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The ins and outs of setting up the Canal & River Trust

The Waterscape website has published a summary of the process of setting up the new Canal & River Trust

After a substantial amount of suspicion and mistrust among many canal 'activists', the 1,000-word document might clear up some issues, but is unlike to quell them all.  Nevertheless, it clearly outlines six steps being undertaken: 

  1. Transfer Order - This is the government instrument that transfer BW's statutory functions and amends legislation. It involves parliamentary scrutiny, a vote by Lords and Commons, and then a signing-off by the Environment Secretary. Waterscape says that "it is perfectly normal for such legislation to be considered by Parliament in anticipation of a transaction and before all the other pieces of the jigsaw are in place. 

  2. Transfer Scheme - transferring ownership of BW's approximately £500million of assets to the new Canal & River Trust. This is subject to conditions in the Trust Settlement and Grant funding agreement (3 and 4 following), so is not completed until those are settled.

  3. Trust Settlement - This sets out the terms under which the waterways will be held by the new Trust on behalf of the nation 'in perpetuity'. 

  4. Grant Funding Agreement - This is the 'meat' of the financial side. It sets the government's terms for providing (approximately) £750 million of funding over 15 years, as well as protecting BW's £500 milllion of assets for their primary purpose of providing revenues for the maintenance of the waterways. The terms of this agreement are interdependent with the terms of the Trust Settlement (above) and the Articles of Association (below), and so cannot be completed until the terms of those instruments are also settled.

  5. Articles of Association -  BW said the Canal & River Trust was set up last September with a temporary set of Articles of Association in order to get the company registered at Companies House. Some of those articles were said at the time to be dependent on the eventual terms of the Trust Settlement and Grant Funding Agreement, and would need alteration - for example to cater for the role of the new overseeing Council.

  6. Charitable Registration -The Canal & River Trust was set up initially as non-trading 'shell' company (officially "a private company limited by guarantee with charitable objects"), and did not need to be registered as a registered charity until it has £5,000 or more of income annually. Defra has said the application for charitable registration could not proceed until the terms of the Trust Settlement, the Grant Funding Agreement and the revised Articles of Association are settled. However, they also say that charity registration is "on track in accordance with the project plan". 

Tuesday 20 March  | Andrew Denny  | 4.40pm, Tuesday 20 March 2012

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