Pentland Ferries
The final item of business is a members’ business debate on motion S3M-6331, in the name of Mary Scanlon, on Pentland Ferries. The debate will be concluded without any question being put.
Motion debated,
That the Parliament congratulates Andrew Banks of Pentland Ferries for the work that he has done since its inception in 1997; notes that Pentland Ferries receives no state aid to support its services; considers that the recent addition of the MV Pentalina is a welcome boost and that these services provide a crucial lifeline for island communities and businesses, particularly the agriculture and fishing industries, through a substantial volume of passenger and freight transport; commends the perseverance of Andrew Banks who has literally built up the business since 1997, constructing the pier at Gills Bay, and commends the continued service that Pentland Ferries provided, when the MV Hamnavoe was diverted to Bergen to assist stranded passengers during the initial volcanic ash disruption, by ensuring that a link between Orkney and the mainland was maintained.
17:07
I had a members’ business debate in 2002 on the northern isles ferries. Very little has changed since then. However, I welcome and commend the book “Pentland Hero” by Scottish National Party councillor in the Highland Council, Roy Pederson, who states clearly the David-and-Goliath battle that has been faced by Andrew Banks, who is a farmer’s son from Orkney. To be politically balanced, I can do no better than quote from the foreword by Lord George Robertson, former Secretary of State for Defence and secretary-general of NATO and a Labour MP for 21 years, because I do not think that I could have put this better. He said:
“This is the story of how the islands of Scotland, the subject of noisy and wholly justified championing over the years, have in fact been betrayed by the very authorities they trusted to protect their vital connectivity with the mainland. It is also a story, as yet unfinished, of how the taxpayer has for many years shored up inefficient, inappropriate, over-expensive ferry services where in many cases there have been cheaper, efficient, subsidy-free alternatives. The book chronicles a classic example of how one man had the tenacity, the resources, the persistence and public-minded spirit to provide a ferry service for his fellow citizens between his native Orkney Islands to the nearest part of the Scottish mainland. It is a tale of governmental skulduggery, unfair competition and elected authoritarianism—all designed to drive him from his dream of a better and cheaper service for the public—and all of it organised and orchestrated by the very people, in Edinburgh and Kirkwall, elected to look after the islanders’ interests.”
Those are George Robertson’s words, not mine. He compares the enterprising spirit and profitable ferry crossing with the state-owned CalMac Ferries—and with NorthLink Ferries Ltd—which manages to make a loss on every route it operates. Andrew Banks faced, and still faces, countless obstacles, hostility and a cash-rich competitor with limitless taxpayers’ funds. According to Roy Pedersen’s book, Orkney Islands Council has now publicly admitted that it refused Andrew Banks access to a council-owned pier in order to constrain his services.
Nonetheless, Andrew Banks was recognised by his fellow Orcadians. When the local newspaper Orkney Today launched in 2004 an annual trophy to recognise individuals who had made outstanding contributions to their community, Orcadians chose Andrew Banks—the Pentland hero—as the outstanding ambassador for Orkney and a shining example to others. Unlike many elected politicians, civil servants and others of the day with responsibility for ferry services—as George Robertson said—Orcadians recognised the entrepreneur’s invaluable contribution.
I will compare Pentland Ferries’ MV Pentalina with NorthLink Ferries’ MV Hamnavoe. The Hamnavoe cost £30 million; the Pentalina cost £7 million. NorthLink’s Hamnavoe needs a crew of 28, while Pentalina has a crew of 10. The Hamnavoe travels at 17 knots and the Pentalina travels at 16 knots. The Pentalina’s fuel consumption rate is 620 litres per hour; the rate on NorthLink’s Hamnavoe is three times greater, at 1,835 litres per hour. For all its cost, the Hamnavoe takes only 17 more cars than the Pentalina.
As interesting as those comparisons is the comparison of subsidy. Pentland Ferries services receive nothing—not a penny. In 2007, NorthLink received £31 million. A report that was published in 2006 drew attention to a subsidy for NorthLink of £78 million. In 2008-09, the subsidy for CalMac and NorthLink rose to £90 million. Their boats involved huge capital costs, which taxpayers funded, and the new piers cost more than £50 million.
In comparison, Andrew Banks bought two second-hand CalMac ferries, built two piers and ran a ferry service at a profit. He had more than 11,621 passengers in July 2001, in his first year of operation. That was an excellent tourism year in Orkney. Andrew Banks’s service gave local people the opportunity to travel to the mainland on a shorter and cheaper route than that of the subsidised NorthLink, whose subsidy rose from 22 per cent in 1991 to 62 per cent in 2007.
An example of the skulduggery that Lord George Robertson mentioned comes from online advertising. A Google search for “Pentland Ferries” took people directly to a link to www.northlinkferries.co.uk.
I commend Pentland Ferries for maintaining the ferry link between Orkney and mainland Scotland when the Hamnavoe was diverted to Bergen to assist stranded air passengers during the initial volcanic ash disruption.
The greatest trading company in the industrial world was the Hudson’s Bay Company. Many Orcadians were at that company’s helm. We should congratulate Andrew Banks and Pentland Ferries on battling the state, elected politicians and civil servants to provide a first-class service from Caithness to Orkney.
We need entrepreneurs and we need to value them. I hope that the debate conveys the message that Scotland needs entrepreneurs such as Andrew Banks and that the state, the Government and all elected politicians will work to support them rather than be against them.
17:14
I congratulate Mary Scanlon on securing the debate. As a Transport, Infrastructure and Climate Change Committee member, I was involved in the committee’s ferries inquiry a couple of years ago. Much of the evidence that Mary Scanlon described surfaced when the committee took and weighed up evidence.
Pentland Ferries has made a success of the short sea route to Orkney from the Caithness coast. The Scrabster to Stromness route is much longer and much more exposed.
The qualities of the new catamaran MV Pentalina on the route under debate are well tested. By contrast, the design of the Hamnavoe is much less cost effective, although a design other than the catamaran would probably be needed to serve the open ocean route. The ferry design that was commissioned at the same time as the large NorthLink ferries could easily carry more cars and, indeed, such ferries do so safely on routes similar to Orkney and Shetland.
As we have heard, despite disdain from civil servants and Orkney Islands Council, Andrew Banks persisted. Thanks to the Gills Bay harbour committee and after a major setback with the linkspan, Andrew Banks was able to get a sheltered berth for his roll-on, roll-off ferry. Orkney Islands Council did not help in respect of the Burwick harbour proposal that would, at least in summer, have cut the journey time by half an hour. Cuts in journey times are needed. The more time someone spends on a ferry, the more expensive it is; road and other modes of transport are cheaper than ferry transport. The proposed short sea route was not helped by the decisions of Orkney Islands Council; the journey time is longer than it needs to be.
The Scottish Government recognised the reliability of the Pentalina when the volcanic ash emergency began. With hindsight, people can now see that some of the steps that were taken at the time were over the top. However, at the time, we did not know the effect of the volcanic ash. The Scottish Government’s decision to send the Hamnavoe to Bergen was an important part of bringing people home. Locals from Caithness who were stranded in Norway included the UHI Millennium Institute lecturer Linda Ramsøy, who was delighted to have been given the chance to get home and back to work, as were many other people.
Unnecessary alarm was whipped up in Orkney by people who should have known better. Figures for the past four years show more than 250 weather-related cancellations to NorthLink ferry services to the islands and 620 weather-delayed sailings. People who use those services to attend mainland appointments may have been inconvenienced by the three-day disruption that ensued as a result of the Bergen rescue, but there are many more days in each year on which the NorthLink service has not delivered because of the weather. As for bypassing the Aberdeen-Kirkwall-Lerwick service, NorthLink has abandoned 41 calls since 1 July 2006. People correctly said that hospital appointments were affected during the short time when the Hamnavoe was not available, but there have been many more occasions when that also happens because of bad weather. Flights are also disrupted at those times.
A clearer definition of “lifeline services” is needed. When we see headlines such as that in The Orcadian of 22 April, “Pentland Ferries left to cover as planes grounded and Orkney’s lifeline ferry service removed”, we have to ask: what is a lifeline? A lifeline is a regular ferry that takes the plane’s place to do the job of transporting people from the islands to the mainland.
You should be finishing now, Mr Gibson.
The Scottish Government ferries review has to look at costs, which is why the present arrangements need to come under specific scrutiny. The present arrangements do not, for weather-related reasons, guarantee lifeline services. The debate that Mary Scanlon has raised allows us to look forward to a ferries review that will take these issues on board, and do so seriously.
17:19
I congratulate Mary Scanlon on securing the debate and I strongly endorse the text of her motion. She mentioned my old friend and colleague, Lord George Robertson, who was very helpful and influential when we were at Westminster together. He is, of course, well known now for his many roles, particularly as a director of Western Ferries.
As we have heard, Pentland Ferries was set up by Andrew Banks in 1997. Initially, he ran and serviced routes between Invergordon and Orkney. At that stage, Pentland Ferries found it difficult to generate sufficient freight. However, Mr Banks is a man with vision and a determined nature, and he obtained a 99-year lease at Gills Bay terminal, about 3 miles from John o’Groats. In May 2001, the MV Pentalina-B started sailing into St Margaret’s Hope.
Mr Banks understood the important role that ferries play in rural development and in attracting inward investment and sustaining indigenous jobs by providing lifeline services. At one stage, I was a member of the Transport, Infrastructure and Climate Change Committee with Rob Gibson. In the past, the committee has argued that we need a national ferry strategy if we are to break away from the Cinderella service feel and atmosphere that ferries have had in the transport family, compared with road, rail and aviation. The mantra of better integration of different modes of transport has echoed through the lecture halls of every transport conference in history. However, we have a system that cannot co-ordinate the end of the winter timetables for bus, rail and ferry services with the start of the summer timetables, so the ferry sails into Oban just as the train departs.
Andrew Banks understands that ferry customers want comfort, speed, frequency and reliability. The MV Pentalina, which was built in the Philippines, is the state of the art. As Mary Scanlon pointed out, it has a capacity of 350 passengers. It can take either 32 cars or eight articulated lorries, and has an impressive speed—compared with ferries in the west of Scotland—of 18 knots. The ship has been designed to handle rough waters and will sail all year round.
This debate and previous debates about ferries generally have highlighted the need to develop new routes, as Mr Banks has done; the need to improve the frequency of services; the need to utilise vessels better; the need for a common design of vessels, with greater automation; the need to upgrade piers, as has happened at Gills Bay, to allow greater turnaround in harbours; and the need to cut the time for commissioning new vessels. Mr Banks has shown how a private individual can locate a gap in the market and develop a viable service there. By his hard work and imagination, he has highlighted wider issues relating to ferry services in Scotland.
17:22
Like David Stewart, I congratulate Mary Scanlon both on her motion and on securing this evening’s useful debate. I also thank David Stewart for declaring Lord Robertson’s Western Ferries interest in his absence.
The debate is useful in a number of respects, not least in providing the Parliament with an opportunity to acknowledge the tremendous efforts of Andrew Banks and his wife Susan in developing what is a family business, in every sense of the world. Andrew’s characteristic modesty would lead him to struggle with Mary Scanlon’s implication that he may be the inheritor of John Rae’s legacy, but we will leave it at that.
Andrew Banks has been involved since 1997 in the enterprise that we are debating. However, as the motion indicates, the Pentland Firth service got up and running only in 2001, since when it has steadily built up an impressive and loyal customer base. On a personal level, the debate provides me with the chance to put on record my gratitude to the staff and crew of Pentland Ferries for the work that they do and the way in which they go about providing a service to my constituents and those visiting Orkney.
As a regular user of the service, I recall one recent occasion when I had cause to rely heavily on the willingness of Pentland Ferries staff to meet the needs of their customers. Along with Peter Peacock and other members of the Rural Affairs and Environment Committee, I had been attending an evidence session, in Thurso, on the Crofting Reform (Scotland) Bill. So engrossing was the evidence of Drew Ratter and his fellow witnesses that I left Thurso a little later than intended and arrived at Gills Bay as the bow doors were closing. Such is the fair-minded and egalitarian nature of Orcadians that I am confident that I was allowed to board the Pentalina despite being the local MSP, rather than because of it. In any event, I am pleased to be able formally to put on record my thanks and apologies to the crew for their help that day.
Over the years, Pentland Ferries has built up a loyal customer base—in part, no doubt, due to the approach of its staff. A key factor has been a timetable that often proves more convenient for some travellers and freight operators. Although Pentland Ferries has received no public subsidy over the years, Andrew Banks has been successful in keeping his pricing structure competitive and has been rewarded in the business that he has been able to attract. Moreover, as other members have mentioned, he has invested in a new vessel that, as the motion indicates, has provided a real boost to the service. It is only fair to acknowledge the serious difficulties that Andrew Banks experienced in securing the catamaran, difficulties that placed enormous strains on the business. It is to his credit—and to the relief of many people in my constituency—that Andrew and his colleagues were able to emerge from that period still in a position to build on the success of the business.
Mary Scanlon reminded us that in 2002 she secured a members’ business debate on wider issues to do with ferry services to the north isles, including the lifeline service that NorthLink Ferries provides. During that debate, my predecessor as member for Orkney, Jim Wallace, highlighted the significant improvements that had been made to ferry services to and from as well as within the north isles during his time representing the islands. Since then, despite Mary Scanlon’s assertion, further improvements have been made, not least through the inclusion of freight in the NorthLink contract, the roll-out of customised cassettes for livestock transport and the provision of additional cabin capacity on the popular Aberdeen route.
I did not assert—at any time—that no improvements had been made on the NorthLink service. I would not want anyone to get the impression that I did.
I will read the Official Report. That was the impression that I got.
There is concern in Orkney that the steady improvement in our lifeline ferry services is under threat. I heard what Rob Gibson said, but attempts by the Scottish ministers to put the Aberdeen service on a go-slow and the decisions to divert the MV Hamnavoe to Bergen and have the MV Hrossey bypass Kirkwall have fuelled people’s fears. It is understandable that my constituents are asking questions—I think that Rob Gibson is asking questions along similar lines—about why ministers can remove a lifeline service in a situation that is urgent but cannot be considered an emergency. Although Pentland Ferries responded well in the circumstances, it remains the case that, in effect, ministers removed both Orkney’s lifeline ferry services simultaneously and without consultation.
Although I understand and share Mary Scanlon’s admiration for Andrew Banks and Pentland Ferries, I do not think that my constituents would thank her or Scottish National Party councillor Roy Pedersen for arguing for the removal of the NorthLink service. Indeed, there is a strong case for saying that in recent years and at certain times in summer the demand on the various routes could not have been met by a single carrier. When we consider the situation in relation to ferry services between Gourock and Dunoon, it is not difficult to understand why people in Orkney are nervous about similar disruption to their essential lifeline.
17:27
I commend Mary Scanlon for securing the debate.
I encountered Mr Banks two years ago, when he gave evidence to the Transport, Infrastructure and Climate Change Committee’s inquiry into ferry services, to which Rob Gibson referred. He made a big impression on me and I thought that he was a remarkable man. He told us that he was carrying 80 per cent of the freight into Orkney and carrying 80 per cent of the sheep out of Orkney. I would be delighted to hear that he is doing even better now. He also told the committee that he was receiving no public subsidy. He said that he did not have a fancy financial arrangement, he had an overdraft. It was refreshing to encounter a witness who gave such direct answers.
I have been reading the Official Report of that meeting, to remind myself of what Mr Banks said about wider issues to do with the future of ferry services. He talked about the possibility of privatising Clyde, Hebridean and northern isles ferry routes, which could be individually tendered for. When we went into detail, he said that three or four CalMac Ferries routes could be quite profitable. However, when he was pressed on what would happen if a private operator went out of business he suggested that CalMac might step in, which made me wonder whether there would be a CalMac to step in if everything had been privatised.
Mr Banks made an interesting and surprising point when he told the committee that road equivalent tariff on his Orkney run
“would drop our fares by about 50 per cent”.—[Official Report, Transport, Infrastructure and Climate Change Committee, 13 May 2008; c 731.]
Perhaps the minister will comment on that.
From an operational point of view, one of the most impressive things about Mr Banks’s service was his then-new initiative for integration of his ferry service with an onward bus service to Inverness. The intermodal approach is entirely to be commended.
In its report to the Parliament after its inquiry, the committee said that, when the European Commission had clarified certain matters that had been outstanding for a long time, the Scottish Government must expedite its forthcoming Scottish ferries review and bring the results to the Parliament. The Commission clarified matters some time ago.
Given that I lodged a parliamentary question on the issue, which the minister is due to give an oral answer to next week, perhaps he could tell us now and save himself the trouble: when will he come to the Parliament with the detailed outcome of his ferries review? In a debate of such a nature, a number of best-value issues undoubtedly arise that are deserving of a much more comprehensive debate about the way forward for ferry services in Scotland.
17:30
I, too, congratulate my good friend and Highlands and Islands MSP colleague Mary Scanlon on securing an important debate. I put on record my thanks to Andrew Banks and all his team at Pentland Ferries and my appreciation for the excellent service that they provide to my constituents. He comes from an ancient line of marine pilots who have navigated the Pentland Firth, which is one of the most dangerous sea channels in the world, for generations. His company provides an excellent service.
My constituents are fortunate indeed that Pentland Ferries offers a fast, frequent, reliable, efficient and competitively priced service that provides the choice of an alternative to the NorthLink service and increased capacity. Andrew Banks also provides an invaluable service to farmers and crofters in the transport of their livestock. He does all that at no cost to the taxpayer. His ferry service runs through one of the most challenging areas of sea in the marine world. It is the type of business that we should be commending and promoting in today’s Scotland.
I was delighted to attend the recent book launch of “Pentland Hero”, which is published by the leading Scottish publisher Birlinn, and I recommend it to all my MSP colleagues, because it is a very good read, and to anyone who has an interest in how we can support free enterprise and improve ferry services in Scotland.
The book sets out just how many obstacles Andrew Banks faced in trying to establish his service and compete with NorthLink, with its multimillion-pound Government subsidy. His success is all the more remarkable, given that he overcame those obstacles and won on what would appear to be an unfair playing field. Policy makers need to understand what enables his company to operate so successfully that, had it received subsidy equivalent to that which is received by NorthLink, it would have been able to offer a free service on the lifeline Scrabster to Stromness route, which would have saved the taxpayer around £20 million a year.
Will the member give way?
I need to make some progress.
I believe that Andrew Banks offered to do much the same on the Campbeltown to Ballycastle route for no subsidy but was again ignored by the Scottish Government.
Although the debate focuses on Pentland Ferries, I commend Western Ferries, which operates, without subsidy, in my native Argyll and Bute and provides a first-class and customer-responsive service on the Gourock to Dunoon route. Western Ferries, too, offers an alternative option at no cost to the taxpayer.
The successful operations of Pentland Ferries and Western Ferries surely demonstrate that the private sector has much to offer the ferry sector in Scotland. We await with great interest the results of the Government’s ferries review. We will continue to argue strongly that enterprising businessmen, such as Andrew Banks, who provide good ferry services should be able to compete fairly for more routes around Scotland’s coastline.
I will end with a quotation:
“This book tells the story of one man fighting an industrial bully. It amplifies the lone voice of the consumer against the battalions of ‘we-know-best’ government monopolists, who have never turned in anything approaching a profit.”
Those are not my words, but the words of Lord Robertson.
17:35
As other members have done, I thank Mary Scanlon for giving us the opportunity to discuss an extremely important topic. I share the admiration that others have expressed for Andrew and Susan Banks, and for the efforts that they have made in providing their service.
I will address one or two of the points that members have made. Mary Scanlon said that Pentland Ferries faces
“a cash-rich competitor with limitless taxpayers’ funds”.
In fact, the contract tightly constrains the funding that is available. That does not necessarily negate the member’s general point, but it ought to tidy up that particular expression of it. Even if it is in the book that members have mentioned, it is not true.
It was a quotation from Lord George Robertson.
I am sure that the Official Report will recognise the source, now that it has been put on the record.
The Pentalina is a different design to the Hamnavoe: it is a more modern design that would not necessarily have been available when NorthLink procured its vessels and put them into service. That reflects the general point that designs change over time and can improve.
The Pentalina is run by a private company, so we do not have access—as we do for NorthLink services—to figures on reliability. We do not know how many carryings there are, but the figure is probably of the order of a quarter of the traffic of the Hamnavoe. Charlie Gordon suggested that about 80 per cent of freight and 80 per cent of sheep are carried by Andrew Banks. I do not have information to rebut or endorse that, but I note it as an interesting point.
Mary Scanlon highlighted tourism as being an important industry for Orkney, which of course is the case. She highlighted the fact that the subsidies for NorthLink have risen. Indeed, the ferry budget as a whole has continued to rise. Fuel costs are now an increasing proportion of the costs of operating ferries, which is reflected in the subsidies that we have to provide.
Although there are routes in Scotland that are capable of commercial exploitation, they are very much in the minority in terms of the number of routes, if not necessarily the number of carryings—it is clear that the routes with the greatest number of carryings offer commercial opportunities. In the ferries review, we are not discounting that there are many different approaches to providing ferries other than provision by the state.
While we are on the subject of routes, has the minister any news on the Campbeltown to Ballycastle link?
I suspect, given the terms of the motion, that it would be inappropriate for me to respond on a matter that is clearly outside the topic of the Orkney route. However, I recognise and understand Jamie McGrigor’s continued interest in the subject. I met him recently, and the matters that we discussed in confidence are progressing.
Rob Gibson made the point that Pentland Ferries has been successful, which is absolutely correct. I am not familiar, as Liam McArthur and Rob Gibson perhaps are, with the difficulties that were experienced with Orkney Islands Council in relation to the provision of harbours. I do not find that Orkney Islands Council behaves in an irrational way, but I would be interested to hear more about that.
Dave Stewart talked about the difficulties of synchronising the changeover between summer and winter timetables, which is fundamentally more difficult even than he described it. Airlines worldwide have a common date on which they swap from summer to winter timetables. I have tried, but not yet succeeded, to persuade the train operating companies—and bus and other operators—in the United Kingdom that it would be useful if they aligned the dates, because it is clear that we will not get the airlines to change worldwide. We will continue to engage on that subject, but it is formidably difficult to achieve, although it sounds so simple and obvious.
Members have spoken about the common design of vessels. We are working with the Northern Ireland Executive and the Irish Republic on using European money to build common designs, so that one could, in effect, order from a catalogue instead of having to design every new vessel.
It is disappointing that at present no UK yards are bidding for ferries, to the extent that when we went with the Islay ferry, I phoned managing directors to find out why no bids were coming from them. I am afraid that I do not see any early change in that situation.
Will the minister give way?
Presiding Officer, I will do so unless I am out of time.
Please be brief, Mr Stewart.
Does the minister recognise that one of the problems in vessel commissioning across the world has been the scarcity of engines? As that is now getting slightly better in the world market, will that help to speed up the commissioning of new vessels?
Yes. One of the fundamental issues that prevented the Fairlie yard from bidding for the earlier contract was that the vessel would have had to sit complete on the slip for a year before the engine could be provided. The member makes a very good point. He clearly understands and is on top of the issue.
Liam McArthur pointed to the loyalty of Pentland Ferries’ customers. I agree that Andrew Banks is very much to be commended for the work that he has done. When we had to remove the Hamnavoe from service so that it could go to Bergen to rescue people from across the United Kingdom and from further afield so that they could be repatriated to the UK mainland—something that was very much welcomed by those who were rescued—it was clear that, at that time of year, Pentland Ferries could pick up the service to Orkney. Let me absolutely agree that Andrew Banks is to be commended for his entrepreneurial spirit.
I encourage everyone to engage in the ferries review, on which we have sent out formal notices to communities over recent months. We will produce the consultation document shortly—it has come to my desk once and I have requested some changes, so we are in the final stages—but, as the document needs to be approved by other ministers, I am not in a position to make absolute commitments as to when it will be published.
Clearly, given the large number of ferry routes and entrenched ways of working, it is time to look again both at how we organise our ferries and, more fundamentally, at the transport needs of communities. In some cases, roads might substitute for ferries if the right approach is taken. In other cases, it might be better to improve air links rather than ferry services. We need to look not just at ferries. Ferries serve economic and social purposes for communities, but there may be other ways of delivering on those. Let us open our minds to a wide range of possibilities and ensure that we all engage in the most useful and open-minded way on the subject.
I very much look forward to bringing the results of the consultation and discussion to Parliament in due course.
Meeting closed at 17:42.