20 MAY 2003  

MR JIM STIRLING, MR JIM MCINTYRE, MR EUAN DOBSON, MR STEVE INCH AND MR JIM MCCONNACHIE

  Q1  Chairman: Good afternoon, gentlemen. Can I welcome you to this session of the Scottish Affairs Committee. We are reviewing the job creation potential of the modernised Forth, Clyde and Union Canal. We had hoped to be joined by Mr Ross from Falkirk Council but, unfortunately, he has had an accident on the way here this morning. We wish him a speedy recovery and hope it is not too serious. Can I just ask you, for the sake of the record, to introduce yourselves and state which organisation you are from?

  Mr Dobson: Euan Dobson, from Scottish Enterprise.

  Mr McIntyre: Jim McIntyre, from Scottish Enterprise.

  Mr Stirling: Jim Stirling from British Waterways.

  Mr Inch: Steve Inch from Glasgow City Council.

  Mr McConnachie: Jim McConnachie, from East Dunbartonshire Council.

  Q2  Chairman: Thank you. Could I ask you first if you would briefly bring the Committee up-to-date with the significant developments related to the Forth, Clyde and the Scottish Union Canals since December 2001?

  Mr McIntyre: Chairman, I think probably Scottish Enterprise, along with British Waterways, ought to highlight that. I think the progress has been very significant in that time period. Obviously with the canal reconnection completing just over a year ago, last May, there has been that significant development along the whole entire stretch of the canal. The Falkirk Wheel, probably the principal investment, has subsequently opened and has been very successful in attracting visitors—over 600,000 in a year. In addition, there has been very significant investment in Edinburgh Lochrin Basin and at Ratho. There has been significant investment at the other end of the canal in parts of North Glasgow, which I think we can bring you up-to-date on. So there has been a range of projects that have subsequently taken place. I think the report hints at around £220 million of private investment in the canal corridor that is forecast to take place.[4] There are significant job opportunities arising from that, as one would expect. Some of the detail is in the report. I would not wish to say any more, but obviously we will take questions and want to say something about the operation of the canal.

  Q3  Chairman: I think the document The Millennium Link arrived late to us, maybe you would like to give us a quick summary of that, if possible. I think it is a British Waterways and Scottish Enterprise document.

  Mr McIntyre: I can say something about the numbers of jobs.

  Q4  Chairman: That would be helpful.

  Mr McIntyre: I think there are three areas where jobs, in particular (which is what this report addresses) were predicted to take place. Firstly, in the construction phase, employment was obviously anticipated to take place in that, and DTZ Pieda[5] have assessed that there were 257 jobs created as a result of the construction phase of the project at national level and 211 in the central belt at local level, if you like. The original forecast was around 289, I believe. Jobs are also anticipated around the operation of the canal.

  Q5  Mr Robertson: Is that 289 altogether at national level, or separate?

  Mr McIntyre: National level. 289 forecast and 257 at a national level. The report also talks about jobs that will be created in the longer term, which were around the operation of the canal, and Jim Stirling will comment further on that. Perhaps most significantly of all, there was a large amount of employment anticipated in the longer term from private sector investment around the development opportunities that the new canal link provides. Today we are actually able to forecast that around 2,500 jobs would, once the developments currently being undertaken are delivered, be created.

  Q6  Chairman: How many of those are full-time jobs?

  Mr McIntyre: Those are full-time equivalents, Chairman. That is against the forecast.

  Q7  Mr Robertson: How is that split between part-time and full-time?

  Mr McIntyre: I do not think we could do that. These are broad assessments.

  Q8  Chairman: Has the level of private sector investment along the canal been as forecast?

  Mr McIntyre: I think it has probably been exceeded, Chairman, in the time frame. We are one year into it and, as I said, there is an estimated £250 million of private sector investment in a number of projects identified in the summary. In particular, the Lochrin Basin in Edinburgh, but there are very significant private sector investment plans in North Glasgow around Port Dundas and other parts of the canal. So I think that has gone better than anticipated in the time frame and I think there are opportunities for that to significantly increase as the canal becomes more established.

  Q9  Chairman: Could you say something about the section of the Union Canal that goes into Grangemouth? Are things proceeding there as they had hoped?

  Mr Stirling: It is the Forth and Clyde that goes into the Forth at Grangemouth, Chair. The situation in Grangemouth remains much as it was the last time. We have ambitions to improve the River Carron. To do that, we would probably build a weir or a barrage across the Carron near the yacht club. I am sure we stated that the last time, and our ambition remains. In the meantime, we have progressed some of the environmental work which needs to be done before we can consider the feasibility of the construction. There are some difficulties with the quality of the water in the River Carron, and if you impound it with a barrage or a weir then you need to examine the consequences of that. So we are looking at the environmental issues pre-feasibility of a barrage, if you like. The other question which still remains in Grangemouth, and which is currently unresolved, is the situation of blast zones and chemical zones associated with the industrial complex. I would think we would all agree that we have ambitions to see the old dock in Grangemouth used for leisure and recreation connected to an improved River Carron, but it has difficulties associated with it which we need to work towards. Therefore, to be strictly honest, our priorities have been focused on where we can have quicker results, and we are preparing for the future at the Carron. It is also worth saying that the entrance to the canal has worked probably better than we expected. The tidal nature of the River Carron, as you know from last time, creates difficulties with both water depth and headroom as we use the river, but the customers have found it easier than they thought they would and we now, for example, have de-masting facilities on the river so they do not need to de-mast at the marina at Forth Bridge (whose name escapes me at the moment!). So it is slowly but surely being improved and people are becoming used to using it.

  Q10  Chairman: Can you tell me, do your ambitions have a time-scale?

  Mr Stirling: You are probably talking five years before you are in a situation to be chasing the money for it, I would think.

  Q11  Chairman: Is the canal now joined from end to end or are there still breaks?

  Mr Stirling: No. The Forth and Clyde is open from end to end. The Union is open from Edinburgh to Falkirk and the two canals are connected at Falkirk. Of the project that we embarked upon there are no breaks. On the original Millennium Link there is still a break between Spiers Wharf and Port Dundas in Glasgow.

  Q12  Mr Robertson: Part of the presentation we got was basically a regeneration of the bottom end at Clydebank. What is happening with that?

  Mr Stirling: It is part of a bigger picture down there. Scottish Enterprise Dunbartonshire are working with the local authority on a much bigger regeneration right along the riverfront from John Brown's yard down, and the canal is seen as an integral part of that—the river on one side and the canal on the other side, in essence. There are also discussions going on about development of the town centre and the associated land around the town centre. All I can say, at the moment, from the British Waterways point of view, is that we are involved in that and we are pro-actively discussing the potential with the development agency.

  Q13  Mr Weir: One of the things that struck me when we visited the canal was I could see the development potential in certain stretches of it but on other stretches it was less clear, particularly in the Wester Hailes area of Edinburgh. Given that in your report this morning I can only see one development specifically related to Wester Hailes, which is housing, I just wonder what efforts have been made in relation to the economic development of some of these more fragile areas of the canal rather than the city centre areas along the canal?

  Mr Stirling: Edinburgh City Council are working on a study with Wester Hailes on that very issue. I am trying to find it within the Edinburgh submission to the Committee. "Wester Hailes Regeneration . . . Based on the above, the City Council, Scottish Enterprise, Edinburgh and Lothian, British Waterways and the Wester Hailes community have commissioned an in-depth action study to identify concrete development proposals, and a defined development strategy for the area. Associated survey of development sites and a range of economic development proposals, with potential funding sources and potential development vehicles . . ." are being looked at. Two things which are slightly more imminent than that, as I understand it, include a new community centre beside the canal, with funding coming from the council. There was some funding from the Millennium Link project, which we have passed to Edinburgh Council, to go towards the community centre and a community boat. The community in Wester Hailes have a boat now. It is an old Seagull Trust boat which Seagull Trust do not need any longer and they have donated it to Wester Hailes. We have been helping with training the people of Wester Hailes how to use and operate a boat and how to look after a boat. So there are small beginnings in Wester Hailes, but the council is actively working with the community in Wester Hailes to make more of it.

  Q14  Mr Weir: What do you see as the economic activity that might create jobs in Wester Hailes? That is something that is completely lacking in what you said. You talked about a community centre and housing here, but there is nothing about economic activity. That was one thing that was raised in Wester Hailes when we were there—how are jobs created in areas like Wester Hailes? It would be interesting to know if Scottish Enterprise, in any of its work, looked at what sort of jobs can be created in an area like Wester Hailes. It is easy to see development in a city centre, but it is a lot more difficult to see the houses and benefits in the wider area.

  Mr McIntyre: I think you cannot actually separate jobs created in the city centre of Edinburgh from the people in Wester Hailes. I would point to the significant investment that the council has made in Edinburgh Park, which is extremely close to Wester Hailes. SEEL (Scottish Enterprise Edinburgh and Lothian) have made significant investments in renewing the shopping centre there which has some job impact. I agree that actually creating employment opportunities immediately in that vicinity is a challenge and we will endeavour to do that through community regeneration strategies, but I think it is also fair to say that people in Wester Hailes do take jobs in the city of Edinburgh and the surrounding areas.

  Q15  Mr Weir: I accept that, but when you gentlemen talk about using the canal as a development opportunity for those within the community of Wester Hailes, everything I am hearing suggests that that is not happening.

  Mr McIntyre: I think I have talked about projects that do create employment opportunities across the city. In addition there has been work commissioned by British Waterways and Scottish Enterprise which is a business development guide to opportunities in the canal. It was a piece of work which was actually intended to try to draw the opportunities of the canal to each of the communities that are adjacent to it. That work is complete. What that tries to encourage people to do is to look at the canal-based business opportunities, try to direct people through Business Gateway or through the local enterprise companies or councils in those areas to try to give support to those businesses. It has always been difficult to create employment in those areas, particularly where the market is obviously more attracted to invest in other parts. We have endeavoured, through the business development activities that I mentioned and the project activities elsewhere to create employment in those areas, and training schemes to try to give people the skills that allow them to access those opportunities.

  Mr Weir: I remember specifically, discussions at Wester Hailes about the traffic on the canal giving opportunities to create smaller businesses canal-side. That does not seem to be happening from what you are saying. Also, is there specific funding available to try and attract small businesses to set up to serve the canal?

  Q16  Mr Hamilton: I would like to support the point my colleague is making. I know the area quite well as an MP for Midlothian. They have just announced in Edinburgh Park the new station they are going to put there, in October of this year—a new rail station being established. We could take the economic development and regeneration of Wester Hailes as one part, but another is tourism. It sits right on the intercity bypass and is one of the easiest access points you get. Surely one of the things that should be looked at is not necessarily going to the city centre or near the centre where the canal goes, but Wester Hailes could be the ideal location for a tourist attraction in that area, because it draws people in from central Scotland, northern Scotland and indeed the south of Scotland, because of its location on the bypass and because of its close proximity to Edinburgh Park where there is now going to be a rail link into that area. Has any thought been given by Edinburgh Council and yourselves in relation to that potential location?

  Mr Stirling: Specifically on that one, I have to say I do not know for sure. I think it is worth just saying to the Committee that I think we need to be cautious about being pessimistic too early about what is happening beside the canal. The canal through Wester Hailes was opened in Autumn 2001 or 2002 (it has not been open very long). Traffic on the Union Canal is small at the moment. We are starting from a zero base in the Lowlands. We are getting encouraging transit traffic across the Forth and Clyde. If you look at the projections we made, we are projecting over 250 vessels this year and we were predicting 500 after year five. On the Union Canal traffic is bound to be slower to get going because there is no passing trade, it is people who keep their boat on the canal, for example, at Ratho where the largest collection is, or the holiday hire boat trade which has only started this summer. On both canals we have a partnership agreement with probably the biggest hire boat operator in England, Black Prince Holidays, and they are putting narrow boats on to the lowland canals. We have purchased some three steel cabin cruisers which will be put into the hire fleet very shortly, and two local operations have got one or two boats on hire. We are all trying to co-operate together, we are trying to get local people to do the actual running of the fleet. Really, until we establish a sensible amount of traffic it is difficult to know whether the tourism business will set up beside the canal, because it is fair to say that towpath usage has gone up hugely on the Millennium Link and there are more development sites being thought of than had been predicted beforehand. When it comes to small, localised things happening, new businesses, they are actually very slow at the moment. The public sector is trying to kick-start them; BW is working with the hire boat industry and Scottish Enterprise Forth Valley are helping businesses in the Falkirk area. So, to some extent, we need to be patient and we need to get this up and running. One of the crucial things about Wester Hailes is the changing perception and the changing attitude. I have not heard now for a long time any difficulties with the few boats that we do have going through Wester Hailes, whereas when the canal was first opened people said "Oh, don't know if we want to take the boat through Wester Hailes". To my knowledge that is not a problem that we are having now. There will be isolated incidents, as there are anywhere, but there is no notion that you cannot go from Ratho to Edinburgh through Wester Hailes.

  Mr Weir: Far from being pessimistic, we were quite excited by the prospect of regeneration along the canal, particularly in Wester Hailes. What concerns me is that nothing we have heard today would suggest there is any real thinking on imminent development in the area. It seems to me from the list we have that we are looking at development in areas where developments are likely to take place in any event in respect of the canal. For the centre of Edinburgh and the centre of Glasgow the chances of development there are fairly great anyway, irrespective of the existence of the canal. I am not so sure about Wester Hailes.

  Q17  Ann McKechin: British Waterways in their memorandum mentioned that they were having a joint evaluation study with Scottish Enterprise about the economic activity in the wider corridor area of the canal. I just wonder whether either of you could give any indication of what has been revealed so far in that study.

  Mr Stirling: I am assuming it is the Pieda post-completion monitoring report, of which a summary has been given—I admit very late—to the Committee. The summary of the review findings was only finalised last week, I believe. I think it is encouraging, as Jim McIntyre said earlier, the level of activity around the canal. A couple of indicators to the fact that the project is going well, taking the Glasgow end, is the decision by Glasgow City Council in principle to support the coming together of British Waterways and ISIS the public/private property development company in the whole Glasgow North area, pulling together the social inclusion partnership areas and such like, using the canal as a linking mechanism rather than as a barrier. As you know, the canal just now in North Glasgow tends to be a barrier rather than a link, and the concept of what has been worked up in Glasgow is to turn that canal from being a barrier into being a link, with new crossings and new longitudinal linkages and new opportunities. In Falkirk, working closely with Falkirk Council and Scottish Enterprise Forth Valley, as I understand it, we are now doing site investigations on an industrial estate at Tamfourhill with a view to turning that into more productive use in association with the Falkirk Wheel and the developments down to Rosebank, where British Waterways are currently the owners of a redundant distillery and are pursuing a planning application for mixed use development. So there is an awful lot actually beginning to happen. I think the public sector is playing a big role in that, but on strategic development sites I think you can see the private sector coming. I think where the private sector is lagging at the moment is at the smaller scale of activity, and the work we are doing with Scottish Enterprise in marketing opportunities and giving one-stop shop-advice will help that.

  Mr McIntyre: Chairman, can I give some figures to the Committee that might help? We forecast that we might be able to get investment in around 22 sites. There are actually 64 known projects along that corridor. Eleven of those have started and 14 significant ones of the total have an estimated investment value of £229 million. I think I said £250 million earlier, Chairman—apologies for that, I should have said £229 million. Of that, it is predicted that that will generate around 2,552 jobs along 10 of the sites, but of course there are another 50 or so projects that are either in planning or coming through, and the reason I was expressing quite a lot of encouragement on that is I think that is one year after the canal has opened. So those are quite significant. I accept the comments made earlier that obviously it is easier in the earlier stages to get investment in city centres, and some of it, it could be argued, would happen anyway, but I think there are some investments in places like Kirkintilloch, for example, and places like Auchinstarry, where investment is being made that would not have been made without the canal project, for example. Ratho, I think, is a very good example. I think the public sector continues to invest there. Scottish Enterprise alone has invested a further £2 million in projects not within the city centre but in different parts of the canal corridor area. Ratho is a major employment creator and tourist attraction, admittedly on the edge of Edinburgh, but there has been investment in Port Dundas, there has been investment at Kirkintilloch and there has been investment in a variety of other sites. I would say it is very encouraging after one year that we can identify £230 million worth of investment in these ten sites and a forecast job number of around 2,500. I can only see that growing as the other smaller projects and other projects come to fruition, particularly if some of the big-scale projects are pulled off around Maryhill. I know Glasgow Council are pursuing that. There will be a regeneration effect. There is investment going in Firhill and I think there is a very positive story here about property markets responding to what is clearly a very significant public sector investment.

  Q18  Ann McKechin: Clearly one of the rationales for your work was that basically there would be a catalyst effect on the canals' improvement. We have mentioned the involvement of the public sector. How do you see that materialising further with the private sector? You mentioned the Firhill project but there are obviously other users of the canal which suffer particularly from social deprivation and economic deprivation. How do you think you can bring in the private sector and, also, keep the goodwill and support of the public sector going to make sure we reach these other areas of the canal?

  Mr Inch: May I make one or two introductory remarks before answering the specific question? I think when I first spoke to the Committee we were putting a number of policy frameworks in place. The Glasgow City Plan had not yet been considered by the City Council but was on the point of being finalised and we had a draft canal strategy for Glasgow which, again, had not been considered by the Council but was about to finalised. I am pleased to tell the Committee that those documents have now been approved by the Council; the City Plan has been through the public inquiry stage and we are making the final amendments in view of the outcome of that. We have also had the final canal strategy through the City Council. The City Plan identifies the canal corridor as a key opportunity for the city, and that is reflected in the City Vision scheme, which we are finalising for submission to the Scottish Executive within the next two weeks. That will be one of ten key regenerator projects for the City of Glasgow and surrounding regions. Having produced policy documents, the challenge given to us by the Leader of the Council was to take this forward and actually get them implemented. The words are fine but I think the actions count for more. We have done a substantial amount of development work on the canal corridor in Glasgow. We have identified eight main areas of opportunity; most of those lie between Port Dundas to the north of the city and up to Stockingfield Junction with Maryhill Locks. I think some significant progress has been made over the last couple of years. We have seen the successful completion of the Havana Locks housing development by Stewart Milne Homes; we are in discussion with Belway Homes about putting housing development next to Maryhill Locks and a planning application has been submitted for that. We have finalised plans for the Ruchill new housing neighbourhood, which takes us from Ruchill down into Possil and Keppoch. That has been prepared fairly closely with community groups within the area through a joint community consultative group, and I think we have prepared a master plan which is acceptable to the local community and, I think, will also be attractive to private sector investors. We have already seen some very significant private sector housing investment within the area. In terms of employment-related developments, we now have Luddon Construction on site in Port Dundas building the first phase of a development which will eventually total 200,000 square feet of class 4 and class 5 business space. The first two buildings are already pre-let and they are dealing with inquiries for buildings 3 and 4. That has been development on a very difficult site; it is very steeply sloping, it has got electricity cables under it and pylons over it, so very difficult, but facilitated by the disposal of the site by the Council at below market value and with a grant from Scottish Enterprise towards exceptional site costs. The credit really goes to the private developer for coming in and tackling such a difficult site in such a positive way. We have also seen the completion of a business centre for Glasgow North in Port Dundas which is fully occupied. We have seen improvements to Anniesland Industrial Estate (and they are well under way at the moment) funded by Scottish Enterprise, and we are still working on a master plan for the possible development of Dawsholm Park next to the incinerator (for those who do know that part of Glasgow), but close to where Strathclyde Passenger Transport are building a new railway station. Again, these developments will all bring new jobs in to the north of the city. In terms of the joint work with British Waterways Board, we have been introduced to ISIS as their joint venture partner. We have substantial land holdings on the canal, as have British Waterway Board, and we are discussing entering into a partnership which would not tie our land into companies like a lock-in agreement; it would be jointly agreed to do certain types of work and that would include housing development and, also, business related development and environmental improvements, and hopefully some tourist related projects as well. These discussions are at an early stage but we are meeting on a monthly basis through a group chaired by myself within the Council. As Jim has said, the Council has agreed the principle of a joint venture and it has also agreed to consider the use of compulsory purchase powers to help with the land assembly process. The first test of the joint venture will be the re-connection of the canal that currently finishes at Spiers Wharf. Around the corner from Spiers Wharf there is the basin complex which was formerly the Pinkston Power Station site. These things are separated by a road at the moment where the canal is culverted. We currently have an application in for European funding and Millennium Commission funding with some top-up funding from the City Council, British Waterways Board and, hopefully, Scottish Enterprise Glasgow to put that re-connection into place. That frees up, I think, something like 12 to 15 acres of land for employment related development. So we have taken the master plan and tried to give it some life, and I think the early signs are very encouraging for the area. One other point I would finally mention is the City Vision scheme that we have to produce for the Scottish Executive. With that goes a City Growth Fund, and at the moment it is likely the Council will approve an allocation of money for canal-related development on that stretch of the canal. I think some of that will go towards re-connection but some of it will go to bringing old buildings into use and will be directly focusing on the former Maryhill, Borough Hall and Baths complex, which has been empty and is in very poor condition at the moment. That could come into use as a business centre or a business and community centre.

  Q19  Mr Robertson: Steve, can I ask you if you remember back to the last evidence session when we were asking about the agreement—and you mentioned this in your statement—in principle with joint ventures, etc, and you have taken that a stage further. If you remember, I asked questions about other councils. Have you got other councils involved with the canal development and, similarly, in the agreements you are having yourself with British Waterways?

  Mr Inch: As part of the process of preparing the City Vision statement (which, I suppose, more technically, is the City Region Vision statement) we have had discussions with East Dunbartonshire Council and George Thom, who is the Strategic Director—Development and Environment, and we have had discussions with West Dunbartonshire Council and with the Clydebank Rebuild project. When we publish our City Vision statement or talk about the canal it is not just about the Glasgow section of the canal but the opportunities to link development in Glasgow to development in the two adjacent local authorities.

5   See Ev 15 para 7. Back