Shrewsbury and Newport Canal Trust suffered a major blow when its £25 million lottery funding bid to help pay for the restoration of the old canal was turned down in June.

But Councillor Malcolm Price, who represents the Battlefield and Heathgates ward, today said it would have no knock-on effect for the council’s plans.

“We always said all along that we would resurrect the canal, and we have got no intention to change that.

“It is progressing well. English Heritage is working hard on the Flax Mill (pictured) and the surrounding buildings and an updated announcement should be sent out to residents shortly.”

Council leader Peter Nutting said today the plans would provide a boost for the area.

“The Flax Mill itself is owned by English Heritage, but the council is working with them and what we are going to try and do is acquire the properties around the front along Ditherington, demolish them and open up the setting,” he said.

“If we had a proper garden in front, it would improve the setting tremendously.

“This is all part of the northern regeneration corridor, and we are looking at everything from the sorting office up to the new livestock market, just to see what can or cannot be done.

“No decisions have yet been taken, but a number of planning applications have been put in and we welcome the support of Shropshire County Council.

“If the Flax Mill can be tidied up and redeveloped, we think it will give the whole of that area of town a great boost.”

Councillor Nutting said that it would be some years before the plans come to fruition, and that the recreated section of canal would be unlikely to link into the current waterway.

The borough council has appointed planning and transport consultants Arup, along with a number of specialist sub-consultants, to carry out the study for the northern regeneration.

By Alys Cummings