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26 June 2008

S3M-2014 Rosyth to Zeebrugge Ferry Service

Scottish Parliament

Thursday 26 June 2008

[THE PRESIDING OFFICER opened the meeting at 09:00]
... ... ...
Rosyth to Zeebrugge Ferry Service

The Deputy Presiding Officer (Trish Godman): The next item of business is a members' business debate on motion S3M-2014, in the name of John Park, on the Rosyth to Zeebrugge ferry service.

Motion debated,

That the Parliament is deeply disappointed to learn of Superfast Ferries' decision to end sailings from Rosyth to Zeebrugge from September 2008; recognises that the ferry link to Europe is vital to the Fife and Scottish economies; notes that the service has been a commercial success regularly operating at full capacity; is disappointed that Superfast does not plan to continue with sailings until an alternative operator is found, and hopes that an alternative operator can be found for this crucial ferry route.

12:36
... ... ...
13:02

The Minister for Transport, Infrastructure and Climate Change (Stewart Stevenson): I commend John Park for his efforts in bringing the debate to Parliament and for the phrasing of his motion, which has enabled the widest possible support on a multi-party basis. It is a model of what a members' business debate can usefully do. In particular, I pick out of the motion the words that sum up the way that we all feel—"deeply disappointed". The disappointment is not just John Park's; it is shared by us all, including me.

In the time that is available, I will attempt to address a range of issues that have been raised in the debate. Before I do so, however, I extend a general invitation. I am happy to meet members—preferably collectively, as that is the most effective way of doing things—to discuss in confidence some of the matters that it would not be appropriate to put in the Official Report of the Parliament, so that we can maintain, from here forward, the clear and useful consensus that has been expressed in the debate. I hope that members feel that that is useful.

We first became aware in January of some issues associated with the service, although at that stage its withdrawal was not on the agenda. We had a couple of meetings with the local management; the first at their behest, the second at my behest. Matters then moved on, and we became aware in April of the plans to close the service. I went with Alan Burns of Forth Ports to visit the owners of the ferry company in Athens. I regret to say that it was the only time that I have been to Greece and I did not leave the airport. I hope to enjoy my next visit there rather more than I enjoyed that visit. We were heard courteously and with good grace, but we did not like what we heard in return.

So we started to take the relevant actions to see what we could put in place to help. We sought to change Attica's mind. We sought as a secondary objective to get it to move the date of withdrawal further back in the calendar—members will know that the last sailing is planned for 13 September. We had no success in that, although we bought some additional time before the announcement, which was helpful in exploring some options.

On the day of and in the hours before the announcement, I had further discussions by telephone with the company owners in an attempt to turn them away at the last moment from the course of action that we now know they are taking. I regret that I had no success.

Dr Richard Simpson (Mid Scotland and Fife) (Lab): Will the minister confirm that the ferry service was a commercial success but did not prove to be sufficiently profitable for the company to maintain it?

Stewart Stevenson: Attica says that the route is commercially viable, and we agree with that assessment. However, Attica has had a number of challenges. Its main interest is as a ship broker rather than a ferry operator, and its trading history shows that in this decade it has sold substantially more ships than it deploys on its ferry routes.

We broadly accept that the Superfast ferries that originally served the route could have proved a commercial success. However, other aspects of the business were perhaps not pursued to best effect. The marketing outside the United Kingdom was minimal and ineffective, with the result that a company whose cost base was largely denominated in euros had an income stream that was largely denominated in pounds. As the exchange rate changed, that caused particular difficulties for the company. Those facts illuminate some of the points that Mr Johnstone and Dr Harvie made on where the most effective companies might reside. Recognising that the route is commercially viable, Attica is continuing to make figures available to others who have an interest in operating the route.

Before drawing to a conclusion, I will try to pick up on some points made by members. John Park referred to Michelin Tyre. A key point is that the daily service enabled it to provide a specific facility. The cut to one ship dramatically reduced the effectiveness of the service, and the situation was not helped by the change to the ship that now sails, which has nothing like the original capacity. In 2004, 41,450 units made the crossing, but in 2007 the figure was 22,552—because of capacity constraint rather than anything else.

Jim Tolson spoke about public money. It is worth pointing out that most of it was a capital investment in shore-side infrastructure, which will be available for any future operation. The waterborne freight grant is still available—€2 million is still to be drawn down. Subject to an application being made by a new operator, I would expect it to be available. The Flanders Government is fully engaged; it approached us and we are having discussions with it.

I acknowledge Cathy Peattie's constituency interest. I have met several of the freight operators in her constituency, and she is right that road miles are important. Chris Harvie said that slower ferries might be more effective. I caution him on that because, on a long crossing such as Rosyth to Zeebrugge, and considering the turnaround times, there are significant difficulties with slower ferries.

Alex Johnstone and I will probably continue to disagree about the future structures of the ferry industry in Scotland, but the Government will consider carefully the report from the Transport, Infrastructure and Climate Change Committee when it is published.

Are companies interested in the route? On the public record, I can say that John White of the NORSHUKON group has indicated an interest, and we are continuing discussions with it. We have basically approached everybody we can think of in this country and elsewhere. We are continuing to engage, and there are still options that may deliver a successful outcome. It will be extremely challenging to ensure that there is no break in service—I want to manage expectations on that—but in the longer term there will be opportunities.

The economic climate is tough, and it is a particularly difficult time for anyone to consider new transport services generally. We are continuing to work with people, and I express again our wish and willingness to work with members who are interested in the subject. Today's debate is not the end of the story, merely a part of it. I hope that the members who have attended it feel that all members of all parties are engaged in the issue and recognise its importance.

13:10

12 June 2008

S3M-2121 Bus Transport [Closing Speech]

Scottish Parliament

Thursday 12 June 2008

[THE PRESIDING OFFICER opened the meeting at 09:15]

... ... ...

Bus Transport

The Deputy Presiding Officer (Alasdair Morgan): The next item of business is a debate on motion S3M-2121, in the name of Des McNulty, on bus transport.

10:24

... ... ...

11:28

Stewart Stevenson: I am not grossly offended by having remarks that Margaret Thatcher made directed at me in the debate. Two members may have quoted her, but I speak as a minister who has been out and about in Edinburgh this week on the number 1, 22 and 36 bus. Heigh-ho—that is how it goes.

Cathy Peattie made some particularly valuable remarks on disability. Both of us share a strong interest in ensuring that disability is not a barrier to participation in transport and wider society. I know of her long-held position on the subject and I agree that there is a big challenge to be met in respect of all transport modes. I am glad that more and more buses are becoming accessible for wheelchair users. That is one aspect of improvement, but we must do more.

Chris Harvie referred to patronage levels in 1983. Interestingly, patronage levels started to rise—albeit slightly—before the introduction of the concessionary fares scheme, so members have slightly misunderstood the issue. There is a complex mix of factors. The preliminary figures for the past few months suggest that, at least for the time being, car usage is falling for the first time in recent history, which presents a challenge and opportunity for buses and other modes of public transport.

On the more environmentally focused BSOG, we seek to reach a situation in which only 25 per cent of what is paid relates to mileage.

Alison McInnes: Will the minister give a date for when the negotiations on that will come to a conclusion?

Stewart Stevenson: I cannot give a date at this stage. We are having positive discussions on the issue with the bus companies and the CPT. We want a scheme that helps companies to improve the quality of their fleets and to move up to the Euro 4 and 5 standard buses that are coming. The proposals are geared to promoting that. We are engaged with the companies and we will make the best progress. We have had comments on partnerships and regulation, on which I will say a little more if I have time.

The Labour motion talks about

"more effective implementation of regulatory arrangements".

We are making real progress on getting people working together, including the police, the Vehicle and Operator Services Agency and councils. The motion mentions the need for resources for regional transport partnerships and councils to complete the bus action plan. Those resources are available, in the increased share of public spending for local government.

The motion expresses concern about fare increases. We should all be concerned about that, but the biggest contributor is undoubtedly the additional tax on the rising fuel prices. People know what can be done about that; I hope that members at Westminster will take it on the chin and do what is required.

The Labour motion highlights through-ticketing. Last week, we announced moves on integrated ticketing. With the completion of the roll-out of new equipment in buses and ScotRail, we are moving ahead on the aim to have one ticket that enables people to access multiple modes of transport. I referred to the discussions that we are having with the Competition Commission, in which we are making good progress.

The point in the motion about

"penalty clauses in rail and ferry contracts"

is a total misunderstanding. There are, in the contracts, no constraints that materially inhibit good connections, although there are significant issues for the industry as a result of other players, such as Network Rail and the charges that it imposes for use of train stations. We are working on that, too.

Are high fuel prices a threat or an opportunity? The answer is that they are both. They are an opportunity for public transport to show what it can deliver. It is rising to the challenge effectively, as there is increased patronage and reduced car use. However, high fuel prices are also a threat in that they put pressure on the cost base, which is an issue that we will need to watch carefully. In reviewing the concessionary travel scheme, we are continuing measures that our predecessors put in place. We support the Green amendment, because improved regulation has a role. Mr Johnstone should note that we have far from bought into the idea that everything that is good in buses stems from the deregulation that the Tories introduced.

11:34

S3M-2121 Bus Transport [Opening Speech]

Scottish Parliament

Thursday 12 June 2008

[THE PRESIDING OFFICER opened the meeting at 09:15]

... ... ...

Bus Transport

The Deputy Presiding Officer (Alasdair Morgan): The next item of business is a debate on motion S3M-2121, in the name of Des McNulty, on bus transport.

10:24

... ... ...

10:38

The Minister for Transport, Infrastructure and Climate Change (Stewart Stevenson): As members have said, the recent substantial increases in fuel costs present us with challenges, but they are also an opportunity to highlight bus travel—particularly to current non-bus users—as an efficient and effective alternative to many car journeys. I am encouraged by the work that is being undertaken by a number of local authorities in conjunction with bus operators. In particular, the recently publicised work by Glasgow City Council to move towards a statutory quality partnership is an encouraging example of what can be done.

On the subject of the regulated environment, I note the success of London Buses in its heavily regulated environment. I am confident that the successful companies in Scotland would have been equally successful operating in that regime. That is what they are good at.

I and my ministerial colleagues are considering the future levels of bus service operators grant. The budget for BSOG is around £61 million in 2008-09—£4 million more than was allocated in the strategic spending review. We are working with the industry to restructure the grant so that it becomes more environmentally focused and we are making good progress. In passing, I observe that Labour in Wales has followed exactly the same path as we have in Scotland.

We are working with the Office of Fair Trading to develop guidance on bus competition. It has given us to understand that bus companies can discuss subjects of joint interest, but not prices, when such discussions are carried out under the oversight of a third party, such as the local transport authority. In due course, we will write to the CPT and the bus companies to apprise them of the results of our discussions.

We are also working with the traffic commissioner for Scotland to ensure that the regulatory regime operates efficiently and effectively for bus users. As part of that activity, joint working arrangements have been developed across Government specifically to target non-compliant bus operators. The police, the commissioner and other parties are also involved, and Strathclyde Partnership for Transport has also played a valuable part by providing staff resources to gather evidence of non-compliance and punctuality failings. I encourage other local transport authorities to consider whether they can provide similar support.

In line with commitments that the previous Administration made, we will start the major review of the Scotland-wide free bus travel scheme for older and disabled people next week. It will review eligibility criteria, delivery arrangements, funding and legislation. I take the opportunity to correct the motion: subsection (v) of section B of part 4 of the form for applying for a pass concerns mental health issues; the form to which that subsection refers—the certificate of eligibility, which can be signed by a wide range of people—clearly covers learning disability, so it is clear that learning disabled people are already inside the scheme. As we go forward, we will consult stakeholders. We have already written to a wide range of equality groups to invite their views on the current operation of the scheme.

The Scottish Government recognises the essential contribution that the bus industry makes and has provided £280 million this year for buses. We have also provided local government in Scotland with record levels of funding and increased its share of Government funding. To encourage more people to consider using buses, we need to drive up quality; we will support efforts that do that. Buses are an important part of the transport solutions that we need to deliver on our climate change agenda, and the Scottish Government will continue to support them.

I move amendment S3M-2121.1.1, to insert at end:

"notes that increasing fuel costs present a significant opportunity for bus transport to demonstrate that it is an efficient and effective alternative for many car journeys, and condemns the failure of the Westminster government to respond to the sudden increases in the price of crude oil which are bringing uncertainty to a wide range of businesses and domestic users of oil and putting at risk the positive developments in the bus industry in recent years."

10:42

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