Scotland ferries scandal: Privatisation ruled out for ferries after critical report

West coast ferry services will not be privatised following the publication of a report that examined the possibility, the transport minister has announced.

The long-awaited Project Neptune report, undertaken by consultancy giant Ernst and Young, issued scathing criticisms of the existing governance structure for the lifeline island ferry services.

It criticised an “absence of long-term planning”, with a “sub-optimal” approach to the maintenance and replacement of vessels, potentially causing “higher than necessary or unforeseen maintenance costs”.

This, the report concludes, “presents operational challenges and is unlikely to represent best value”.

Ferry services on the west coast of Scotland operate within a tripartite system involving Transport Scotland, the ferry infrastructure body CMAL, and the ferry operator CalMac.

The report was commissioned to examine the possibility of privatising the system, paving the way for private operators to take over existing routes, including ports and procurement of vessels.

Announcing the first steps towards reforming the system, with no deadline placed on when final decisions will be made by, the transport minister rejected the possibility of privatisation.

Transport Minister Jenny Gilruth released the results of the Project Neptune report into the ferries system.

Jenny Gilruth told MSPs: “The report sets out a range of potential options for reform.

"The First Minister has been absolutely clear that we would not consider unbundling or privatisation and the report sets out some of the reasons why that would not be pursued in further detail.

"Alongside improving existing arrangements, I’m open though to what improvement could result from more formal integration.”

The report states privatisation scored poorly on future passenger experience, deliverability, accountability and transparency, and was given the worst score on the overall potential to achieve best value.

The two options of integrating CMAL with CalMac was viewed most positively, but Ms Gilruth said a consultation period with island communities would lead reform.

However, despite significant concerns around the age of the CalMac fleet, there was no announcement on new vessels.

In answer to Tory MSP Jamie Greene about potential replacement ferries, Ms Gilruth said she hoped to say more in coming weeks.

She said: “I’m not able to say publicly where we are in that respect. However, I am hopeful that in the coming weeks we will be able to say more.

"As we go into winter, I recognise there is a level of anxiety in our island communities and I want to give them a reassurance.”

Scottish Labour’s transport spokesperson Neil Bibby said it was “disappointing and not surprising” the statement did not include a stronger commitment to new ferries.

"The serious problems with Scotland’s ferries have gone on far too long and ultimate responsibility lies with the Scottish Government,” he said.

"We cannot afford to make a bad situation worse and that’s why Scottish Labour welcomes the commitment to rule out privatisation and the unbundling of routes on the Clyde and Hebrides network.

"The Scottish Government cannot distract us from the fact islanders have an unreliable ferry service, mainly because we have an unreliable ferry fleet.”

Graham Simpson, the Scottish Conservative transport spokesperson, said it would be “hugely beneficial” for cross-party agreement to be reached on the future of the ferry service.

He said: “The clunky governance structure should change. It doesn’t make sense to have the minister, Transport Scotland, CMAL, and CalMac, it is not delivering for islanders.”

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