Biggart Baillie Solicitors

Scottish Ferries Review - An Update

Thursday, July 29, 2010

by Neil Amner

The Scottish Government conducted a high level Review of ferry services, the Consultation as a result of that Review has now commenced.  Biggart Baillie has prepared the following summary of the main points of the Review and Consultation. 

Context

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 coincided 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, were at that time 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.  Although the EU Commission’s investigation has now been completed, the Review objectives (as referred to below) still have merit. 

The Commission determined that the public service obligations for the Western and Northern islands were legitimately defined and entrusted on the operators, with the exception of the Gourock-Dunoon route.  In the case of this route, the Scottish Government have committed to take the necessary steps to launch a public tender for its operation. The subsequent public service contract should enter into force before end June 2011.

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Objectives

The stated intention of the Review was 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.”

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Timings

The Review has been completed and a proposed Strategy has now been published in the form of a public Consultation.  It is understood that after the Consultation exercise has been completed, a document will be published that clearly states the Scottish Government’s long-term Strategy for ferry services in Scotland.

The Consultation period is from 11 June to 30 September 2010.  Following the Consultation period a Draft Ferries Plan will be produced, which will be subject to a further 6 week public consultation.  The Strategy will be written to 2022 in order to tie-in with the date for renewal of the Strategic Transport Projects Review.

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Process

The Review has been led by the Scottish Government’s Ferries Division within the Transport Directorate.

In preparing the Review the Ferries Division and its consultants liaised 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.

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Scope

The scope of the Review when it was announced was to cover all publicly funded ferry services and to 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;
• 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 scope specifically excluded the following:

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

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Consultation

The Consultation is split into a series of chapters dealing with different aspects of the Review.  These include three wide questions on: -

• How ferries should be funded and procured;
• What kind of ferry services should be funded; and
• Who should be responsible for providing ferry services.

Under each of these chapters the current position is explained and future requirements and options for the future are examined.

There is also a chapter on fares examining the different options including road equivalent tariffs. The final chapters look at Accessibility and Environmental issues.

The Consultation asks 33 specific questions under the above six chapter headings.

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Should you have any queries on the Review or the Consultation, 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 8001.