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The Economist
The Economist
5 Aug 2023

NextImg:What broken ferries reveal about Scotland’s government
Britain | Ferry bad indeed

What broken ferries reveal about Scotland’s government

A sorry tale of mismanagement and waste

WHEN OVER one-quarter of your population turns out to protest, something is seriously amiss. In June some 500 of the 1,900 residents of South Uist, a remote spot in Scotland’s Outer Hebrides, showed up to demonstrate over their island’s wretched ferry service. For much of that month their vital connection to the mainland had been cancelled, one of a long-running series of transport problems for Scotland’s coastal settlements. Even mainlanders are concerned: in June hundreds marched in Glasgow to urge compensation for islanders.

Ferry disruptions are costly. Island economies suffer when tourists are kept away, or goods become harder to ship in and out. In some cases supplies of food and other basics have run short. In August 2022, after supplies from the mainland were cut, shops in South Uist were forced to impose wartime-style rations, limiting customers to one carton of milk and a loaf of bread. Frustrated residents on Mull and Iona, two other islands, want to launch their own community-run boat services.

Some 90 inhabited Scottish islands rely on ferries for cargo and passenger travel. But in recent years the propellers have been coming off. Last year technical faults forced the government-owned Caledonian MacBrayne (CalMac)—which serves over 50 ports and harbours along 200 miles of Scotland’s western coastline—to cancel 1,830 sailings, a 70% rise from 2019. Its ferries were on time on just 31 days in the year. Transport Scotland, the regulator, slapped it with fines worth £3m ($3.8m).

What has gone wrong? Ageing fleets are the main problem. Older boats need more maintenance and break down more. When the pro-independence Scottish Nationalist Party (SNP) came to power in 2007 the average CalMac ferry had been in use for 17 years. That has since risen to a geriatric 25. Two new boats promised to CalMac are now five years late, and are expected to cost three times more than their original “fixed” price of £97m. And lack of capacity means that, when a boat breaks down, there are no spares to use in its place.

All this reflects badly on the SNP. Just one-fifth of Scots think the government is managing the ferries well. “It’s one of those policy-delivery issues where the government seems to have come unstuck,” said Mark Diffley, a researcher at Diffley Partnership, a consultancy in Edinburgh. In April it emerged that Ian Blackford, the SNP’s former leader at Westminster, had asked the British Ministry of Defence temporarily to help manage the network. Such requests are normally reserved for emergencies.

The Scottish government’s response has been to dish out more taxpayers’ money. Two decades ago CalMac received £25.9m (around £42.8m today) in annual operating subsidies, some 30% of its gross revenue. By last year that had risen to £157m, or 70%. Yet results are thin on the ground. “Investment is not the problem; the problem is it is spent very badly,” Dr Alf Baird, a former professor of maritime business at Edinburgh Napier University, told a recent government inquiry.

The extra subsidies were required in part because eight years ago the Scottish government obliged operators to charge users cheaper fares. That boosted ferries’ use just as the cost of fuel and labour began to grow. CalMac’s maintenance costs have also risen, from £9.5m in 2011 to £26.5m last year. In all, the government has awarded the operators a £700m budget to overhaul the ferry service. Two-thirds of CalMac’s fleet is supposed to be replaced by the end of the decade. But that looks unlikely: no new boat has been built since 2017.

A complex network of parties oversees Scotland’s ferries, including Transport Scotland and CalMac, the operator, and Caledonian Maritime Assets Ltd (CMAL), which owns the ferries and infrastructure. (Ultimately, the government owns both CalMac and CMAL.) A parliamentary inquiry in June identified a “pass-the-parcel of responsibility culture” leading to waste and bad decision-making. CMAL’s boss, Kevin Hobbs, rejected the criticism.

The SNP’s nationalism has at times eclipsed its competence. One week before an independence referendum in 2014 Alex Salmond, then first minister, persuaded Jim McColl, a billionaire ally of the SNP, to buy Ferguson Marine shipyard—an emblem of Scotland’s shipbuilding heritage. The shipyard subsequently secured an order for two new ferries from CMAL, despite submitting the most expensive bid and failing to provide a mandatory repayment guarantee if the ships were late or the shipyard went bust. It absorbed £45m in loans before going bankrupt in 2019; it was subsequently nationalised. Documents recently obtained by the BBC suggested the shipyard had enjoyed preferential treatment when submitting its bid.

CMAL has said that an audit in 2018 found “no adverse issues” with the procurement. And ministers have refused to ditch the project: in June they vowed to keep building one vessel at Ferguson to protect its workers, even though an official review suggested it would be cheaper to buy the boat elsewhere. Meanwhile the government is refusing to publish an official assessment of whether Ferguson offers value for money.

All this is awkward for the first minister, Humza Yousaf. Mr Yousaf served as minister for transport and the islands between 2016 and 2018, though would prefer it not to be mentioned. In May he suggested privatising the beleaguered shipyard, to unions’ outrage. In June he restored the transport brief to cabinet level, after his transport minister quit. Polls suggest the SNP faces a mauling at the next British general election, which must be held by January 2025. The ferries saga has done nothing to strengthen the case for Scottish independence—but has surely made it likelier that voters will throw the SNP overboard.

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