Interview: Robin Evans

If an organisation is riddled with huge, pressing and intractable problems, says Robin Evans, then it’s probably best off in the public sector. “Government’s great in a crisis,” he remarks. “It’s got unlimited resource.” But when a public body is running relatively smoothly, he believes, it can lose out to its more troubled peers: “If you’re not in a crisis you get starved, because the money goes to the crises – and government has 55,000 crises every day.”

In the 1970s and ‘80s, then, the public sector was just the right place for British Waterways (BW), the guardian of our 2,200 miles of canals. BW grades its canals’ state of repair on a scale of A to E, and Evans – the organisation’s chief executive since 2003 – says that following decades of chronic underinvestment, “in the 1980s, 40 or 50 per cent of our assets were in grades D and E.” But the equivalent figure today is less than 20 per cent, and the sunken shopping trolleys that characterised canals during that era have now
given way to narrowboats, joggers, and new riverside apartments.

In part, it was the slow-burning ‘urban renaissance’ of our post-industrial cities that brought life back into the canals. Beginning in Birmingham, Manchester and London’s Docklands, planners and developers put watercourses at the heart of regeneration projects; and in 1999, Labour’s deputy prime minister John Prescott began championing the rejuvenation of urban waterways. “He was a great guy; a visionary,” comments Evans. “A lot of people have their own views about John Prescott, but he believed in something – and he certainly believed that canals brought people together.”

BW was quick to capitalise on the wave of developments around its canals, launching joint venture specialist Isis and building a commercial property portfolio worth £460m. The numbers of ‘boaters’ living on BW’s waterways has expanded to 30,000, pulling in £20m a year, and utility company fees provide another £20m. Even during the recession, says Evans, BW’s rental income fell by less than five per cent; its property operations saw big asset write-downs, “but if you look at our main income streams, they’re incredibly stable.”

Saving cash to save the canals
However, since John Prescott’s ‘super-department’ was broken up in 2001, BW has been overseen by the Department for the Environment, Food and Rural Affairs (Defra). For Evans, the department’s “policy thrust hasn’t been: ‘What can these people do to deliver public benefits?’ but: ‘How can we reduce their cost to the public purse?’” Grants have fallen by about half in the last few years, leaving a persistent £15-20m gap between actual spending on canal maintenance and repairs and the figure that Evans believes is required.
In recent years, an efficiency drive has significantly reduced BW’s running costs. “This organisation’s been through a lot of pain,” Evans points out. “We’ve completely revamped our pension scheme; we’ve restructured; we’ve lost people; we’ve outsourced work.” Moving from local to national contracts for work such as dredging and vegetation clearance has saved millions, and BW is closing its London and Watford offices in a move to Milton Keynes. As a result, the organisation has managed to maintain its spending on canal maintenance and repairs even as its public funding has declined – but there, of course, is the rub.

“British Waterways has been extraordinarily successful for quite a long time in growing its income and reducing its reliance on government,” comments Evans. “The downside is that we haven’t managed to increase our total resource because as we’ve grown, our earned income government grants have declined, so the total amount we spend on the waterways hasn’t been increasing in recent years. That causes long-term problems for the maintenance of the waterways.”

Evans first began touting his preferred solution in 2008: he wanted BW to leave government for life as a trust in the voluntary sector. “I passionately believe that the best way to maintain and preserve historic buildings and structures is to make them viable,” he explains. “I’m not banking on the government always being there: if you rely on other people to pay you to keep the waterways viable, you’re always at risk. We’re trying to make ourselves self-sufficient.”

Winning the trust of politicians
By 2010, Evans had persuaded Labour to back his plans – and he has subsequently performed a similar trick with the coalition, which three weeks ago announced the funding settlement for the emerging Canal and River Trust. The agreement, which covers canals in England and Wales (those in Scotland will remain in public ownership) secures a public grant for the next 15 years – but for Evans, the real prizes are the new charity’s ability to fundraise and mobilise volunteers, and the power to retain additional revenue rather than seeing it clawed back by Whitehall.

Some 98 per cent of British people “think the waterways are a national treasure”, Evans enthuses, “but we’ve never really harnessed that amazing goodwill. Moving into a trust, where we can attract more volunteers, donations, legacies and gifts, is the way to increase our net income for the future and improve our waterways.” Evans believes that charitable status, which will require the reform of BW’s governance structures and change perceptions of the waterways’ ownership, is essential to build that kind of popular support and participation.

“I think we can only get those donations, those gifts of time and money, if people feel they’re involved in the running and maintenance and decision-making,” he says, pointing out that the number of top decision-makers will expand from 10 minister-appointed board members to 150 people spread between a council, a group of trustees, and a set of local waterway partnerships. The body’s new overseers will be “the most enthusiastic people; the people who care most about canals”, he adds; and then we’ll see public attitudes to the canals change. “Whose are these canals? They’re our canals. Who’s responsible for them? We are, not the government.”

Given the ability to attract donations and volunteers, and a grant hike scheduled in the trust agreement for 2015, Evans believes the maintenance spending gap will soon narrow dramatically. “We have an estimate of what we should be spending on the canals, and we’ve rarely got above 80 per cent of that,” he says. “We’re going to get within 95 per cent of it within about five years.” Asked whether the trust might hike the levies paid by boaters, he’s quick to argue that “this isn’t some sort of Trojan Horse, to move out of government and then let rip with rocketing prices.” Income growth will be from “volunteering, donations, legacies, and probably some kinds of social enterprise in and around the canals,” he explains.

He also believes that, when the long construction and development recession ends, BW will want to get back into the regeneration business. “Property adjoining waterways is worth 20 per cent more than property anywhere else, so the prime sites are alongside our waterways – and we’ll always want to benefit from that,” he says. The question, he adds, is exactly when that recession will ease. And there’s another thing: it sounds like Isis’s recessionary experiences have left Evans with slightly scorched fingers. “We’ll always be involved in regeneration: there are huge opportunities along the canalside up and down the country,” he says. “But I don’t think we’ll over-reach ourselves. That’s very dangerous. Every 30 years, there’s a correction in the property market.”

Becoming a free agent
No matter how much income the trust generates, though, Defra will remain its biggest single source of funds for the foreseeable future – and Evans says he’s sure the department will be an “interested and exacting overseer” as the trust works to meet its obligations under the agreement. However, in other ways he’s looking forward to a much more relaxed relationship with the department. “If you’re a minister the buck always stops with you, so you’re constantly concerned about when things appear to be not as good as they might be – then the minister gets his people involved to find out what the story is,” Evans explains. “We have very little of that [at BW], but nonetheless that’s what government and politics is about. In future we won’t have that, because the minister can quite rightly say: ‘The trust is responsible’.”

What’s more, the trust’s newfound freedom from Defra control will enable it to build stronger relationships with other parts of government. While BW remains a Defra agency, says Evans, “if you go to another department, they’ll feel: ‘You’re Defra, go and talk to them. Why do you want to engage us?’ Whereas if we’re independent, we’ll be able to go – for example – to the Department for Transport and say: ‘We’ve got some great cycleways into the centre of major cities’.”

Overall, though, Evans expects the new body to shift its focus away from Whitehall towards the wider world. “If you’re government-funded and a public sector organisation, you tend to look inwards,” he comments. “We’ve got to develop much better relationships with cities, local councils, parish councils, because that’s where I think we’ve probably been a little bit too remote in the past.”

Asked whether the canal trust might follow the National Trust’s move into campaigning, Evans sounds sceptical. “I used to work for the National Trust, and in my day they were absolutely not a campaigning organisation,” he replies. “I personally wouldn’t want to see that [at the canals trust]. I’d always want us to be the champion of the waterways, but that’s different from taking on a wider lobbying or campaigning role.” Ultimately, he adds, it’s a decision for the trustees – but his opposition is clear. “I think we’ve got a lot to do to look after our own waterways network,” he comments.

Show us the money
However, there is one topic on which Evans might not complain too vociferously if the new charity took its lead from the National Trust: executive pay. Last year the National Trust boosted its top salary by at least £40,000 to more than £210,000, while the number of employees earning more than £139,000 grew from one to eight. And now, as BW moves into the voluntary sector and adjusts its salaries structure accordingly, the trustees will have to decide exactly where to peg the canal trust’s own top managers’ wages.

British Waterways is famous within the public sector for its generous directors’ salaries: eight of them earn more than £148,000, with Evans receiving £220,000. According to the 2011-12 Association of Chief Executives of Voluntary Organisations (ACEVO) Pay Survey, however, the median pay of a voluntary sector chief executive is £60,000. Among ACEVO’s respondents, salaries don’t reach the National Trust’s stratospheric heights: the maximum salary in its survey is £155,000, while top pay among organisations with more than 1000 employees or a turnover of more than £50m sits at around £130,000.

Asked where executive pay levels might be set, Evans points out these variations within the charitable sector. “We’re a huge, £150m turnover business,” he adds. “We earn over £120m from commercial activities and have a huge property portfolio, worth £1bn. So you’ve got to make sure that you’ve got the expertise that you need, but you’ve also got to put that in the context of being in the third sector.”
Shifting BW into the voluntary sector may, of course, result in Evans receiving a substantial pay cut – but he’s plainly exasperated by my line of questioning. “It’s not my decision,” he says, spreading his hands. “When someone decides what I should be paid, I’ll have to decide whether it’s something I want or not. It’s out of my hands.” Even if he decides to go, he’ll have no regrets over managing BW’s move into the voluntary sector: “I’d be very proud that I’d done what I’d done, because I’d have moved the organisation onto a better footing.”

Cabinet Office minister Francis Maude has argued that the public sector need not match private sector salaries in order to attract talented managers – telling the BBC, for example, that people are “blithely told you cannot fill the job unless you pay this amount, and actually I think often that’s too easy. It’s a lazy view, and actually getting the right people is much more about exciting them with the sense that it’s a challenge, that they will find it rewarding.”

However, Evans takes a different tack. While everyone finds “a balance between doing a job you love and getting a reward”, he says, the fact that “you enjoy what you’re doing doesn’t mean that you have to be paid less. That’s a very strange value. The public and charitable sectors are full of people who are passionate about what they do. That’s great. But organisations need the right professionals.”

What happens next?
The trustees have a bit more time to make their salary decisions: the creation of the trust, originally scheduled for April, has been delayed as Defra seeks parliamentary approval. By June, though, Evans hopes the trust will be up and running – and for him, that will be unalloyed good news for Britain’s canals; in time, assuming that “the funding and finances are right”, he’d even like the trust to be handed the rivers currently managed by the Environment Agency. And he has secured a very long funding agreement: “We’ve done a deal that means we know what our grant is going to be for 15 years,” he points out. “British Waterways has never had the financial security that it’s going to have as a trust.” His next challenge is to build up earned and donated income: “If we can make waterways viable,” he says, “they’ll never be under threat again.”

Of course, after those 15 years, the government could theoretically end public funding for the trust. But the canals produce such important public benefits – £500m-worth by the Treasury’s measurements, Evans says – that he thinks the government will maintain financial support if the trust still needs it. Anyway, he adds, it would be a mistake to think that sitting within the public sector offers cast-iron protection in a financial emergency: when the Monmouthshire and Brecon canal breached in 2007, causing £7m worth of damage, “government refused to give us any extra money. The biggest breach we’ve ever had, and we had to find £7m; we had to withdraw from a restoration we were doing – and got hugely criticised for it – because we didn’t have any money.” Government has many priorities, he adds, and can’t always help out: “We’re a tiny, tiny, tiny, tiny part of government, and we were never going to get attention.”

So government rarely provides much help to fundamentally healthy organisations when they hit an emergency; and these days BW is pretty healthy. Government can, however – at least in these exceptional times – be quite helpful to ambitious parts of the public sector with innovative plans for change. Asked what he’s learned during the process of establishing the trust, Evans replies: “If you have a good idea and you’re passionate about it, and can demonstrate it financially and in other ways, governments are prepared to listen.

“What I’ve learned is: if you really believe you have an idea that will transform the fortunes of your organisation, and it’s good for government, then go for it. People are willing to listen.”