Plans to release British Waterways (BW) from state control have taken a step forward after the government announced it is set to 'mutualise' the organisation.

Alistair Darling, chancellor of the exchequer, outlined the plans in his Budget statement, which is set to see England and Wales' canal network come under the control of a charitable trust. BW has been in discussions with a range of stakeholders over the past 18 months to uncover new models for meeting a £30m shortfall, which the organisation says is "unsustainable".

It is hoped the mutualisation process will allow communities to have a greater say over the running of local waterways, as well as reducing the long-term cost to the taxpayer. BW chair Tony Hales said: "A mutualised canal network will give the communities that have grown up around the waterways since the 18th century an increasingly important role in the way they are run in the future.

"The proposal reflects a widely-held, cross-party and stakeholder view that the waterways are a national treasure which should be moved into the third sector if we are to unlock the enormous public support that there is for them."