The CalMac Fiasco - Comment

The Herald and its correspondent David Ross ("Executive was sidelined over CalMac bids", 16th February) have done an excellent job of shedding light on what the editorial on the same day rightly headlined as the "Ferry tendering fiasco".

I gave invited evidence to the Scottish Parliament's Inquiry on the issue, and in the Spring of 2005 I submitted a proposal to the Committee and the Executive based on the Altmark ruling by the European Court. The proposal showed how basic principles outlined in the Altmark case could enable CalMac's lifeline ferry services to be made compliant with EC rules without the need for tendering.

The proposal was supported by many members of the Scottish Parliament, and also endorsed by leading legal experts in the field. The then Transport Minister Nicol Stephen promised the Transport Committee that I would be given an opportunity to discuss my proposal with the Executive.

That never happened. Instead, just before the debate in the Scottish Parliament in September 2005, a briefing document appeared from the Scottish Executive which attempted to discredit my proposal on spurious grounds, the central argument being that Altmark was not relevant to the tendering of Scottish lifeline ferry services. I was not consulted, and i was given no time to correct the grievous errors in the report before the Parliament voted in favour of the Executive's case for tendering CalMac services. Many MSPs said they voted in favour because they saw no real alternative.

Last month the EC's Commissioner Barot confirmed in response to a question from Alyn Smith MEP that the Altmark principles were not only relevant to the question of ferry services like the CalMac network, it was essential that the Altmark principles be complied with if subsidies to these services were not to be treated as illegal State aid. It is now absolutely clear that Altmark-based alternatives to tendering such as mine had been dismissed on spurious grounds.

It was widely thought that it was incompetence on the part of the Executive that led to reasoned alternatives to CalMac tendering being dismissed. While incompetence may still be a factor, it now seems that impotence was also a central issue. As the Herald has so clearly shown, the real decisions and representations to Brussels are still made by the relevant Whitehall ministry, and tendering is the default and obvious solution there. Why should Whitehall-based civil servants go to the trouble and inconvenience of working on and representing a novel solution for a part of a region of the UK about which they know very little, and care even less? Especially when they do not have to account for their decisions, and someone else takes the flak and endures the consequences.

We do not know how hard the Executive's civil servants tried (if at all) to argue alternatives to tendering, but in the end it would have made no difference. It is clear from what the Herald has uncovered that when the Scottish Minister of Transport goes to Brussels (and indeed Whitehall) he is treated as a daytripper, not a policymaker. If Commissioner Barrot had given him a souvenir pen of his last visit to Brussels, at least he would have had something to show for it.

But it gets worse. Much like the US's never-ending political campaigning, no sooner does one tendering cycle stop than the next one begins. It has taken seven years (and counting) to set up the first tender for the CalMac network, but the tenders are for a maximum of six years. Clearly (one would hope) CalMac and the Executive will be able to draw on some experience built up over the past few years, but if CalMac wants to win the tender after this one, it will have to start planning for that bid not long after it has started the present tender. A sort of multi-million pound seaborne Groundhog Day which will have the side effect of crowding out any hope of thinking about such off-agenda items like economic development.

The Herald editorial commented "Shambles? Fiasco? Neither is too strong a term". I fully agree.

Neil Kay February 16th 2007