We have a cellar that holds water in our 180yr old house. I've
recently had to replace the bottom 3 stairs and the pantry floor
because the timber had rotted due to the water vapour when the cellar
fills up with water(approx 3 inch of water). Cellar is 7 foot deep and
until recently had no air bricks at all and the timber that rotted had
no doubt been there years so it lasted quite long.

I have installed 2 air bricks and replaced the floor and stairs with
treated(tanalised) timber. I used bitumen paint on the ends of the
timber where they came in contact with the damp masonry. This was
maybe 3 months ago and today I went down in the cellar and was rather
shocked to see that the areas of the timber that had bitumen on are
dripping with water and also there is white mould on certain parts on
the timbers?

Is this to be unexpected? surely the timber that I have put in will be
better than the previous untreated timber.