CalMac fails to tender for route

DAVID ROSS, Highland Correspondent November 14 2006

No-one has bid to run the first of Caledonian Mac-Brayne's routes put out to tender, not even the publicly-owned CalMac itself, it emerged yesterday.
The Scottish Executive's management of the Gourock-Dunoon tender is also being bitterly denounced by Western Ferries, the leading private-sector player, after the company and CalMac said they could not run the route on a commercial basis.
Western Ferries is now threatening to report the matter to Audit Scotland and is taking legal advice about what it believes has been unfair treatment by ministers and officials.
Opposition politicians have described the matter as a shambles and called for an investigation into the way the exercise was carried out.
No subsidy was on offer for the route, but now the executive has been forced to consider a new subsidised service.
All this comes just weeks before the remainder of CalMac's 26 Clyde and Heb-ridean services go out to tender as one bundle to justify their subsidy, which many observers believe will attract a bid only from CalMac.
But Gourock/Dunoon had special features. Since the early-1980s, CalMac has received a subsidy to carry pedestrians between Gourock and Dunoon, using a car ferry and a passenger vessel.
Western Ferries has operated a commercial car ferry service between Hunter's Quay and McInroy's Point, a couple of miles from Dunoon and Gourock, since 1973.
Because Western received no subsidy, ministers decided to level the playing field by restricting CalMac to one crossing an hour, except at peak times, resulting in Western, which runs up to four times an hour, securing an 80% share of the lucrative vehicle market over the past two decades.
The executive invited three companies to tender: CalMac, Western Ferries and V Ships, which withdrew in September.
Yesterday the other two confirmed they had done likewise. CalMac managing director Lawrie Sinclair said it was impossible to run the service specified without a subsidy.
CalMac had incurred a loss of £2.5m on this route in the past financial year. There would be no redundancies and in the meantime CalMac would operate its service.
Meanwhile, Gordon Ross, Western Ferries' managing director, said: "Western Ferries are deeply concerned by the way the executive has conducted this particular tender.
"For instance, the executive must have been aware of the financial realities before the process started – if any operator was to replicate the current service, the projected fares would have to treble just to break even.
"Information issued by the executive was inconsistent, subject to alteration and delay. The critical carrying and financial information was available to CalMac from the start of the tender process, but it took Western Ferries 11 weeks to receive it. Moreover, if all the information had been made available at the start of the tender process it would have been very possible that Western Ferries would have withdrawn earlier."
The company was now discussing its next steps, "which may include submissions to Audit Scotland, as it believes no other company should be exposed to this level of unfairness and bias as part of any future procurement process. We do not make such criticisms lightly."
However, an executive spokesman said: "We do not accept the criticism of the tendering process voiced by Western Ferries."