Task Force on LA Ferry Fleet Replacement - meeting with Orkney Islands Council (OIC) - minutes - 31 January 2023

Attendees

  • John Swinney MSP, DFM and Cabinet Secretary for COVID Recovery
  • Jenny Gilruth MSP, Minister for Transport
  • Cllr James Stockan, Leader, OIC
  • Cllr Heather Woodbridge, Depute Leader, OIC
  • Oliver Reid, Chief Executive, OIC
  • Gareth Waterson, Director of Enterprise and Sustainable Regeneration, OIC
  • Roddy Macdonald, TS, Director of Ferries
  • Redacted, TS, Head of Operational Policy
  • Redacted, TS, Operational Policy Manager (note taker)
  • Redacted, SG, Local Government Finance
  • Catriona Matheson, SG, Special Advisor

Agenda

Item 1 – Welcome and Introductions

DFM welcomed the delegates from Orkney and thanked them for rearranging their travel plans to accommodate this first meeting of the Task Force.  He then invited introductions around the table.

Item 2 – SG Context

DFM outlined the purpose of the meeting which was to agree preparatory work to be carried out in looking at the challenges faced by OIC in replacing an ageing ferry fleet and to work together in identifying solutions to that end. DFM emphasised that both parties had a contribution to make to this process and that this would be a joint endeavour between SG and OIC in the context of a challenging budget position.  Ministers are keen to be involved in looking at options for operating a safe, reliable and sustainable ferry service to islanders. Cllr. Stockan responded that he was looking for parity with the funding arrangements that other local authorities have where Government are fully funding their requirements.

Item 3 – OIC overview

Cllr. Sockan gave a brief history of how OIC came to be running its inter-island ferry fleet.  This arrangement was with the UK Government when OIC asked to be the operator for its ferries, while the UK Government operated the NIFS and CHFS services at that time.  He acknowledged that OIC continued to receive revenue funding from SG to operate its services and he. has written to DFM asking for an increase in 2023-24 to maintain its services.  DFM asked about capacity in OIC to run the services.  Cllr. Stockan responded that he was concerned about the capacity in OIC Transport Team with 3 people running all transport services. 

Funding continued to be tight for both operation of the service and vessel renewal, some of which were now over 30 years old and struggled to get parts for maintenance.  Cllr. Stockan was looking for “transportation solutions”, not just for ferries but including wider air transport and other innovations such as alternative sources of fuels in working towards Net Zero.     Cllr Stockan suggested that OIC could inquire of the UK Government if there was any funding for Net Zero and “test engines/fuels” for ferries.  He added that OIC is asking the UK Government for “special status” for testing new fuels, which would allow access to quick permissions for such tests.

Cllr Woodbridge said that the biggest disruption to services was ferries breaking down and not having a replacement vessel for when other vessels were undergoing maintenance, leading to some islands experiencing no or very limited services for several weeks at a time, with air services regularly having to be deployed to deliver a freight service to North Ronaldsay.  The issue of accessibility, especially for people with disabilities, on old vessels was also an issue.

Cllr Stockan added that OIC could offer the ferry service back to SG to operate, however, DFM said that was a different proposition to asking for fleet renewal.  He added that it was important to acknowledge expectations of communities, however, budgets remained under pressure. Vessels being procured now were all different to suit the routes identified and not one design would suit every community.

Oliver Reid added that the Task Force needed to look at all infrastructure including harbours and speaking to other organisations involved in renewables.  OIC would be happy to consider being a “test case” for new ideas, new alternative fuels and alternative transportation, which would create fairness for residents and businesses in getting goods and services to and from the islands. He reported that OIC has a twinning and friendship agreement with the county of Vestland in Norway and as part of the engagement with Vestland has been engaged in discussions on innovation in energy and transport which might bring some helpful learning to the Taskforce.  MfT noted important to look at range of other ferry operations for insights they can bring.

Item 4 – Practical arrangements for the Task Force

DFM welcomed the overview and suggested that officials should meet regularly to progress the questions above and actions for the Task Force to take forward, such as wider representation from, for example, CMAL, and a defined remit. He suggested Ministers and Cllrs. meet again in early April, with official meetings scheduled before then.

Item 5 – Agreement of key issues to be considered going forward

  • Funding
  • Business case
  • Technical Resources

Funding - DFM reiterated the challenging SG budget position and suggested that all possible funding options should be considered.  SG officials would need to be involved to outline potential funding options available to be shared with OIC.  Oliver Reid commented that the ferries need to be replaced while maintaining a sustainable and reliable transport system, with funding options as flexible as possible. 

Business case – OIC has completed business cases for ferry renewal and will share with TS/SG officials.

Technical Resources –officials agreed to consider what technical support would be required to progress this work, for example SG support to carry out a “Gateway Review” of the OIC’s business case. 

Item 6 – Next Steps

The DFM and MfT thanked everyone for their input and looked forward to seeing progress and meeting again in early April.  

Actions

  • Agree date and venue for Ministerial meeting in early April.
  • Agree dates for Officials’ meetings [post meeting update – next meeting 9 Feb]
  • Agree remit and membership of group (TS/OIC)
  • Outline draft funding options to be discussed (TS/SG Finance/OIC)

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Published Date 8 Mar 2023 Type Topic