19th September 2018
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Deal to buy vessels as Northern Isles contract is extended

A deal has been agreed for the three passenger ferries serving the Northern Isles to be bought outright by Caledonian Maritime Assets Ltd (CMAL), with loan funding from the Scottish government.

The Hamnavoe, Hrossey and Hjaltland – previously leased from Royal Bank of Scotland – will be taken into CMAL ownership.

An 18-month extension to the current Northern Isles ferry contract has also been agreed.

Transport Scotland says that is to allow further progress to be made with the ongoing review of procurement policy.

It means Serco NorthLink Ferries will continue to operate the services until 31st October 2019 under the extended contract.

Minister for Transport and the Islands Humza Yousaf said: “This agreement to buy the three passenger vessels serving the Northern Isles is an excellent piece of business for the Scottish government.

“Not only does it secure the future of the three vessels that had previously been leased, but it will also deliver savings to the public purse in the longer term.

“We have also agreed an extension to the current Northern Isles contract, which will see Serco NorthLink Ferries continue to run the service until the end of October 2019 under the extended contract.

“This is a continuation of the current agreement, so there will be no reduction in services. This will allow us to make further progress with the review of procurement policy for future ferry operating contracts.

“Our ferry services are iconic transport links that play a vital role for our island economies. Making sure they continue to support the communities they serve, as well as delivering best value for taxpayer’s money, will always remain at the heart of our ferry operations.”

NorthLink’s managing director Stuart Garrett said: “We are pleased to have been awarded this contract extension and we will be working closely with the Scottish government and CMAL as the ownership of the passenger vessels is transferred.

“We have a positive history of working with CMAL and look forward to continuing to deliver this service with business as usual during the contract extension.”

3 comments

  1. Ali Inkster

    Excellent that means we can look forward to a lack of cabins and an inability to get in and out of aberdeen with any kind of weather for many years to come. This may be an excellent piece of business for the scoti government but it is bad news for us.

    Reply
    • John Tulloch

      Yes, it seems odd that, having lambasted Tavish Scott for his involvement in bringing about the use of these vessels, the SNP Scottish government has now bought them.

      One of the criticisms made was that the vessels’ design causes them to use grossly excessive amounts of fuel, compared to other designs, e.g. Pentland Ferries catamarans.

      Fuel is a major component of vessel running costs so hopes of cutting costs and hence fares by improving efficiency appear to have been dashed by this move.

      It presumably also rules out companies like Pentland Ferries who run their Orkney-Caithness operation without subsidy, in competition with NorthLink, from entering the bidding for future contracts, which now have the look of becoming a “shoo-in” for nationalised group Cal-Mac. Very cosy.

      However, for users and taxpayers, that would be the worst of all possible worlds.

      Reply
  2. steven Jarmson

    I note the comment by the Secretary, “This is a continuation of the current agreement, so there will be no reduction in services.”
    Does this mean a reduction in services is being considered in the future?

    Now the Glasgow and Central Belt Government will own the ferries, can we expect refits to extend the cramped cabins and provide more of them? Doubtful.
    Also, since there will be a cost saving year on year, surely we’ll get a reduction fares??
    Also, doubtful.

    Reply

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