The car, the bus, the plane, even the first electric passenger train – the canal can boast it’s been around longer than them all.

However, as Steve Dunlop, the director of British Waterways Scotland admits, “for a while the image of Scotland’s canals was a very negative one, it would be where children were lost, cars were dumped, they were just no-go areas.” Now, however, Scotland’s 200-year-old canals are undergoing what he calls “a physical transformation, a renewal of the network” that is beginning to bear fruit.

British Waterways Scotland manages the 137-miles (220km) canal network which includes the Caledonian, Crinan, Forth & Clyde, Union and Monkland canals, and while British Waterways is a national corporation across the UK, responsibility for inland waterways in Scotland is a devolved matter. British Waterways Scotland receives grant funding from the Scottish Government to support the canals remaining open and in a safe and well-maintained condition.

Dunlop says: “We have now a financial transparency and a separation of resources, a fiscal separation, and what that allows us to do is to be very clear about where the investment that the Scottish Government makes in British Waterways Scotland goes, where that money is recycled in Scotland and that’s very important. So we’ve now got a financial position within a national corporation that makes it clear what the Scottish Government gets from its money.” He says that British Waterways in Scotland does three things – looks after the network, which is scheduled ancient monument, gets public benefit from the canals by driving customers and people to it (and last year there was around 27 million visits to the canals in Scotland, compared to around 5 million five years ago), and, thirdly, uses the canals as assets to transform places and spaces in terms of regeneration. Indeed, an independent analysis in December 2007 found that investment in Scotland’s canal network had stimulated £282.1m of private investment and supported 4,838 jobs.

The highest profile example of this “transformation”, which demonstrates what can be done, is the Millennium Link, which restored the Forth & Clyde and Union canals, and includes the Falkirk Wheel, which was opened in May 2002.

Dunlop says the Falkirk Wheel is “a very important symbol that illustrates, we think, the merits of Scotland’s history in terms of creating a canal system and it brings back to life its industrial past, but it does so in a way that illustrates the ability for Scotland to be innovative”. The Falkirk Wheel, a unique structure in the world, attracts more than half a million visitors a year, while performing a very functional role in connecting two canals.

“What we demonstrate through that is that these are historic monuments that actually have a real future, and [it] refreshes and excites people to view canals in a different way.” This, Dunlop says, is something that British Waterways Scotland are going to concentrate on in the next five to 15 years, in seven places across Scotland.

While any development, Dunlop says, has to be understood in terms of what impact it will have on the canal as an ancient monument, and “if it’s something that complements and enhances the context of the canal then we can support that”. However, he adds: “That doesn’t mean that it can’t be contemporary, it doesn’t mean to say that it can’t be a large development, but it has to be absolutely sensitive, it has to respect what has come before and it has to respect the type of setting a canal has established in a community.” These planned projects cover Fountainbridge in Edinburgh, from Maryhill through to Port Dundas in Glasgow as part of a 1,000-acre area, and in Falkirk, where there is a corridor of activity from the Falkirk Wheel to the Helix project, a £40m project sponsored by Big Lottery. There are also plans for a project to connect Loch Lomond to the Clyde, by creating a flood defence system and building a canal on top of it.

Why, then, has British Waterways got involved in such regeneration? “We have the responsibility for protecting and restoring the canals, but what we learned from places in England, primarily, places like Birmingham, Liverpool, Leeds, London Paddington basin, where canals were in themselves restored but actually, where wider partnerships were established with communities, what we found was it was very clear that canals can be attractive places.

“As communities are changing and revitalised facing the water, and the people and communities feel the benefit of living next to water, then you begin to realise we have an asset here to generate value and [it] is an attractor, and therefore using that as a catalyst, and certainly in a way that respects the canal side. It’s an asset we want to survive for another 200 years and therefore developing round about it, that will increase usage [and this] is absolutely core to us.” While the use of the canals for leisure is growing, and Dunlop expects to see somewhere between 7-10 per cent growth on the visitor numbers on the canal this year, he also feels there is potential for growth in their traditional role – as a means to transport freight.

“They were originally designed for industrial purposes, [but] freight moved to road and that environment became much greener, and leisure and recreation took a much greater hold, and therefore looking at a canal today compared to 100 years ago, it’s a very different beast.” However, 25 per cent of British Waterway Scotland’s business is freight, and Dunlop says: “We want to promote freight, because our belief is, and it won’t be today, but in five or ten years, when the momentum behind sustainability and the true costs of moving goods across the country [are accounted for], we believe that canals will come back into favour as a tool for moving goods again.” British Waterways is working with universities to model how that might happen in the future.

He says that British Waterways have worked very hard to encourage hauliers to recognise the canals network, and that they are now, following a ten-year programme of loch stabilisation, available for 12 months a year when, previously, canals would shut in the winter for maintenance. “Now, probably for the first time, we can legitimately go to companies and say for 12-months’ operation, you can use this canal for moving goods that are not time sensitive – it can be just in time, but as long as there is a long lead-in time.

This would include goods, whether that’s waste or whether that’s timber or whether it’s a whole raft of other products, [and] that is happening.” A vessel which can carry containerised freight across the Caledonian Canal is being brought over to Scotland from Argentina, and while there is currently, what he describes as, marginal organic growth in freight moved on Scotland’s canals, Dunlop adds: “We want to use that as a model and demonstrate that this is commercially available, and we think if we can do that over a sustained period then the market will grow.”.

British Waterways, at a UK level, is considering the body’s future status, and examining whether it should move from a national corporation to a model similar to the National Trust, as a means of opening up more funding opportunities for their work in England and Wales, where British Waterways faces a funding shortfall not present in Scotland. “It won’t be a quick change, there’s no emergency to it, it’s something we want to think about hard and consult with our stakeholders,” he said. “We have to be very careful that in Scotland that fits with the Scottish Government’s agenda, because we’re clear that the Government has invested heavily, they’re aware of how we deliver against their five strategic objectives, and we wouldn’t want to jeopardise any of that by a change of status.” The organisation in Scotland is in good shape then as it works on turning regeneration plans into reality. “My job is to now create the next British Waterways which takes advantage of that infrastructure, that doesn’t just concentrate on maintaining it but builds upon it, and that’s the kind of team we’re building now,” he said. “We have a wonderful asset, we have a terrific legacy, but now it’s about making a difference with it, creating public awareness and greater enjoyment of it.” In short, he would want to see the impact of the Millennium Link replicated. “We’re very proud to be sitting on one of Scotland’s richest heritage assets, we’re very conscious of the benefits it can bring, and has already brought over the last half dozen years, but it can do much more, and what we want to do is expand that around Scotland.”