Chamber and committees

I regret that some names were omitted from the list provided in answer to question S2W-18191. I am advised that the full list of organisations which expressed an interest in bidding for the new Northern Isles ferry contract is as follows:

ASP-Seascot Ship Management Ltd

Aberdeen Harbour Board

Adsteam (UK) Ltd

Anglo-Eastern Ship Management (UK)

Braeside Shipping

Burness

Caledonian MacBrayne

Clyde Marine Group

Harrisons (Clyde) Ltd

Irish Continental Group plc

Milford Haven Port Authority

Nor-Cargo Ltd

Northern Marine Management Ltd

NorthLink Orkney & Shetland Ferries Ltd

Orkney Islands Council

P&O European Ferries (Irish Sea) Ltd

Pentland Ferries Limited

Scot Ferries Ltd

Sea Containers

Serco Denholm

Smit International (Scotland) Ltd

Smyril Line Ltd, Shetland Isles

Stephenson Clarke Shipping Ltd

Streamline Shipping Group

V. Ships

Western Ferries.

In accordance with standard commercial practice, all three companies that have been invited to tender for the Northern Isles lifeline ferry contract will be expected to finance their own bidding costs. As its owners, we would be content for CalMac to use its cash reserves to finance bidding costs. However, we would expect that were the company’s bid to be successful, it would recover those bidding costs over the contract period, plus a return equivalent to the interest that might reasonably be expected were that amount of the company’s reserves to have been invested commercially over the contract period.

It would be prejudicial to CalMac’s commercial interests to disclose how much CalMac intended to spend on bidding costs. Comparable information from other bidders would not be available to CalMac and it is essential that all bidders should be treated equally.

The next Northern Isles contract has been offered for a period of six years, the maximum time allowable under the Community guidelines on state aid to maritime transport for a public service contract. The Executive expects that there will be a continuing need to support lifeline services to the Northern Isles for the foreseeable future, and that there will be a further competitive tender in time for the end of the next contract.

I refer the member to the answer to question S2W-19153 on 21 September 2005. All answers to written parliamentary questions are available on the Parliament's website, the search facility for which can be found at http://www.scottish.parliament.uk/webapp/wa.search.

Ministers regarded the choice of date for introducing the smoking restrictions as a matter for them and consequently the Executive did not seek the views of members of the National Smoke-free Areas Implementation Group on this issue. The start of British Summer Time had tentatively been mooted for some time as a possible date for the law to take effect, drawing on the positive experiences of a similar start time for smoke-free legislation in both Ireland and New York.

The Executive considered a range of dates and subsequently selected 26 March 2006 for the introduction of the relevant provisions of the Smoking, Health and Social Care (Scotland) Act 2005.

I refer the member to the answer to question S2W-18709 on 22 September 2005. All answers to written parliamentary questions are available on the Parliament’s website, the search facility for which can be found at: http://www.scottish.parliament.uk/webapp/wa.search.

In 1993, the then Scottish Office commissioned a Shipping Subsidies Review to find a longer term solution to the financial viability of ferry services to Orkney and Shetland. That review concluded that Tariff Rebate Subsidy (TRS), the mechanism then used to support P&O Scottish Ferries’ Northern Isles operations, was no longer an adequate subsidy system for the support of shipping.  The main reasons were that: TRS failed to provide for the replacement of vessels, as it could not guarantee the profitability required for such major investments or the security needed to attract a long-term commitment to the routes; TRS encouraged excess capacity and competition, particularly from freight-only competitors, that depressed profitability, threatening the long-term viability of all shipping operations; TRS could not compensate for any fall in traffic revenues, and, as PO Scottish Ferries’ revenues from freight carryings fell due to competition, so did its overall profitability to the point that it was no longer commercially viable.

The Shipping Subsidies Review Report recommended that The Scottish Office should introduce new arrangements based on a block grant set to reflect estimated volumes, revenues and costs.  Scottish Office Ministers announced in October 1994 their decision to award a block grant for the period 1997-2002 and an open competitive tendering exercise began in June 1995. Three bids were received and after thorough consideration, Scottish Office Ministers concluded that the bid from P&O Scottish Ferries offered the best value for money. Scottish Office Ministers subsequently agreed that P&O Scottish Ferries should be paid a basic annual block grant, subject to clawback arrangements should the company’s profits exceed forecasts.

The Scottish Executive will undertake a range of activities to help to build compliance in the run up to the introduction of the smoke-free legislation in March 2006. This will include an advertising campaign, a mail drop to every household in Scotland, and guidance to businesses and organisations on how to comply with the new law.

It is currently estimated that these activities will cost in the region of £1.5 million.

The Executive did not consult on the specific issue of the date of implementation.