8 Conclusion: How has RET contributed to Government policy?

Overview

RET was ultimately introduced to contribute towards the transport and wider social and economic policies of the Scottish Government. In this respect, its success can be measured in terms of how it has contributed towards its original investment objectives, which were to:

increase demand for ferry services by making ferry travel more affordable and accessible
increase tourism and supporting existing tourism markets
enhance local economies and the wider national economy

The wider government policy context is also evolving at present, with a range of new strategy documents emerging to guide transport, economic and islands development in the medium-term. Whilst RET cannot be evaluated against these new strategies as it predates them, there is benefit in ‘stress-testing’ the policy outcomes against the emerging policy context – this has been done through:

assessing how RET has contributed towards the headline government policies for
transport, as expressed through the National Transport Strategy
the economy, as expressed through Scotland’s Economic Strategy
islands, as expressed through the National Islands Plan
Scotland as a whole, as expressed through the National Performance Framework, which records how all areas of government are contributing towards the Government’s Purpose of, ‘creating a more successful country, with opportunities for all of Scotland to flourish, through increasing sustainable economic growth’

In keeping with the summary nature of this report, the policy assessment is relatively high level, adopting a seven-point scale with supporting commentary to assess how RET has contributed to each policy component. The seven-point scale is as follows:

- highly positive contribution

- moderate positive contribution

- slightly positive contribution

– no impact

- slightly negative contribution

- moderate negative contribution

- highly negative contribution

How has RET performed against its original objectives?

In devising the RET fares policy, the Scottish Government set three objectives which they expected the policy to deliver – the extent to which this has been the case is set out in the table over the page:

Table 8.1: How has RET performed against its original objectives?
RET objective	Assessment	Comment
Increase demand for ferry services by making ferry travel more affordable and more accessible.	highly positive contribution	Demand has increased across almost all routes on the network, with a significantly larger number of island residents and visitors using the CHFS ferries than prior to the introduction of RET.
Increase tourism and supporting existing tourism markets.	moderate positive contribution	The observed increase in ferry carryings and survey programmes undertaken in this and previous RET evaluations clearly highlight the growth in the tourism market. There is also clear evidence of an extension of the tourist season. Note however that definitive, island level tourism statistics are not available, and this means that accurate quantification of this impact is not possible.
Enhance local economies and the wider national economy.	moderate positive contribution	RET has made a positive overall contribution to local economies and the wider economy – it has facilitated: improved access to employment, training and business opportunities additional leisure travel (providing social benefits) increased expenditure – 37% in resident survey noted that spending had increased in general since RET was introduced Growth in visitor numbers, expenditure and the length of the season It is though important to note that these benefits are set against an annual spend of £25m on the policy, and satisfaction is not universal. Again, the lack of island-level statistics means we cannot accurately quantify this impact.

How may RET contribute to the National Transport Strategy 2

The National Transport Strategy 2 (NTS2) sets as its Vision:

We will have a sustainable, inclusive and accessible transport system, helping to deliver a healthier, fairer and more prosperous Scotland for communities, businesses and visitors.

Table 8.2: How may RET contribute to the NTS2 ‘promotes equality’ outcome?
/	Assessment	Comment
NTS2 Priority: Promotes equality
Will provide fair access to the services we need	highly positive contribution	RET has reduced the cost of travel to most island residents. The surveys suggest that island residents are now making journeys they previously did not make and, when taking a car, are travelling to destinations which they did not previously go to. They are therefore benefitting from opportunities previously unavailable to them.
Will be easy to use for all	slightly negative contribution	There is widespread concern across the islands and in the haulage sector about vehicle deck capacity acting as a constraining factor on peoples’ ability to travel at the time when they need to / wish to, particularly at short notice. This is borne out by the load factor analysis in this report, particularly on the high volume routes. In the ‘2015 RET’ islands, 87% of respondents to the resident survey are now finding it more difficult to make a booking, with concerns also expressed about queue lengths on non-bookable routes impacting on residents’ ability to travel. The booking window has also demonstrably moved – prior to RET, people tended to book 2-3 days in advance, but now typically book 2-4 weeks in advance.
Will be affordable for all	moderate positive contribution	RET has reduced the cost of fares on all routes, with carryings and survey data suggesting that pre-RET vehicle fares were in many cases frustrating journeys which people wanted to make. It should however be noted that not all island residents experienced a large reduction in fares compared to previous multi-journey books. This is particularly the case in the Firth of Clyde islands where the use of multi-journey tickets was widespread.

Table 8.3: How may RET contribute to the NTS2 ‘takes climate action’ Outcome?
RET and NTS2 outcomes	Assessment	Comment
NTS2 Priority: Takes climate action
Will adapt to the effects of climate change	moderate negative contribution	RET has prompted increased vehicular travel, contributing negatively to the net zero target and potentially local air quality. Additional sailings are also being operated to cope with RET related demand, generating additional CO2 and other emissions.
Will help deliver our net zero target	moderate negative contribution	The market has responded to it now being cheaper to take a car on most routes. However, it is important to note that these additional car journeys generate economic and / or social welfare benefits for those making them and thus this presents an important trade-off in the policy
Will promote greener, cleaner choices	moderate negative contribution

Table 8.4: How may RET contribute to the NTS2 ‘Helps our economy prosper’ outcome?
RET and NTS2 outcomes	Assessment	Comment
NTS2 Priority: Helps our economy prosper
Will get us where we need to go	slightly positive contribution	The reduction in ferry fares has facilitated additional journeys and opened-up a wider range of destinations for those making them (usually by car).
Will be reliable, efficient and high quality	slightly negative contribution	Operator performance data (and indeed feedback from the operator) suggests that high demand in peak periods is slowing down turnaround times, impacting on punctuality to timetable and also the ability to recover in the event of disruption. Feedback from CMAL and CFL also noted that assets are being worked harder and longer across the network, giving rise to potential reliability and resilience issues.
Will use beneficial innovation	no impact	RET has had no impact on this area.

Table 8.5: How may RET contribute to the NTS2 ‘improves our health and wellbeing’ outcome?
RET and NTS2 outcomes	Assessment	Comment
NTS2 Priority: Improves our health & wellbeing
Will be safe and secure for all	slightly negative contribution	The generated vehicle kilometres will have contributed towards an increase in accidents. Concerns were also expressed in several communities about the impact of additional traffic on local road safety, particularly on single track roads, and in and around ferry marshalling areas. Particular concerns were raised at Craignure and Armadale.
Will enable us to make healthy travel choices	no impact	RET has had no impact on this area.
Will help to make our communities great places to live	slightly positive contribution	The research undertaken in this and previous studies suggests that RET has contributed towards the improvement of communities, although it should be noted that this is not a universally held view, with residents of e.g. Cumbrae and Mull & Iona noting that RET has made their communities worse places to live. This issue may benefit from further research to reach a definitive position.

How may RET contribute to the National Islands Plan?

The Scottish Government published the National Islands Plan in December 2019. The Plan details 13 Strategic Objectives for Scotland’s island communities. The table below sets out the extent to which RET is contributing to these strategic objectives for islands served by the CHFS network:

Table 8.6: How may RET contribute to the National Islands Plan
Strategic objective	Assessment	Comment
To address population decline and ensure a healthy, balanced population profile.	slightly positive contribution	Population estimates suggest that long-term population declines in several islands have now been slowed, checked or reversed. The extent to which RET has contributed to this is though unclear. However, the resident survey did find that RET has contributed to in-migration to the ‘2015 RET’ islands, boosting in-migration by around 10%.
To improve and promote sustainable economic development.	slightly positive contribution	As previously noted, RET has reduced travel costs for many island residents resulting in increased spending locally, improved accessibility to employment, education and business opportunities, whilst also increasing visitor numbers in the isles.
To improve transport services.	slightly positive contribution	RET has reduced the cost of travel, improving accessibility for island residents. It should be noted however that issues around ferry capacity and a decline in bus patronage have weakened the benefits of RET in this respect.
To improve housing	no impact	RET has had no impact on this area.
To reduce levels of fuel poverty	slightly positive contribution	As a general point, RET has for the most part increased the disposable income of island residents. Whilst RET does not apply to commercial vehicles, it has in certain islands improved access to mainland vehicle fuel suppliers. This is contributing to a reduction in fuel poverty, albeit it can also lead to economic leakage from the island (both in terms of fuel and ancillary purchases).
To improve digital connectivity	no impact	RET has had no impact on this area.
To improve and promote health, social care and wellbeing	slightly positive contribution	RET has improved access to mainland based health facilities as well as to leisure opportunities and family & friends, likely improving health outcomes and wellbeing. On the other hand, full vessels , in terms of vehicle capacity, have meant missed health appointments for some.
To improve and promote environmental wellbeing and deal with biosecurity	slightly negative contribution	As previously noted, RET makes a negative environmental impact in terms of increased vehicle & ferry emissions and, anecdotally, air quality in certain port towns.
To contribute to climate change mitigation and adaptation and promote clean, affordable and secure energy	slightly negative contribution	See above.
To empower diverse communities and different places	slightly positive contribution	RET has provided communities with improved accessibility to a wide range of services, whilst also increasing visitation to the islands.
To support arts, culture and language	slightly positive contribution	The increased number of visitors to the islands is supporting an expanding arts and cultural sector, providing opportunities for new business formation and expansion. Increased second home ownership may present a threat to the language, but there is no evidence to support this either way.
To promote and improve education for all throughout life	slightly positive contribution	RET has improved access to, choice and the affordability of education in certain communities (e.g. Morvern and Ardnamurchan). It has also made it less expensive for students from the islands to travel home more regularly (and less expensive for their families to visit them).
To support effective implementation of the National Islands Plan	no impact	RET has had no impact on this area, as this relates to the delivery of the plan.

How may RET contribute to Scotland’s Economic Strategy?

Through the definition of four ‘priorities, Scotland’s Economic Strategy establishes the means by which the Scottish Government’s Purpose will be delivered:

Table 8.7: How may RET contribute to Scotland’s Economic Strategy?
SES priorities	Assessment	Comment
Investing in our people and our infrastructure in a sustainable way	slightly positive contribution	The evidence from this and previous RET studies suggests that lower ferry fares are contributing directly to new investment, whilst also supporting a generally more positive economic environment.
Fostering a culture of innovation and research and development	no impact	RET has had no impact on this area.
Promoting inclusive growth and creating opportunity through a fair and inclusive jobs market and regional cohesion	moderate positive contribution	As has been evidenced, RET has improved access to employment, education and business opportunities for most islands. Moreover, the reduction in fares for some of Scotland’s most fragile communities is contributing strongly to regional cohesion.
Promoting Scotland on the international stage to boost our trade and investment, influence and networks	slightly positive contribution	RET has been part of a package of measures which have made the islands more popular for foreign tourists. As well as the direct benefits of their visit, it also exposes them to key Scottish products such as whisky, Harris tweed etc

How may RET contribute to the Scottish Government’s Purpose?

In defining how all elements of Scottish society are contributing towards the Scottish Government’s Purpose, a National Performance Framework has been developed to establish desired outcomes and track progress towards these outcomes. The table below summarises the National Outcomes and the contribution RET has made towards delivering them (and hence its contribution to the Government’s Purpose).

Table 8.8: How may RET contribute to Scottish Government’s purpose?
National Outcome	Assessment	Comment
Children and young people: we grow-up loved, safe and respected so that we realise our full potential.	slightly positive contribution	RET has improved access to, choice and the affordability of education in certain communities (e.g. Morvern and Ardnamurchan). It has also made it less expensive for students from the islands to travel home more regularly (and less expensive for their families to visit them).
Communities: We live in communities that are inclusive, empowered, resilient and safe	slightly positive contribution	RET has provided communities with improved accessibility to a wide range of services, whilst also increasing visitation to the islands.
Culture: We are creative and our vibrant and diverse cultures are expressed and enjoyed widely.	slightly positive contribution	The increased number of visitors to the islands is supporting an expanding arts and cultural sector.
Economy: We have a globally competitive, entrepreneurial, inclusive and sustainable economy.	slightly positive contribution	See Table 8.4, which summarises how RET contributes to the Government Economic Strategy.
Education: We are well educated, skilled and able to contribute to society.	slightly positive contribution	See ‘Children & Young People’ above.
Environment: We value, enjoy, protect and enhance our environment.	slightly negative contribution	As previously noted, RET makes a negative environmental impact in terms of increased vehicle & ferry emissions and, anecdotally, air quality in certain port towns.
Fair Work and Business: We have thriving and innovative businesses, with quality jobs and fair work for everyone.	slightly positive contribution	RET has created new training, employment and business opportunities in the islands.
Health: We are healthy and active.	slightly positive contribution	RET has improved access to mainland based health facilities as well as to leisure opportunities and family & friends, likely improving health outcomes and wellbeing. On the other hand, full vessels, in terms of vehicle capacity, have meant missed health appointments for some.
Human Rights: We respect, protect and fulfil human rights and live free from discrimination.	no impact	RET has had no impact on this area.
International: We are open, connected and make a positive contribution internationally.	slightly positive contribution	See Table 8.4, which summarises how RET contributes to the Government Economic Strategy.
Poverty: We tackle poverty by sharing opportunities, wealth and power more equally.	moderate positive contribution	RET has increased the disposable income of island residents, whilst also providing lower cost access to a wide range of employment, education, business and leisure opportunities. In certain communities, it also contributes towards a reduction in fuel poverty

Summary

The introduction of RET across the CHFS network has broadly delivered its initial objectives and contributed to the headline government policy documents. The reduction in fares has increased the disposable income of island residents; extended access to employment, education, business and leisure opportunities and brought more visitors to the islands.

Whilst there are elements of dissatisfaction with the policy – most notably ferry capacity & reliability and the impact on island infrastructure – there is broad consensus that RET has been a good thing for the islands. It is though only fair to note that this sentiment is not universal and there are particular islands where there is significant dissatisfaction with elements of the policy.

In any future review of the RET policy, the research suggests that the following issues should be considered:

Two key issues have emerged from this evaluation from the perspective of island residents:
- They cannot always travel when they want to travel: the research suggested an appetite for a range of demand management related measures which should be further explored.
- Island infrastructure / communities are being overwhelmed: There are perhaps two approaches to addressing this issue – (1) implementing measures to reduce visitor numbers / car-based visitor numbers; or (2) investing in tourism infrastructure (e.g. roads, parking, visitor amenities) and ‘greening’ it where possible. As businesses have made investments to the benefit of the islands’ economy in response to the increased visitor numbers, the first option would be challenging and therefore a better question could be over how infrastructure improvements could best be delivered in the affected communities.
From the perspective of the Scottish Government, RET has induced a circa 20% growth in car travel by ferry on the CHFS network, although it should be noted ferry-related car traffic makes up a very small proportion of national car traffic, so any such outcome should be viewed in this context. As well as putting cost and resilience pressure on the assets, it is leading to network-wide demands for investment in additional services, tonnage and infrastructure. Unless there is a policy decision to reverse at least some of the fares reductions introduced since 2008, there is a strategic choice between ‘predict and provide’ - which would be contrary to the National Transport Strategy and present substantial capital and ongoing operating costs - or implementing a more balanced approach of additional capacity and demand management measures (of which fares could be a part), which would represent a departure from the current RET policy.

In order to aid transparency and understanding, the objectives of any fares review should reflect the findings of this, and previous RET evaluations, which could be captured in revised / new Transport Planning Objectives, reflecting the greater understanding of the scope and scale of impacts of the current fares policy.

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