By Mike Macleod, Labour candidate for Orkney Constituency.
Ever since I started canvassing in Orkney, a question that keeps coming up is – why can’t Orkney get the reduced fares that would come from Road Equivalent Tariff?
Under RET ferry fares on the Clyde and Hebrides services are based on the cost of driving the equivalent distance by road plus a fixed fee. Stornoway-Ullapool (2 hours 40 mins) single foot passenger fare is £12.30 – the Northlink and Pentland prices are noticeably higher for shorter routes.
From the start I’ve explained that RET is not a realistic option and in fact is on its way out on the West Coast. This article aims to explain why.
Starting with the CalMac 2025 Annual Report, now available at:
https://corporate.calmac.co.uk/en-gb/about-us/reports-and-resources/annual-report-2025
A few key statistics:
In 2025, CalMac received £88.2 million in fares and other associated services. To balance the books, they received £240.5 million from the Scottish Government. That is, for every pound CalMac received in revenue, this required a further £2.72 approx in Scottish Government Subsidy.
In fact those who work on the ferries are not employed by CalMac directly, but by a wholly-owned Channel Islands Agency company, to obtain favourable tax treatment. These “Agency Staff Costs” are £98.8 million. With the £42.6 million paid for directly employed staff, it becomes apparent CalMac pays out over £141 million in staff costs annually. Massively dwarfing the £88-odd million in actual revenue and completely unsustainable.
When RET was introduced between 2008 and 2015 apparently the estimate was this would cost the Scottish Government only £25 million per year. Somehow this has morphed into almost ten times that amount. And this for a ferry service which on many routes is profoundly unsatisfactory, owing to frequent cancellations and ferry outages.
One mistake made by the SNP seems obvious: stimulating demand for West Coast ferry travel with RET while not ordering new ships. Resulting in ferries being used past their expected lifespan and reliability deteriorating accordingly. Once the four ferries built in Turkey arrive hopefully reliability will improve.
However this masks an underlying and more persistent issue. Over the years, CalMac management seems to have been outmaneuvered and out-negotiated by the Unions, who obtained excellent terms for their members and also persuaded CalMac/CMAL to accept the concept that the large monohull vessels should have individual cabins for crew on board. Effectively meaning an extra deck for each ship. Significantly adding to the ship’s weight and operating costs. (It must be stressed that the Unions have acted reasonably and as they should, in getting a good deal for their members.)
Naturally the new ships are larger, requiring expensive harbour modifications in some cases.
Since the new Turkish ferries, the Glen Rosa, etc. all follow this design, once they enter service, higher costs are baked in over each ship’s lifespan. And that’s before anyone even thinks about oil at $150/barrel.
As has been said by others, what we need is maritime buses. Whereas CalMac/CMAL seem determined to give us mini-cruise ships.
Once the election is out of the way, doubtless we can expect above-inflation fare rises on the West Coast routes as whoever is in power tries to reduce the ferry deficit somehow.
One practical way forward (to stop the deficit getting worse) would be –
- Abandon the large monohull-with-accommodation-aboard-for-crew model. Instead base new ferries on the design of MV Pentalina, a catamaran with no wasted space on board.
- Build permanent staff accommodation ashore, which will outlast a number of ships. This one-off cost immediately reduces the size, complexity and cost of all future ship build for that route. And a less heavy ship requires less diesel every time it sails, thereby reducing operating costs permanently.
- Reduce the hot food offering to the simple Pentalina offering of coffee/tea and a filled roll. No substantial kitchen reduces build complexity and staffing costs.
- Where practical, adopting the Pentalina design (with only one bow door and vehicles, once aboard, turning in a semi-circle to face the exit) should reduce build and maintenance costs.
The free-enterprise solution would be to put CalMac into Administration, sell the routes to the higher bidder, sack half the workforce and reduce the wages of those left. But this means a protracted and bitter ferry strike with economic ruin for the islands. And there is no political will for that.
So we are stuck with the CalMac Money-Eating Monster consuming more and more.
Therefore there is no realistic prospect of RET for Orkney. And if you ever wondered why there is such reluctance by the Scottish Government to fund inter-island ferries for Orkney and Shetland, this is easily explained by the pressure which the massive CalMac mess puts on the transport budget.
Wish I could promise a quick fix, but whoever is in Government after May 7th has their work cut out with ferries.
Elections to the Scottish Parliament take place on Thursday 7 May.
Orkney Constituency – 5 candidates:
- John William COUPLAND – Reform UK
- Jamie HALCRO JOHNSTON – Scottish Conservative and Unionist Party
- Robert Fraser LESLIE – Scottish National Party (SNP)
- Mike MACLEOD – Scottish Labour Party
- Liam Scott MCARTHUR – Scottish Liberal Democrats
Highlands and Islands Region – Candidates:
| Name of Party | Description of Party | Candidates on Party List (in order to be elected) |
|---|---|---|
| Advance UK | 1. Matt Sheppard 2. Steve Skerrett | |
| Alliance to Liberate Scotland | Alliance to Liberate Scotland For Independence | 1. Brian Nugent 2. Andrew Ross Macdonald 3. Kenneth Mackenzie 4. Laura Hansler 5. Allan Duffy 6. Flora Badger |
| Independence for Scotland Party | Independence for Scotland Party, Direct Democracy | 1. Fiona Nelson |
| Independent Green Voice | Independent Green Voice – Organic, Local, Democratic | 1. Nicola Siddall |
| Reform UK | 1. Vic Currie 2. Max Bannerman 3. Amanda Hampsey 4.Fred Campbell 5.Malcolm McTaggart 6. Jon Whitton 7. John Coupland | |
| Scottish Christian Party “Proclaiming Christ’s Lordship” | 1. Donald MacLeod Boyd | |
| Scottish Conservative and Unionist Party | 1. Tim Eagle 2. Jamie Halcro Johnston 3. Helen Crawford 4. Ruraidh Stewart 5. George Macpherson 6. Peter Wallace 7. Donald Mackenzie 8. Douglas Barnett | |
| Scottish Family Party | Scottish Family Party – Christian values | 1. Kenny Stone 2. Allan MacEachen 3. Rachel Michelle Gibson 4. Eva Morrice 5. Harriet Amelia Mary Woolmore |
| Scottish Green Party | Vote Scottish Greens – Let’s demand better | 1. Ariane Burgess 2. Kristopher Leask 3. Kate Willis 4. Dræyk Van Der Hørn 5.Alex Armitage 6. Anne Thomas 7. Julie Christie |
| Scottish Labour Party | Scottish Labour – Scotland Needs Change | 1. Isla McCay 2. Donald MacKinnon 3. Eva Kestner 4. John Erskine 5. Mike MacLeod 6. Callum George 7. Shaun Fraser 8. David Blair |
| Scottish Liberal Democrats | 1. Morven-May MacCallum 2. Alan Reid 3. Declan Gallacher 4. Angela Margaret MacLean 5. Robert Denis James Rixson 6. Guy Grieve 7. Fiona Bennett | |
| Scottish Libertarian Party | 1. Nathan Lumb | |
| Scottish National Party (SNP) | 1. Maree Todd 2. Robert Leslie 3. Emma Roddick 4. Hannah Mary Goodlad 5. Eilidh Munro 6. Jérémie Fernandes | |
| Scottish Rural Party | 1. Alasdair Fletcher 2. Ruaridh Ormiston | |
| Scottish Socialist Party | Scottish Socialist Party – Independent Socialist Scotland | 1. Willie Hamilton 2. Brenda Nicholson |
| Workers Party of Britain | Workers Party – Scotland | 1. Syed Hussain |
| Independent | Duncan Macpherson; Mick Rice |
