In light of soaring inflation, which is impacting the costs required to keep the waterways safe and navigable, the Canal & River Trust has annouced an inflationary rise of 4% in UK boat licence fees from 1 October 2022. This is in conjunction with cost saving measures that the Trust is taking and actions to increase income from other sources.
Whilst recognising that a second increase in fees this year is regrettable, the Trust is facing significant increases in a range of its costs – notably the prices of energy, fuel, materials and other construction costs which are rising by more than headline consumer inflation rates, leading to a projected shortfall in their finances as costs outstrip budget projections and are forecast to exceed income.
Additionally, the Government grant payment – which goes towards the cost of maintaining the waterways – is frozen this year (and hence declining in real terms) and until 2027. Unless measures are taken urgently by the Trust to address its budget gap this year, its priority works could be significantly affected.
The rise follows the earlier increase in fees, also 4%, which cam into effect from 1 April. Consequently, boaters renewing their licences from 1 October will face a combined 8% increase. This will still be some way below current inflation of 9.4% and predicted to rise further. When the earlier 4% increase in boat licence fees was agreed in October 2021, UK inflation (CPI) was 3.1%, with some short-term increase predicted but nothing close to current sustained rates of inflation.
In order to reduce spending, the Trust is scaling back on non-essential works and focussing on those which are required legally or which support navigation. Whilst this winter will necessarily see a number of planned works deferred, the Trust will still deliver one of their largest programmes of repairs and maintenance to date. The Trust is also making cost saving cuts more generally across the business and scaling back any discretionary activities; however the asset repair works are the predominant use of their funds, above the day-to-day cost of keeping the network open. In parallel, the Trust is seeking to maximise revenue from our other income streams.