> I can't read the label as it's faded due to numerous visits to the washing machine.
Since you've probably used normal detergent washing powder, the fabric will now have a nice hydrophilic coating, encouraging water to be absorbed into the fabric. After all, that's what you want to happen when you wash something. Rinsing won't remove this, but a wash in a pure soap product might.
Polycotton isn't the greatest of water resistant fabrics, and will tend to absorb water.
> Is there some sort of spray on coating that will make it waterproof again.
Spray treatments won't make it water<i>proof</i> (i.e. resistant to a hydrostatic head, aka water pressure), but might improve the water resistance. This will reduce the amount of water the fabric soaks up, or increase the time before it does start to soak in.
> Incidentally it is also lined so a wash on sort of idea probably won't work.
What is it lined with? It might be perfectly okay to make this water resistant, too, to stop it absorbing water.