Chamber and committees

The crew of the MV Arrow, whilst on a time charter with CalMac Ferries Ltd, will be employed by the vessel owner Seatruck Ferries Ltd.

The Scottish Government agreed with CalMac Ferries Limited (CFL) that the crew of the MV Arrow, though not covered by CFL terms and conditions or collective bargaining agreements, should receive the National Living Wage for the duration of the charter .

The Scottish Government were not part of the negotiations regarding the time charter agreement of the MV Arrow. These were undertaken between CalMac Ferries Ltd and the Isle of Man Steam Packet Company.

The Scottish Government continues to work under the interim Subsidy Control regime introduced by the UK Government on 1 January 2021 and provisions held within the EU-UK Trade and Cooperation Agreement. Alongside this, consideration has to be given to any further UK Subsidy Control obligations such as World Trade Organisation membership and commitments arising from international treaties and Fair Trade Agreements to which the United Kingdom is a party.

The UK Government introduced a Bill on Subsidy Control to Parliament on 30 June 2021 with a view to implementation of a permanent Subsidy Control regime.

Officials will continue to diligently work through the UK Government’s proposals to understand the impact on subsidies, including on ferry services.

Transport Scotland has been monitoring transport trends during the Covid-19 pandemic. This information is regularly published on the Transport Scotland website and can be found using the link: COVID-19 National Transport Trend Data . The Covid-19 Sub-National Reports provides travel trends on ferries.

We will work with all key stakeholders, including the trade unions, to ensure the most efficient and best value arrangement to deliver our key lifeline ferry services. An independent review analysing the existing governance structure is already underway and our consultants will be engaging with stakeholders shortly. The provisional outcomes of the review will be published around the end of the year when further engagement on potential options will take place.

Under the Emergency Measures Agreements (EMAs) in place, (a) Abellio ScotRail and (b) Serco Caledonian Sleepers Limited are not entitled to indemnification in the event of industrial action although the net difference between revenue and costs in any EMA period pass through to Scottish Ministers.

To the extent that industrial action increases the net cost to the Scottish Government it increases the need for further efficiencies and cost reductions given that funding, in the context of Covid, is severely constrained.

The MV Coruisk resumed normal timetabled services on the afternoon of Friday 16 July 2021 on the Oban – Craignure route.

The Prior Information Notice (PIN) referred to confirmed Ministers’ intention for Scotrail services to be delivered through a wholly owned company of the Scottish Ministers in terms of the Operator of Last Resort following expiry of the current ScotRail Franchise Agreement.

It is intended that Operator of Last Resort arrangements will provide a period of stability for passengers and staff while we assess the scale and pace of recovery from Covid 19 and future rail reform.

As the PIN was published on 31 March 2021, almost 2 months ahead of the UK Government’s delayed White Paper on Rail, there was considerable uncertainty around reform at the time. Accordingly, through the PIN, Ministers reserved the right to put OLR arrangements in place as appropriate, up to the maximum period of 10 years. It also indicated the envisaged direct award at that point was for a period of 3-5 years with any optional additional period(s) exercisable at the sole discretion of Ministers.

Although the White Paper has now been published, we are pressing the UK Government for further clarity on how their proposals, and timescales for implementation of future rail reform, will impact our aspirations for Scotland’s railways. This will help inform future decisions about the duration of the OLR arrangements, subject to the 10 year maximum referred to in the PIN.

In Scotland we are continuing to work under the interim Subsidy Control regime and provisions held within the EU-UK Trade and Cooperation Agreement. Draft legislation was laid in the UK Parliament on 30 June 2021. We will now take time to consider the draft legislation and reflect any new options that may be available for procurement of ferry services and/or impact on ferry fares policy.