§ Mr. Corrieasked the Secretary of State for Scotland what action he proposes to take, following the response that the Scottish Transport Group has made to the Monopolies and Mergers Commission's report, published on 23 February, on Caledonian MacBrayne Ltd.; and if he will make a statement.
§ Mr. YoungerThe group, of which Caledonian MacBrayne is a subsidiary company, has considered the report and has prepared a response, copies of which I am placing in the Library of the House. The response demonstrates the group's ready acceptance of most of the commission's recommendations and the not inconsiderable action that has already been taken to implement some of the recommendations. I welcome the group's positive response to the report so far. My Department will continue to monitor developments and I shall make a further statement next year on progress on all the outstanding issues which require further consideration by my Department and the group.
The commission made one public interest finding, concerning the relationship between Caledonian MacBrayne and another of the group's subsidiaries, MacBrayne Haulage. The group has taken prompt action to remedy this situation, and the detail is set out in its response. In the light of this I do not propose at this stage to make an order under section 12 of the Competition Act 1980. My Department will, however, continue to monitor this particular situation, and I will henceforth require the company's auditors to certify annually that the relationship between the two subsidiaries is maintained on an arm's length basis.
The commission makes important recommendations about the company's financial management, and steps are being taken which should result in substantial improvement in financial control and performance. Further discussions will be required on some of the recommendations designed to improve operating efficiency. Where implementation of any recommendation would require the withdrawal of a service, there would be full opportunity for objections to be heard by the Transport Users Consultative Committee for Scotland.
The commission gave close attention to the company's capacity for investment appraisal of proposed new expenditure. This is a matter of the greatest importance if 403W taxpayers' money is to be used properly and a shipping service provided that is fully cost-effective. My Department is in close contact with the company at present over the relevant recommendations.
The commission devoted a substantial part of its report to consideration of the appropriate basis for determining fares and tariffs on Caledonian MacBrayne's network. Its recommendations in this respect are important and fundamental. My Department and the company are engaged in detailed discussion and examination of the issues raised, and further time is required for this exercise. The discussions include consideration of the future of commercial vehicle discounts.
The commission found that the service provided by Caledonian MacBrayne was of a high standard. I am happy to endorse this finding. The commission also made a number of recommendations concerning the role and efficacy of the company's arrangements for consumer representation. Further consideration is required in this area, but I am content that substantial progress has already been made, as set out in the group's response.
The group has, in response to one of the commission's recommendations, now appointed a full-time chief executive, who has been recruited from the private sector. I have also recently announced a new part-time appointment to the group board of a candidate who brings with him considerable shipping expertise. I am confident that these appointments will greatly assist the company in consolidating the action already taken and in continuing to improve the company's performance in the future.
I am grateful to the Monopolies Commission for this thorough and constructive study. It is already leading to considerable improvements in Caledonian MacBrayne, to the benefit of all its customers.
Home helps (full-time equivalents) All figures per 1,000 head of population Number of home helps Region 1976 1977 1978 1979 1980 1981 1982 Borders 1.3 1.0 1.0 1.3 1.0 1.0 1.1 Central 1.7 1.4 1.0 1.6 1.5 1.5 1.6 Dumfries and Galloway 2.1 2.1 1.9 1.8 2.3 2.2 2.2 Fife 1.5 1.3 1.2 1.5 1.6 1.5 1.5 Grampian 1.3 1.2 1.2 1.2 1.2 1.2 1.2 Highland 0.7 0.9 1.0 1.1 1.1 1.2 1.2 Lothian 2.3 2.0 2.1 2.2 2.4 2.3 2.2 Strathclyde 2.0 1.8 1.8 2.0 2.0 1.9 2.0 Tayside 1.3 1.3 1.2 1.3 1.3 1.3 1.3 Orkney 5.2 3.9 3.5 3.4 3.8 3.6 3.2 Shetland 3.5 2.9 2.6 2.2 2.5 2.3 2.0 Western Isles 5.5 4.6 4.6 5.1 4.6 3.2 4.5 SCOTLAND-TOTAL 1.8 1.7 1.7 1.8 1.9 1.8 1.8