£15m to give CalMac its routes
back 'a disgrace'
The Herald (David Ross September 21 2007)
After eight years of controversy and more than £15m of public
money, Caledonian MacBrayne yesterday secured the contract to run its
Opposition politicians condemned the long-running saga as a disgraceful
episode, with the public purse paying a fortune to achieve the status
The decision means that the company, which can trace its west coast
ferry roots back to 1851, will have at least another six years transporting
the communities it has served for a century and a half. But CalMac's
subsidy to provide lifeline services on the Clyde to the Hebrides will
increase from around £31m to £43m.
Though the Scottish Government points to increased pension and staff
costs and new vessels as the reasons for the increase, it is also due
to improvements in the service to islands such as Islay, Gigha, Mull,
Coll, Tiree and Arran.
There was disappointment in South Uist where a service to Mallaig was
sought, in addition to the long haul to Oban.
The previous Scottish Executive insisted that tendering was the only
way to justify CalMac's subsidy in accordance with European regulations
on state aid. That is disputed by experts who argued that the European
Court's Altmark ruling in 2003 exempted clearly defined essential services.
The executive said Altmark was not relevant but earlier this year the
European Transport Commissioner said that, as long as a ferry subsidy
complied with the Altmark ruling, the subsidy "would not constitute
state aid". But by then the routes had been put out to tender.
From an original tender list of seven companies only three were invited
to tender. They were CalMac, the ship management company V Ships and
Western Ferries. In February last year Western withdrew and in January
this year V Ships followed suit.
By that time CalMac had gone from one company to seven in a complex
and expensive restructuring process deemed necessary for tendering.
As a result CalMac Ferries Ltd (CFL) will now run the ferries but will
pay Caledonian Maritime Assets Limited for the lease of its vessels
(£10.4m in the first year of the contract) and use of its piers.
That money will then go back to the Scottish Government.
In opposition the SNP had been highly critical and Stewart Stevenson,
the Transport Minister, said yesterday: "I am aware of the strong
feelings around the need for this tender, but completing the process
was the quickest way to protect these vital services for those communities
who depend on them."
Alex Johnstone MSP, the Tories' Shadow Transport Minister, said last
night: "This whole sorry episode shames and disgraces the previous
Liberal Democrat and Labour ministers who presided over years of chaos
and delay since the tendering of these routes was first announced. And
the net result today is that vast sums of taxpayers' money has been
squandered merely to restore the status quo."
Meanwhile, CalMac said it offered to provide a service between Mallaig,
Barra and South Uist using existing vessels and, in addition, to continue
a link to Oban. But a spokesman for the Scottish Government said it
would have meant a reduction in services or a new vessel costing £25m
with running costs of £4m.
But Donald Manford, the Barra councillor who chairs the Western Isles
Council's Transportation Committee, said: "It is extremely disappointing
that the government appears not to have seen the value of the Lochboisdale-