.3m at that time .Of the total of 27.8 million, the six Local Authority partners were asked to guarantee 22 million, and in March 1998, the Council agreed to guarantee its share of this shortfall, amounting to 5346,000. The under-writing mechanism was designed to allow the Project to proceed while other means of meeting the shortfall were to be pursued. The Steering Committee has now been advised that to date the proposed initiatives have not generated sufficient funds to reduce the shortfall and therefore British Waterways has written to the underwriters to request payment. The sum of 2346,000 has been requested from the Council in the financial years 2000/2001 and 2001/2002. It has been agreed with the Director of Finance that the optimum arrangement for the Council is to pay 241,000 in the year 2000/2001 and 2305,000 in the year 2001/2002. British Waterways has indicated that this would be acceptable.

5.2 As noted above there are six Local Authorities in the partnership, which together agreed to underwrite a total sum of &2 million with the remainder being met by The Scottish Executive (22 million) and British Waterways (23.8 million). All the Local Authorities have agreed to pay their guaranteed sums, but in varying proportions over the two financial years.

5.3 Although British Waterways is entitled to seek provision of the funding pledged by the Council as part of the under-writing arrangement, it is disappointing that the other avenues pursued by British Waterways and Scottish Enterprise to meet the shortfall have been unsuccessful. These included funding from sources such as: Landfill Tax; private sponsors and UK and US Charitable Trusts and Foundations and major corporations; and forming a linkage with a bank to obtain allowances tax relief, which is not available to a non-tax paying body such as British Waterways. The Steering Committee has now been advised that none of these approaches have been successful to date in reducing the shortfall. The most promising source, the linkage with a bank to obtain capital allowances tax relief, appears to be a possibility, but the likelihood is that this would not generate any income until the latter part of this decade, well beyond the end of the Project period. Therefore realistically, any refund of the Council's underwriting contribution is unlikely.

Recommendation/ 171

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6. Recommendation

6.1 It is recommended that the Committee (i) notes the content of this report., and

(ii) agrees to a total payment of &346,000, to be paid in the financial years 2000/01 and 2001/02.

David M Porch DIRECTOR OF PLANNING & ENVIRONMENT 27'h. March 2000

Any person wishing further information on the above should contact Craig Lindsay on extension 01236- 616458

Reports2000fiPL39 14/CLiJW27mh