Biggart Baillie Solicitors

Ferry Services Review - A Summary

Wednesday, September 10, 2008

The Scottish Government has commenced a high level Review of ferry services.  Biggart Baillie has prepared the following summary of the main points. 

Should you have any queries on the Review, or if you have a query relating to the current regime, please contact Neil Amner for an initial discussion and indication of whether fuller advice might be appropriate on namner@biggartbaillie.co.uk or 0141 228 8000. To find out more about Neil, click here.

Why?

The Scottish Government committed to a Review of ferry services as part of its National Transport Strategy 2006 and intends to use the Review to inform its long-term Ferries Strategy (the “Strategy”).  The Review coincides with the EU Commission’s investigation into subsidies to CalMac Ferries Limited and NorthLink, which commenced in May 2008.  These services, which are vital to the viability of many outlying communities, are once again the focus of a debate between those in favour of publicly subsidised operators, those in favour of a market thrown open to competition and all opinions between.

The stated intention of the Review is to:

• "Develop a shared vision and outcome for lifeline ferry services in Scotland;
• Identify how well the present services and network meet the proposed outcomes and how they link to other modal networks;
• Inform the Strategy for lifeline ferry services in time for the next spending review and influence the next round of procurement of ferry services and supporting infrastructure; and
• Identify policies to be taken forward to deliver the Strategy.”

When?

Once the Review has been completed and a proposed Strategy agreed upon by the Scottish Ministers, that Strategy will be published in the form of a public Consultation, expected to be carried out between June and August 2009.  After the Consultation exercise has been completed, a document will be published that clearly states the long-term Strategy for ferry services in Scotland.

The Strategy will be written to 2022 in order to tie-in with the date for renewal of the Strategic Transport Projects Review.

Who?

The Review is to be led by the Scottish Government’s Ferries Division within the Transport Directorate.

How?

During the Consultation, the Ferries Division will liaise with operators, passengers, local authorities and communities by means of:

· On-board passenger surveys;
· Workshops with island and other, relevant communities; and
· Surveys of island residents.

Scope

It is proposed that all publicly funded ferry services are to be included in the Review, which will address the following issues:

• Responsibilities - The “split” of responsibilities between Scottish Government, Local Authorities, ferry operators and Caledonian Maritime Assets Limited (the owner of a number of the harbours served by the Clyde and Hebrides ferry services and vessels);
• Services - Procurement of lifeline ferry services.  The Review is to consider opening routes up to competition from private ferry service providers and will assess whether the present “bundling” of routes should be maintained;
• Infrastructure - Investment required in port infrastructure to support the routes and services recommended by the Review, including “how ports and harbours should be funded and run”;
• Vessels – Vessel requirements, including replacement and future investment, to support routes and services recommended by the Review;
• Fares - Fare structures and whether fare adjustments could be used to support the more vulnerable island communities;
• Funding - Different funding mechanisms for ferries and the affordability of lifeline ferry services to the Scottish Government.  Initial findings on higher cost items such as ports and vessels will be included in the spending review anticipated for Spring 2009;
• Emissions - from ferries and the availability and cost of fuel as well as alternative fuels;
• Alternatives - Alternatives to ferry services such as tunnels, bridges and causeways;
• Air - The relationship between lifeline ferry services and lifeline air services;
• Freight - The commitment contained within the Freight Action Plan 2006 to take full account of “the freight requirements of businesses and communities”;
• Northern Isles - The Northern Isles lift-on lift-off (lo-lo) freight contract awarded in May 2008; and
• Jura - A shorter route between Jura and the mainland will be specifically considered.

The Review specifically excludes the following from its scope:

• Detailed timetabling and costing work;
• Detailed work on alternatives to ferry services;
• The issue of whether or not to create a Ferry Regulator.