Caledonian MacBrayne (Hansard, 9 June 1993)

§ 8. Mr. Graham
To ask the Secretary of State for Scotland whether he will make a statement about the proposed review by the board of Caledonian MacBrayne at Gourock.

§ Mr. Lang
No review by the board of Caledonian MacBrayne has been proposed. However, the Government have decided to review options for the future organisation and structure of Caledonian MacBrayne, including the possible scope for introducing private sector participation in the provision of Caledonian MacBrayne's services.

§ Mr. Graham
Is the Secretary of State aware that, once again, he has created tremendous uncertainty in the Inverclyde area by the threat of privatisation and possible job losses? There is also a threat to the islanders, who have already stated that they expect privatisation to mean increases in fares, less frequent services and, at the end of the day, islanders once again being driven off the islands and back to the mainland. I know that the Secretary of State was born in Greenock. Another infamous character called Captain Kidd was also born there, and I must say that the Secretary of State will look like a pirate if he continues with this mad stupid policy to privatise any part of the Caledonian MacBrayne services.

§ Mr. Lang
The hon. Gentleman is unfair to Greenock; I was actually born in Glasgow. I hope that he shares my anxiety to remove any uncertainty and alarm among the people who use the Caledonian MacBrayne services. Caledonian MacBrayne provides services to the mainland and 23 islands, and we are committed to maintaining and advancing the economic and social conditions of the islanders. The question at issue is whether the present arrangements are the best way of fulfilling that commitment or can be improved on.

§ Mr. Macdonald
Will the Secretary of State give a commitment that the findings of the Halcrow Fox report in regard to the impact of ferry fares and ferry costs on island businesses will be published and not covered up? Does he recognise that islanders view the prospective privatisation of Caledonian MacBrayne as the poll tax at sea? The last thing that island businesses need at this time is a prolonged period of uncertainty about Caledonian MacBrayne's future.

§ Mr. Lang
The Halcrow Fox study has not yet been completed, let alone submitted to us. There is no question of its being buried away, as the hon. Gentleman implied, and not being taken into account. I know that the hon. Gentleman has tabled a written question, and that will be answered in due course. As to the islanders, I cannot believe that they hold the view of the Caledonian MacBrayne services that the hon. Gentleman describes. The revenue deficit subsidy stands at £7 million this year, and that represents some 18 per cent. of the company's total costs. We have substantially increased shipping subsidies—they now total over £17 million in Scotland as a whole—to ensure that the economic and social conditions of the islands are upheld and advanced.

§ Mrs. Ray Michie
Why is the Secretary of State returning to the matter? We went through it all in 1988, when it was made clear that the privatisation of Caledonian MacBrayne would lead to higher fares, increased freight costs, no cross-subsidies from profitable to unprofitable routes and no back-up vessels being available—all a body blow to the islanders. Will the Secretary of State tell the House how much this latest consultant review is to cost? Does he admit that he is in danger of being pushed around by a london-based Treasury, which does not give a tinker's damn about what happens to the islanders of Scotland?

§ Mr. Lang
I cannot at this stage tell the hon. lady the cost of the survey, since we are still waiting for submissions from the various possible consultants who might be contracted to undertake it. Most of the 1988 review as concerned with the Clyde, whereas what we are reviewing at present is the Caldeonian MacBrayne services to all 23 islands that it serves and also P&O services to Orkney and Shetland, which are privately owned services subsidised by the taxpayer. It is because the cost of that subsidy and the support for both shipping lines have advanced so substantially that we want to make sure that we are using the most effective and efficient way of maintaining our commitment to uphold services to the islands.