There were always problems with water supply, as no reservoirs were built, while the summit section near the tunnel ran through porous limestone, and there were constant difficulties with leakage.

The bid and the project had to be split into smaller sections, but £11.9 million was awarded in 2006 for Phase 1A, which with matched funding has restored from The Ocean at Stonehouse to Wallbridge on the Stroudwater Navigation, and from there to Stroud Brewery on the Thames and Severn Canal.

The Phase 1B reconnection to the national waterways network at Saul Junction is expected to be completed by 2028,[1][2] connecting the Severn with the Golden Valley for the first time in a century.

Since the 1730s, when the first act of Parliament to authorize a canal from the River Severn to Stroud had been passed, the Stroudwater Navigation had been seen as part of a larger plan to link London and Bristol by waterway.

No work took place immediately, but the Stroudwater was eventually opened in 1779, and within two years the shareholders commissioned a survey for a canal from Dudbridge to Cricklade, which would complete the link.

It is likely that John Priddy – previously the engineer for the Stroudwater scheme – carried out the survey, but others were soon involved including Sir Edward Littleton, who was connected with the Staffordshire and Worcestershire Canal.

The canal's summit, which is 362 feet (110 m) above sea level and 8.1 miles (13.0 km) long, includes the 3,817-yard (3,490 m) Sapperton Tunnel, at the time, the longest in England.

The summit level was losing around 1.1 million imperial gallons per day (5,000,000 L/d), largely because the underlying rock was porous limestone, and it was estimated that around half of the daily requirement could actually be supplied.

[12] In a further attempt to prevent water loss, at King's Reach, the section immediately east of Sapperton Tunnel, the canal was lined with concrete rather than puddle clay.

Although it was proposed in 1793, it was not opened until 1810, and the North Wilts Canal, which eventually provided the connecting link from Latton to Swindon for Thames & Severn traffic to bypass the upper river, was not completed until 1819.

Even after this, vessels were restricted by the narrow 7ft width of the North Wilts, which was considerably smaller than the rest of the link between the Thames and the Severn, limiting income from cargo.

[15] Similarly, the Midlands-London traffic that the proprietors had hoped to attract via the Severn found newer routes further east, such as the Grand Junction Canal, considerably more direct.

The line opened to Kemble in 1841, and the tolls on the carriage of materials for the railway's construction improved the financial position of the canal for a short time.

Extensive lobbying in 1979 resulted in Gloucestershire County Council deciding to rebuild a damaged bridge at Daneway, rather than replace it with a much cheaper low-level causeway, which would have severed the route.

[23] In 1991, the trust commissioned the engineering consultancy Sir William Halcrow and Partners to conduct a feasibility study for restoration of the eastern end of the canal.

Andy Stumpf became the full-time Regeneration Programme Manager, working on a major bid application to the Heritage Lottery Fund (HLF) to finance the restoration, and the canal was visited by Charles, Prince of Wales, in his capacity as patron of the Waterways Trust.

[27] Alongside these major developments, the Cotswold Canals Trust has rebuilt a number of locks and bridges and some small sections of the rest of the route are now in water.

Phase 2 covers work at the eastern end of the canal, between Gateway Bridge in the Cotswold Water Park (Cerney Wick), and Inglesham Lock, the junction with the Thames.

A revised plan – with increased support from volunteer labour – aimed to have restoration completed to Bowbridge by the end of 2015, with all major work eastwards put on hold.

[37] The final section of the canal before it joins the Stroudwater Navigation presented particular problems for restoration, as the channel had been used as part of a flood relief scheme by the Environment Agency.

As the project neared completion, open days to allow the public to walk along the bottom of the new canal section were held on 10 and 11 May 2013, and were attended by over 1,800 people.

[41] An official opening of Wallbridge Lower Lock took place on 2 February 2018, when Prince Charles cut a ribbon to celebrate the reconnection of the Thames and Severn Canal with the Stroudwater Navigation, and unveiled a commemorative plaque.

[43] The second phase of the restoration programme covers the length of the Stroudwater Navigation between the Ocean Railway Bridge, Stonehouse, and Saul Junction on the Gloucester and Sharpness Canal, a distance of about 4 miles (6.4 km).

[1] A further boost was the granting of £4 million from Highways England in May 2019, to cover the cost of tunnelling under the A38 roundabout and other environmental projects along the "missing mile", the new route of the canal to replace the section obliterated by road construction and infilling.

[48] Restoration programme phase 2 covers work at the eastern end of the canal, between Gateway Bridge in the Cotswold Water Park (Cerney Wick), and the junction with the Thames at Inglesham Lock, a distance of about 10 miles (16 km).

The section does not pose the major engineering challenges faced elsewhere, but land ownership is an issue, and there are several miles of infilled canal around Kempsford.

[49] In June 2010 the Inland Waterways Association (IWA) mounted a national campaign for £125,000 to enable Inglesham Lock and around 420 yards (380 m) of the pound above it to be restored.

[51] The completion of the project is outlined in phase 3, to connect Brimscombe Port in the west with Gateway Bridge in the east, a distance of about 16 miles (26 km).

[36] Restoring this central section poses several major engineering difficulties: firstly to overcome the water supply that was always inadequate, and secondly because the 2.2-mile-long (3.5 km) Sapperton Tunnel is blocked by two rock falls.

They were built in the 1790s for use by lock-keepers and lengthsmen, but were not particularly popular due to the limited amount of space and problems with finding suitable furniture for a circular room.