§ 1. Mr. Barry FieldTo ask the Secretary of State for Scotland how many ferry companies in Scotland receive subsidies from public funds.
§ The Parliamentary Under-Secretary of State for Scotland (Lord James Douglas-Hamilton)The Scottish Office provides subsidies to two ferry companies in Scotland: Caledonian MacBrayne Limited and P and O Ferries Limited. In addition, some local authorities subsidise ferry operations.
§ Mr. FieldDoes that answer not show not only the Government's strong commitment to the Highlands and Islands, but the generosity of United Kingdom taxpayers, some of whom live on the Isle of Wight and travel to and from the mainland in unsubsidised ferries, paying the full fare out of their own pockets?
§ Lord James Douglas-HamiltonI should mention that this year the provision is for a £6.5 million subsidy to CalMac, to cover its deficit in providing approved services, and for a £4.1 million subsidy to P and 0 Ferries, to reduce fares to the Orkney and Shetland islands. There are about 100,000 persons living on about 75 Scottish islands, many of which have to be reached by long, difficult and stormy journeys. For example, the journey to Lerwick takes 14 hours. We have a commitment to maintaining that subsidy.
§ Mr. MacDonaldWill the Minister confirm that Caledonian MacBrayne receives large amounts in assistance from the European Commission towards the construction costs of new ferries and piers, and that such assistance would not be available if it were under private ownership?
§ Lord James Douglas-HamiltonIt is certainly the case that the ERDF subsidy is received by Caledonian MacBrayne at present, and it is not at all clear whether it would continue under a different system. My right hon. and learned Friend the Secretary of State for Scotland is considering future arrangements for CalMac following his decision to privatise the Scottish Bus Group. He has commissioned the Scottish economic consultants Pieda to advise him in that respect. Whatever structure is adopted, it will guarantee the best quality of service, which the islanders rightly enjoy.
§ Mr. Buchanan-SmithWe very much welcome my hon. Friend's statement that the situation of ferries serving the Western Isles and the northern isles of Scotland is quite different from that of ferries serving other areas of the United Kingdom, and his commitment to them. Will he go a little further and say that he will ensure that in any privatisation proposals the special position held by those services, and the way in which they are viewed by the communities they help, will be fully taken into account?
§ Lord James Douglas-HamiltonYes. Whatever proposals may eventually be put forward will ensure the best arrangements possible. In our election manifesto we pledged to continue the substantially increased financial support and upgrading of ferries and terminals that are so vital to the islands. When I met the STUC and the joint shipping services advisory committee, I acknowledged that those services are a lifeline to the islands.