Friday, 22 February 2008

Road Equivalent Tarriff

I'll put my foot into another pan full of hot potatoes, this time good old RET.

RET means that ferry trips are charged according to the number of seamiles covered by the ferry, multiplied by 60p and augmented with a £5 surcharge. According to newsreports out today, this will cover all ferries TO the Western Isles. Note, not WITHIN the islands.

Although it is nice to anticipate that fares will be slashed by up to half, there is a sting in the tail. Calmac operates its ferries at an annual operating loss of £32 million. This is covered by government subsidies. If Calmac's fare revenues are decreased courtesy RET, you'd expect the subsidy to INcrease. Subsidies are ultimately funded by taxpayers, and, yes, that includes residents of the Western Isles.

I'm not totally sour grapes about this scheme, it should entice more visitors and businesses to the islands. And that might offset Calmac's reduction in revenue. Problem is that ferries have a limited capacity, and can carry only so many vehicles at a time.

Perhaps the Sunday sailings will now be introduced on the Ullapool to Stornoway route to make up for that deficit, yes, I can now see the reasoning behind this.

1 comment:

  1. "My maths is rubbish, but the formula suggests a price of £18.80 for Uig-Tarbert instead of £40. And all those people who leave their cars at Uig and cross on foot might be tempted to bring the car across, spend longer on the islands, and spend more money. Could be just the tonic the islands need."

    Malkie from Glasgow

    "Apparently, it'll be great for the runs like Ullapool/Sy and Uig/Tarbert... but for those going on Barra/ Oban, it will be more expensive than what they are already paying apparently. The passenger rates go down, but the vehicle charge goes up! (it's an 88 mile trip, which is why they aren't testing it in Shetland as it's even further out). It's a bit of a sore point with the Barrachs, understandably. The RET won't come into effect until after the tourist season is well and truly over - that is October! So don't expect to hear anything regarding Sunday ferries until then either. :-("

    Heb Life from Lewis