Firms fear transport woes are threat to their viability

Unreliable ferries could see Highlands and islands lose out on investment

NEARLY half of businesses in the Highlands and islands say a lack of reliable transport links presents a severe risk to their viability amid continuing problems with ferry services.

The “shocking” analysis comes as the Scottish Government’s Highlands and Islands Enterprise (HIE) agency, which has provided £15,000 of public money to allow a group of islanders to investigate taking over ferry routes from state-controlled ferry operator Calmac, has warned unreliable ferries could see future investment in key industries such as renewables and aquaculture go elsewhere.

This would see the area miss out on much-needed jobs and revenue at a time when sectors such as tourism are already suffering from the cost of living and staff shortages caused by Brexit.

A Highlands and Islands business panel survey orchestrated by HIE in June and July found 42 per cent of firms believe a lack of reliable transport was at least a medium risk to their business.

The study of more than 1,000 businesses and social enterprises found that more than two in three (66%) of tourism businesses were more likely to say transport was at least a medium risk to them.

Over half (53%) said workforce challenges were a risk to them and an earlier study found more than one in three (36%) said poor transport connections were contributing to those issues.

The majority (71%) of island companies have said that they rely on ferries.

When asked about the transport they use, the most important factor for businesses across the Highlands and islands was reliability (66%) and, for those dependent on the fleet, the resilience and reliability of services was considered particularly vital.

HIE has warned investors will look elsewhere if ferry connectivity and dependability are not resolved.

It comes as Transport Minister Jenny Gilruth committed to “urgently” convene the Islands Transport Forum as part of efforts to “improve our collective response to resilience on our islands”.

Her response came following complaints of a severe food shortage on the Uist islands, in the Outer Hebrides, because of a ferry breakdown down last week.

The breakdown meant there were no food stocks delivered to Uist for five days.

At the centre of the row are the continuing issues with the nation’s ageing ferry fleet breaking down, resulting in a string of cancellations and other disruption to services.

In 2022, around 17 of Calmac’s 31 working ferries deployed across Scotland were past their 25-year-old life expectancy. The oldest in the Calmac fleet is the Isle of Cumbrae, which is 46 years old.

Since the SNP came to power in 2007, the average age of Scotland’s ferries has soared from 17 to 24.

Back in 1974, a Calmac vessel was typically just 13 years old.

Meanwhile, two new vessels being built for Calmac, MV Glen Sannox and Hull 802, are still being built in the state-owned Ferguson Marine shipyard in Inverclyde, with the cost of their construction soaring from £97 million to nearly £340m and scheduled delivery more than five years late.

One ferry-user group campaigner says it is hard for mainlanders to understand the severity of the problems caused to communities and businesses on the islands due to poor ferry fleet resilience.

He said: “The survey gives a shocking picture of just how desperate businesses are and that mood is reflected in the communities who have to put up with constant disruption to their lives.

“The problem now is that some well positioned people are

concerned these issues keep being raised publicly because it is putting off visitors.

“However, the problems cannot and should not be ignored and while ferries may now belatedly be being commissioned, they are only replacing an ageing fleet.”

Shetlander Martin Johnson, director of strategy and regional economy with HIE, said that if things do not turn around over ferries, those looking to invest, particularly in renewables, aquaculture and in offshore oil and gas, will look elsewhere.

The Scottish Government aims to generate 50% of Scotland’s overall energy consumption from renewable sources by 2030 and by 2050 it aims to have decarbonised the energy system almost completely.

But Mr Johnson said: “When we look to the future, we’re aware of sectors offering not just opportunities to the island economies, but things like offshore wind and the development of Scotland’s hydrogen economy, aspects to do with space, the continued growth of aquaculture.

“I don’t think by any means the tourism sector has plateaued in terms of its economic benefits, and also there is the decommissioning of offshore oil and gas structure.

“All of these industries, to a large extent, will rely on good ferry connectivity, that resilience and reliability is absolutely there.

“And for some of these sectors, the players are multinational businesses.” He previously told MSPS: “The point we make there is that the boards of these multinational companies will have multiple investment decisions in all places all around the world.

“They will have choices where they invest their time, their effort and their cash.

“And if Scotland can’t demonstrate to these key sectors that the islands are a location for them to invest their capital, because they can rely or cannot rely on ferry connectivity, there is a risk that they won’t make investment decisions.

“So we won’t see the full economic benefit from offshore wind, from hydrogen from decommissioning, for example, in Scotland and in the island economies.”

The Harris Transport Forum has warned the Scottish Government that on the islands off the Western Isles, businesses were at the “point of extinction” and that there was “no confidence left in Calmac and the Government”.

A Transport Scotland spokesman said: “We share the desires of island communities for sustainable and effective ferry services and look forward to continuing our constructive engagement with them on future services and vessel replacements.

“As part of the forthcoming islands connectivity plan, we will set out a long-term investment programme for vessels and ports which the Project Neptune report called for and islanders need to see.

“Since this Government was elected in May 2021, we have bought and deployed an additional vessel in MV Loch Frisa in June, made significant progress in the construction of vessels 801 and 802, commissioned two new vessels for Islay, progressed investment in essential harbour infrastructure, and now we are delivering a further two new vessels.

“At the same time, we are continuing to work on pursuing all reasonable and appropriate opportunities to enhance capacity and resilience in the short term through second-hand vessels.

“We have made clear that island communities, businesses and residents deserve better.

“The current level of service is not good enough and we are working hard to deliver the service and changes they need to see.”