(S3O-11208) Road Equivalent Tariff Pilot (Extension)

10. Charlie Gordon (Glasgow Cathcart) (Lab): To ask the Scottish Executive whether its decision to extend the road equivalent tariff pilot until 2012 was based on an independent evaluation. (S3O-11208)

The Minister for Transport, Infrastructure and Climate Change (Stewart Stevenson):

The Government is committed to supporting lifeline ferry services and promoting economic growth in all our remote and island communities. We are piloting the road equivalent tariff approach to setting fares in Scotland because we believe that it is the best way to deliver cheaper fares for islanders, tourists and businesses. The RET pilot has been focused on the Western Isles, but we want it to pave the way for fair ferry fares for everyone.

The recent announcement extending the RET pilot for a further year will allow CalMac Ferries to publish its fares for 2011 so that businesses can plan ahead. The final evaluation of the pilot will be completed in 2011. The decision on whether to roll out RET to other routes will be taken next year, once the results of the evaluation are available and have been considered by ministers.

Charlie Gordon: Let me quote from the independent report, "Road Equivalent Tariff Study: Interim evaluation" of March 2010, which was commissioned by the minister from Halcrow Fox. The evaluation states on page 73:

"It is generally too early to say whether RET has resulted in lowering the cost of living and reducing costs for local businesses."

It goes on to mention a "final evaluation"—that was to be in December this year, the minister originally told the Parliament. Why is the minister rushing to judgment, before the final evaluation, so as to sustain 40 per cent fares cuts in the Western Isles, Coll and Tiree—and good luck to them—whereas the fares for most other island communities have increased by nearly 10 per cent on his watch? Is his ferry story not just crude electioneering?

Stewart Stevenson: The selection of the Western Isles for the RET pilot was based on economic and social factors. [Laughter.] There has been a 19 per cent drop in the population of the Western Isles in the past 20 years, which is not by any means a matter of levity for the people who live there. [Interruption.]

The Presiding Officer (Alex Fergusson): Order.

Stewart Stevenson: The Western Isles has an average wage some £50 to £70 per week lower than that in the northern isles. The RET pilot was a clear intervention to support a part of Scotland that requires our support.

As Charlie Gordon indicated, the Halcrow report said that it was too early to come to a final conclusion. That is precisely why we have extended the pilot for a further year. It is clear that traffic has increased on the back of the RET pilot, but the economic impact is not clear. We want to see that it delivers economic value to the communities. I am confident that we will see that, but we have to do the evaluation at the right time.

Liam McArthur (Orkney) (LD): The minister will be aware of the anger in my constituency at his decision to extend the pilot for a further 12 months. When the decision was made, he and his colleagues in the Western Isles were at pains to highlight the unsurprising success of the cheap ferry fares scheme. It is also not surprising when consultants inform the Government that further work needs to be done.

Does the minister accept that, however long he runs the pilot in the Western Isles, it will tell him nothing about the impact that RET would have on routes to, from and within Orkney? Will he confirm whether any consideration was given to extending the pilot to any routes in the north isles or, indeed, the other Argyll islands?

Stewart Stevenson: It is clear that patronage has risen on the NorthLink routes over the past year. That is a welcome sign of the value that is placed on the ferry links to the northern isles. It is important to realise that, last year, in an attempt to raise further revenue in the face of rising fuel costs, we increased fares on the CalMac Ferries network by 2 per cent but did not apply that increase to the fares for the northern isles in recognition of the fact that the long ferry routes are of a different character. Were we to apply our formula for RET to the northern isles, it would substantially increase fares on certain routes to Orkney and Shetland.