Not looking good for us

[Alan de Enfield]

17 minutes ago, Allan(nb Albert) said:

It is difficult to accuse the government of underfunding because it was agreed that grant together with other income streams was sufficient

 

 

But, but, but - please sir we didn't know how difficult it would be to raise 'giving' and its actually cost us a lot more to raise that we actually raised, therefore can we please HAVE MORE !

 

Extract of letter sent to the Treasury Minister requesting urgent help and a grant of £220m (please) for :

 

 

 

CRT LetterToTreasury Request 220 million Extra.pdf

Edited February 17, 2023 by Alan de Enfield

[IanD]

28 minutes ago, Allan(nb Albert) said:

Unfortunately, your response shows a lack of comprehension.

The deal between Defra and CRT was not just about government giving £800m over five years. It was also about transferring most of BW's funding streams and removing some of the restrictions placed on BW (e.g. ability to make loans). The expectation was that CRT would develop these funding streams and the new "charitable giving" funding stream such that future government support was not needed in the longer term.

A report by KPMG found that projections against ex-BW and new income streams taken together with grant were reasonable but cautioned that the condition of the waterways might deteriorate slightly.

As the contribution from "Investment" and "Joint Ventures" is so low against the projection in 2021/22 (and previous years) and can not be explained, I would suggest financial mismanagement. It is certainly not due to raging inflation because that started after year end.

It is worth noting that the deal was stated to be "tough but fair" by CRT's chair who signed it. It was claimed to give "certainty of funding".

It is difficult to accuse the government of underfunding because it was agreed that grant together with other income streams was sufficient
 

 

Well, *your* response shows a lack of comprehension, so yah boo sucks... 😉

 

The deal between Defra and CRT when it was set up ("it was agreed that grant together with other income streams was sufficient") had some optimistic assumptions in it to put it mildly, the numbers were massaged to make everything look rosy and get the deal done -- like Brexit.

 

Since then it's turned out that some of the assumptions were wrong, unexpected things happened like the financial crisis, and various projected sources of (increased) income either never materialized or were much smaller than predicted -- like Brexit.

 

"Financial mismanagement" means that major mistakes which could have been avoided lead to significant losses; as far as I can see there's little or no evidence of this. CART were pretty much handed a brown paper bag full of sh*t and when the soggy bottom fell out the government was able to avoid any blame, even though they generated said sh*t partly by pulling the wool over inexperienced CRT management eyes when CRT was set up. CART made some decisions -- based on optimistic assumptions -- which turned out to be wrong, but that in itself is not evidence of financial mismanagement.

 

It's crystal clear that CART is underfunded and has been from day 1, and penny-pinching by the government -- who are perennially guilty of underinvestment in infrastructure -- is largely to blame for this, given that there's no way on planet Earth that CART were ever going to achieve some of the things that were in "the plan" such as massive increases in income from "Friends" or big reductions in costs without any resulting reduction in maintenance standards.

 

I'm not saying that CART couldn't have maybe done better, but that's a long was from accusations of financial mismanagement.

 

If you have any *evidence* (as opposed to rhetoric) of actual financial mismanagement by CART -- you know, the kind of thing that gets people sacked or even sent to jail -- then I'd love to see it, and I'll admit that I'm wrong... 🙂

Edited February 17, 2023 by IanD

[Alan de Enfield]

29 minutes ago, Allan(nb Albert) said:

The deal between Defra and CRT was not just about government giving £800m over five years. It was also about transferring most of BW's funding streams and removing some of the restrictions placed on BW (e.g. ability to make loans). The expectation was that CRT would develop these funding streams and the new "charitable giving" funding stream such that future government support was not needed in the longer term.

 

I'm sure you will remember this ..................................

 

One can hardly imagine that DEFRA having being told that there has been a 25%  improvement is the condition of the principal assets , will need to know that C&RT has applied for a £200m 'emergency grant' from the treasury to do 'critically needed work' to the primary assets. 

 

 

CaRT has kept everyone in the dark regarding the pitch to the Treasury.  It does not appear to have thought it necessary to tell its council either.  Furthermore, it has not told Defra about the ‘critical waterways infrastructure resilience programme’.

Under its grant agreement with Defra, CaRT has to provide figures showing what percentage of principal assets fall within the two worst condition classes (D—poor and E—bad). In eight years, CaRT has produced figures showing that it has reduced the percentage of principal assets in poor or bad condition by 25% . Over the same time frame it figures show it has halved the number of high-risk culverts and embankments in poor or bad condition.

Perhaps, its Trustees are concerned about the fallout should Defra start wondering why CaRT’s figures show the condition of critical assets are improving but at the same time is asking for additional grant to make them more resilient to failure.

Perhaps it is because CaRT do not want to appear as having failed dismally.  It is an agreed objective under the grant agreement that government funding for CaRT will reduce or cease by 2027.

 

[IanD]

"The expectation was that CRT would develop these funding streams and the new "charitable giving" funding stream such that future government support was not needed in the longer term." was always pure cloud-cuckoo-land Brexit-grade BS -- it would have needed CART to bring in sums similar to the National Trust, as well as other income streams that didn't exist but definitely were going to in the future. Yeah, right... 😞

 

The fact remains that the projections did turn out to be far too optimistic and the need for government grant has gone up not down, which is why CART are in a financial hole and are asking the government for more money and boaters for higher license fees.

[Momac]

35 minutes ago, Alan de Enfield said:

 

When you pay for your 'pay & display' parking ticket you are paying for a proportion of the road sweeper, the white line painter, the man who empties the money out of the machine, the person in the office who orders the rolls of tickets, the person who makes up the wages, etc etc etc. 

Included in etc ... the midwife who assisted at birth and the later education of the dumper driver in the quarry that produced  the stone for the tarmac and no doubt many other things the list could be very extensive.

But really you are just paying to park.

[Alan de Enfield]

3 minutes ago, MartynG said:

ncluded in etc ... the midwife who assisted at birth

 

No - that comes out of your NI payments.

[George and Dragon]

19 hours ago, Goliath said:

which is evidence they’re not able to monitor all the 7day, 2day, 1day or what ever time restraints they keep messing about with.  
 

 

I really have no intention of getting drawn into this long, tedious and pointless discussion but walking the whole network every fortnight does not preclude checking the sections where more onerous mooring restrictions are in force more frequently. Neither does walking the whole system every 14 days mean that a boat observed in a particular place 14 days apart didn't leave the place for 12 days and return in the intervening period. 

 

If CRT want to enforce continuous cruising rules they need a better system than this.

[Momac]

1 hour ago, Alan de Enfield said:

 

No - that comes out of your NI payments.

[Allan(nb Albert)]

1 hour ago, Alan de Enfield said:

 

 

But, but, but - please sir we didn't know how difficult it would be to raise 'giving' and its actually cost us a lot more to raise that we actually raised, therefore can we please HAVE MORE !

 

Extract of letter sent to the Treasury Minister requesting urgent help and a grant of £220m (please) for :

 

 

 

CRT LetterToTreasury Request 220 million Extra.pdf

If you look at annex 2, that is safety critical backlog of £160m where CRT wanted £125m from the Treasury. CRT kindly offered to put in £35m of its own money. Note that we are two years into the five year programme.

With the Treasury not coming up with the money, CRT decided they would fund this work themselves by -

- Raiding a fund set up to close the black hole in the defined benefit pension scheme.

- Taking money out of diversified assets (The majority of investment assets inherited from BW were property but CRT's investment policy dictates that some should be invested elsewhere as a hedge against falling property values).

Then the big jump in inflation ...

Current situation is -

 

- they can no longer take money out of the "black hole" fund as the hole will grow due to inflation. They need to put more in.

- The value of diversified assets has fallen so less money is available from that pot. Value of property is also down slightly.

 

- The £160m is now £200m due to inflation and better knowledge of the work required.

As I understand it they are doing only reservoir repairs that are required by law (MIOS). The rest of it appears to be on hold.

[Allan(nb Albert)]

2 hours ago, IanD said:

"The expectation was that CRT would develop these funding streams and the new "charitable giving" funding stream such that future government support was not needed in the longer term." was always pure cloud-cuckoo-land Brexit-grade BS -- it would have needed CART to bring in sums similar to the National Trust, as well as other income streams that didn't exist but definitely were going to in the future. Yeah, right... 😞

 

The fact remains that the projections did turn out to be far too optimistic and the need for government grant has gone up not down, which is why CART are in a financial hole and are asking the government for more money and boaters for higher license fees.

... which is why ten years ago I started calling the deal "certainty of under funding". I din't think the projections (with the exception of charitable income) were not achievable. Rather, I thought that BW deliberately changed its "steady state" model to reduce the funding gap (the gap between income and expenditure).

With regard to asking boaters for more money, I'm not sure its a request ...

It remains to be see if the number of licenced boats continues to fall as a result.

 

[IanD]

12 minutes ago, Allan(nb Albert) said:

... which is why ten years ago I started calling the deal "certainty of under funding". I din't think the projections (with the exception of charitable income) were not achievable. Rather, I thought that BW deliberately changed its "steady state" model to reduce the funding gap (the gap between income and expenditure).

With regard to asking boaters for more money, I'm not sure its a request ...

It remains to be see if the number of licenced boats continues to fall as a result.

 

I think we're agreeing here -- the books were effectively cooked when CART was set up to make everything look unrealistically lovely without the government having to provide as much money as was actually needed. Now the chickens have come home to roost... 😞

 

"Asking" isn't the right term, "demanding" will be closer to the truth -- but being honest, what other option do CART have? There isn't a magic funding money tree to fill in the gap between their current income and what they need, so somebody has to pay to fill it -- and since the government seems unwilling to increase the grant, the poor bloody boaters are in the firing line... 😞

 

I'm sure some people will leave the canals as a result, but hopefully any losses will be concentrated among those who have been causing many of the problems (e.g. the CMers just looking for a cheap place to live who ignore the rules) rather than the boaters who are actually care about and use the canals as waterways -- the "real CCers" for example. Though I do fear that they'll be casualties caught in the CMers crossfire... 😞

Edited February 17, 2023 by IanD

[system 4-50]

Obviously it is C&RT's fault they are short of money, they should have diverted some of their lock-gate manufacturing workers over to making facemasks.

[Allan(nb Albert)]

48 minutes ago, IanD said:

I think we're agreeing here -- the books were effectively cooked when CART was set up to make everything look unrealistically lovely without the government having to provide as much money as was actually needed. Now the chickens have come home to roost... 😞

 

"Asking" isn't the right term, "demanding" will be closer to the truth -- but being honest, what other option do CART have? There isn't a magic funding money tree to fill in the gap between their current income and what they need, so somebody has to pay to fill it -- and since the government seems unwilling to increase the grant, the poor bloody boaters are in the firing line... 😞

 

I'm sure some people will leave the canals as a result, but hopefully any losses will be concentrated among those who have been causing many of the problems (e.g. the CMers just looking for a cheap place to live who ignore the rules) rather than the boaters who are actually care about and use the canals as waterways -- the "real CCers" for example. Though I do fear that they'll be casualties caught in the CMers crossfire... 😞

Oh dear, very careless of me😃

As I understand it, CRT are trying to find another £25m a year via savings or income. Obviously boaters form part of that as does this extra 10% from charitable giving. I don't know what they will do on the savings front - perhaps reduce headcount (again).

The only real way forward would be to start converting assets to cash and start spending on maintenance in a big way. Obviously it reduces future income but at least Defra can't point to £1.1 billion in assets and CRT reports of a slowly improving system.

[IanD]

20 minutes ago, Allan(nb Albert) said:

Oh dear, very careless of me😃

As I understand it, CRT are trying to find another £25m a year via savings or income. Obviously boaters form part of that as does this extra 10% from charitable giving. I don't know what they will do on the savings front - perhaps reduce headcount (again).

The only real way forward would be to start converting assets to cash and start spending on maintenance in a big way. Obviously it reduces future income but at least Defra can't point to £1.1 billion in assets and CRT reports of a slowly improving system.

Never mind, we all make mistakes 😉

 

An extra £25M a year will at best fill the temporary funding hole, but it will do nothing to reduce the massive maintenance backlog which is estimated to be anything up to £400M -- and still rising, since they're not even doing enough maintenance to stop the system from deteriorating further, regardless of whether they claim it's getting better this is quite obviously not the case, some more book-cooking seems to be going on... 😞

 

Unless some enlightened and extremely rich multibillionaire canal enthusiast ponies up, the only place this is going to come from is the government -- which is not hard to justify since it's spending on infrastructure which is what governments usually pay for. And after all it's only about 0.5% of what they spent bailing out the banks in 2008 or 5% of what they wasted on unsuitable PPE during Covid, so you'd think they could find this much down the back of Jeremy Hunt's sofa... 😉

Edited February 17, 2023 by IanD

[Jon57]

19 minutes ago, IanD said:

Never mind, we all make mistakes 😉

 

An extra £25M a year will at best fill the temporary funding hole, but it will do nothing to reduce the massive maintenance backlog which is estimated to be anything up to £400M -- and still rising, since they're not even doing enough maintenance to stop the system from deteriorating further, regardless of whether they claim it's getting better this is quite obviously not the case, some more book-cooking seems to be going on... 😞

 

Unless some enlightened and extremely rich multibillionaire canal enthusiast ponies up, the only place this is going to come from is the government -- which is not hard to justify since it's spending on infrastructure which is what governments usually pay for. And after all it's only about 0.5% of what they spent bailing out the banks in 2008 or 5% of what they wasted on unsuitable PPE during Covid, so you'd think they could find this much down the back of Jeremy Hunt's sofa... 😉

Well if £400 million is needed for the backlog of maintenance. I wouldn’t be having.a boat built to go nowhere in a few years time that’s for sure.😱

[Paul C]

The impact on some boaters won't be that much. They'll just contract the size of the network slightly, and remainder waterways will fall into further disrepair while concentrating on the popular holiday routes. With the prices of new boats, they're unlikely to notice an increase in the licence fee as much as existing boaters.

[David Mack]

6 hours ago, Alan de Enfield said:

 

No - that comes out of your NI payments.

Not so. NI contributions effectively just go into the overall government funding pot.

 

"The National Insurance Fund

NICs are often thought of as being ring-fenced to pay for the contributory benefits described above, or to pay for the National Health Service. The reality is different.

Some NICs revenue (about 19% in recent years) is allocated directly to the NHS. That is topped up from general taxation to whatever the government wishes to spend on the NHS in total: how much of that total notionally comes from NICs revenue is irrelevant. The remaining NICs revenue is paid into the National Insurance Fund. Notionally, the NI Fund is financially separate from other parts of government and is used to fund contributory benefits. In reality, however, this separation is illusory. In years when the fund is not sufficient to finance benefits, it is topped up from general taxation revenues; and in years when the fund builds up a surplus, it is used to reduce the national debt: essentially, the government lending money to itself. This makes the separation of the NI Fund from the main government account more or less meaningless. The government decides how much to raise in NICs, and how much to spend on the NHS and on contributory benefits; the amounts need not be related to each other, and generally aren’t."

https://ifs.org.uk/taxlab/taxlab-taxes-explained/national-insurance-contributions-explained

[Arthur Marshall]

3 hours ago, David Mack said:

Not so. NI contributions effectively just go into the overall government funding pot.

 

"The National Insurance Fund

NICs are often thought of as being ring-fenced to pay for the contributory benefits described above, or to pay for the National Health Service. The reality is different.

Some NICs revenue (about 19% in recent years) is allocated directly to the NHS. That is topped up from general taxation to whatever the government wishes to spend on the NHS in total: how much of that total notionally comes from NICs revenue is irrelevant. The remaining NICs revenue is paid into the National Insurance Fund. Notionally, the NI Fund is financially separate from other parts of government and is used to fund contributory benefits. In reality, however, this separation is illusory. In years when the fund is not sufficient to finance benefits, it is topped up from general taxation revenues; and in years when the fund builds up a surplus, it is used to reduce the national debt: essentially, the government lending money to itself. This makes the separation of the NI Fund from the main government account more or less meaningless. The government decides how much to raise in NICs, and how much to spend on the NHS and on contributory benefits; the amounts need not be related to each other, and generally aren’t."

https://ifs.org.uk/taxlab/taxlab-taxes-explained/national-insurance-contributions-explained

If I remember rightly, they used to be ringfenced, and the account was so much in surplus that the government changed the rules and dumped it in with general taxation.  If they hadn't, there would currently be enough to pay benefits and pensions at a sensible rate.  It's exactly the same as the reason private pension funds ceased to be able to pay decent pensions - they were legally obliged to put enough money aside to support the schemes, but the government allowed firms with a surplus in the fund to take a pensions holiday and stop contributing to it - enabling them to increase profits and pay higher dividends. Oddly enough, the funds ceased to be enough to pay decent pensions.  No-one expected that...

[Ronaldo47]

2 hours ago, Arthur Marshall said:

If I remember rightly, they used to be ringfenced, and the account was so much in surplus that the government changed the rules and dumped it in with general taxation.  If they hadn't, there would currently be enough to pay benefits and pensions at a sensible rate.  It's exactly the same as the reason private pension funds ceased to be able to pay decent pensions - they were legally obliged to put enough money aside to support the schemes, but the government allowed firms with a surplus in the fund to take a pensions holiday and stop contributing to it - enabling them to increase profits and pay higher dividends. Oddly enough, the funds ceased to be enough to pay decent pensions.  No-one expected that...

My recollection is that pension holidays were a consequence of, I think,  Gordon Brown making a rule that pension funds whose assets exceeded 105% of their liabilities,  had to pay the excess to the government to reduce their assets to the 105% level, effectively a form of taxation on pensions.  So pension holidays should have been no surprise.  When I first joined the GEC pension scheme, employee contributions were graduated, higher earners paying up to I think around 10%. When the company took a pension holiday, employee contributions were reduced to 4% for everyone, regardless of salary.  Had they not done so, some of both the employer's and the employees' contributions would have been confiscated by the government.

Edited February 18, 2023 by Ronaldo47
typos

[peterboat]

9 hours ago, Ronaldo47 said:

My recollection is that pension holidays were a consequence of, I think,  Gordon Brown making a rule that pension funds whose assets exceeded 105% of their liabilities,  had to pay the excess to the government to reduce their assets to the 105% level, effectively a form of taxation on pensions.  So pension holidays should have been no surprise.  When I first joined the GEC pension scheme, employee contributions were graduated, higher earners paying up to I think around 10%. When the company took a pension holiday, employee contributions were reduced to 4% for everyone, regardless of salary.  Had they not done so, some of both the employer's and the employees' contributions would have been confiscated by the government.

Along with taking the miners pension funds, because of those actions a subsequent ones minors were effectively robbed quick screenshot of the problem it caused  my Dad being one of them

[Midnight]

Is the consultation  a done deal?

https://canalrivertrust.org.uk/national-consultations/consultation-on-future-boat-licence-pricing-faqs

 

Tough or even "unfair", especially for genuine continuous cruisers?

[Paul C]

40 minutes ago, Midnight said:

Is the consultation  a done deal?

https://canalrivertrust.org.uk/national-consultations/consultation-on-future-boat-licence-pricing-faqs

 

Tough or even "unfair", especially for genuine continuous cruisers?

 

Have you already decided what future boat licence pricing will be?

No

[Paul C]

I forgot to add, while CRT say they haven't decided yet, its pretty obvious from the framework of the consultation, that since they said licence fees WILL be increased, they're going to target CCers and widebeam owners based on the popular opinion (the majority, being narrowboat owners with a mooring). Unless a big sway of those are altruistic and say "let's all have a fee increase evenly". Its a fairly safe bet to see the outcome here.

[Alan de Enfield]

2 hours ago, Midnight said:

Is the consultation  a done deal?

 

Of course it is - the only variable is, if the licence increases will be based on "Inflation + 4% + Surcharges for fat boats + surcharges for CCers", or if it will be "Inflation +20% + surcharges for fat boats + surcharges for CCers",

 

So as a minimum it will be a 14% increase and probably nearer 50% for fat boats, and maybe even more for "fat (boat) CCers"

[Jon57]

1 minute ago, Alan de Enfield said:

 

Of course it is - the only variable is, if the licence increases will be based on "Inflation + 4% + Surcharges for fat boats + surcharges for CCers", or if it will be "Inflation +20% + surcharges for fat boats + surcharges for CCers",

 

So as a minimum it will be a 14% increase and probably nearer 50% for fat boats, and maybe even more for "fat (boat) CCers"

Looking like the local housing authorities will be very business.