Which ferries or air services operating within the British Isles receive public subsidy (including Isle of Man and Channel Islands)?

[geoffk]

Not sure if there has been an earlier thread bringing all these together. Most will be routes linking the Scottish mainland with the islands but there is a recent thread about the withdrawal of Cornwall Council from supporting Newquay - Gatwick flights.

 

[zwk500]

Greenwich Ferry? It's free to use, although not sure if TfL have enough operating profit to cross-fund or get alternative revenue like advertising.

Do the ferries have to be wholly within the British Isles to meet the thread criteria? (i.e. no cross-channel or north sea routes)

 

[Sir Felix Pole]

Most of the Caledonian Macbrayne routes in Scotland receive public subsidy.

 

[Arriva Fan]

Most of the Caledonian Macbrayne routes in Scotland receive public subsidy.

All of them, including Gourock to Dunoon. Only the Vehicle Ferry element was operated commercially.

Northlink Ferries and Rathlin Island Ferry are both Subsidised.

 

[signed]

The Manche Iles Express ferry (offerring both Normandy and inter Channel island crossings) is subsidized, as well as the Jersey to Alderney service

 

[stadler]

The ferry run by DFDS from Newhaven to Dieppe is subsidised by the Syndicat Mixte De Promotion De L Activite Transmanche which is a state owned agency owned jointly by the Dieppe commune government and the Seine Maritime department government and the Normandy region government. As a result this route has the cheapest and best value England to France fares. The foot passenger fares are amazing value.

 

[geoffk]

The ferry run by DFDS from Newhaven to Dieppe is subsidised by the Syndicat Mixte De Promotion De L Activite Transmanche which is a state owned agency owned jointly by the Dieppe commune government and the Seine Maritime department government and the Normandy region government. As a result this route has the cheapest and best value England to France fares. The foot passenger fares are amazing value.

interesting. I had expected all the cross-channel ferries to be fully commercial.

 

[stadler]

interesting. I had expected all the cross-channel ferries to be fully commercial.

Newhaven to Dieppe is the one and only subsidised cross channel route. It is indeed very rare to see such a subsidised service. It was always commercially run for decades up until the year 1998 and then the joint P&O Stena Line operator decided to scrap the route due to decreased usage since the Channel Tunnel railway opened. That is why the Dieppe commune government and the Seine Maritime department government and the Normandy region government got together and formed this new agency to fund and contract the route and in 2001 it reopened. So in 2026 we are now in the 25th year of subsidised operation. It runs almost like a bus franchise or rail franchise. Syndicat Mixte De Promotion De L Activite Transmanche (the French state owned agency) fully own both ferries (and DFDS lease them as part of the contract) and they set the livery of the ferries (so DFDS are not allowed to paint the ferries in to their own livery) and they also set most of the fares. Foot passengers are charged a fixed set price regardless of whether you buy with cash on the day at the ferry port or book in advance. All of the other cross channel ferry routes are fully commercial with dynamic pricing rather than fixed fares. It is a rather unique ferry operation. But i am glad that Newhaven to Dieppe continues to be subsidised as it is by far the best cross channel route. It is a very well run operation.

 

[izvor]

Syndicat Mixte De Promotion De L Activite Transmanche (the French state owned agency) fully own both ferries (and DFDS lease them as part of the contract) and they set the livery of the ferries (so DFDS are not allowed to paint the ferries in to their own livery) and they also set most of the fares.

...and I understand they also own the port of Newhaven - can you confirm?

Agree it is a very useful and good value service, if you are not in a hurry - the parallel fast ferries were withdrawn some years ago.

 

[stadler]

...and I understand they also own the port of Newhaven - can you confirm?

Agree it is a very useful and good value service, if you are not in a hurry - the parallel fast ferries were withdrawn some years ago.

Yes that is correct. Newhaven Port is fully owned by them as well. They purchased it in 2001 at the same time that that they started subsidising the Newhaven to Dieppe ferry route.

 

[Ploughman]

Are the services to the Scilly Isles supported?

 

[Devonian]

Are the services to the Scilly Isles supported?

Normally not: they received emergency grants during the first part of the Covid-19 pandemic, but are otherwise self-funded, cross-subsidising the air services with revenue from the shipping. The Isles of Scilly Steamship Group, which run the aeroplane services, passenger ferry and freight shipping to and from the mainland, also turned down public funding offered for new ships, preferring to borrow the funds privately and service the debt through the fares, which caused an outcry on the islands. With an almost total monopoly service - effectively only the helicopter service is in competition - the fares have long been a bone of contention, and the Council of the Isles of Scilly have argued for public subsidy in the past.

 

[TheWierdOne]

Normally not: they received emergency grants during the first part of the Covid-19 pandemic, but are otherwise self-funded, cross-subsidising the air services with revenue from the shipping. The Isles of Scilly Steamship Group, which run the aeroplane services, passenger ferry and freight shipping to and from the mainland, also turned down public funding offered for new ships, preferring to borrow the funds privately and service the debt through the fares, which caused an outcry on the islands. With an almost total monopoly service - effectively only the helicopter service is in competition - the fares have long been a bone of contention, and the Council of the Isles of Scilly have argued for public subsidy in the past.

Have the Isles Council tried to offer subsidy and IoSSG have turned it down, or are the Council asking someone else to provide the subsidy?

 

[Devonian]

Have the Isles Council tried to offer subsidy and IoSSG have turned it down, or are the Council asking someone else to provide the subsidy?

The Council of the Isles does not have a large enough budget to offer significant subsidy itself. In 2012 the Council issued a report asking for government funding for the IoS routes similar to the subsidy applied to the Scottish island routes, but the request was turned down by the government. In 2021 the Council secured UK government funding of £48.1 million for the replacement of the ships and harbour upgrades, but the funding was turned down by the IoS Steamship Group.

 

[LucyP]

Aurigny is owned by the States of Guernsey and makes a loss, so that is a subsidy. IOMSPC makes a profit. Are Loganair still subsidised on any IOM routes or are they now all commercial?

 

[Cloud Strife]

All of them, including Gourock to Dunoon. Only the Vehicle Ferry element was operated commercially.

One major issue with the CHFS contract is that it's not very clear as to how much subsidy is actually required for individual routes.

For instance, it wasn't until the Skye Bridge came about that it was discovered that the Kyle of Lochalsh - Kyleakin service was profitable to the tune of around a million pounds a year.

There's a general belief that Arran and possibly Islay services are profitable, but as the subsidy is paid for the route network as a whole, CalMac (the company) have no interest in disclosing the facts about the operations.

While I don't advocate breaking up the network, there's a strong case for suspicion where Arran is concerned.

 

[joncombe]

I would argue most or perhaps all flights operated by Aurigny are subsidised because the airline is owned by the Guernsey Government and makes a multi-million pound loss each year, which is picked up by the Government there. Of course I don't think they provide a breakdown of routes so it is possible some of their routes are proftiable. I think the Guernsey to Alderney ferry is subsidised too and I think the Manche Illes Express ferries from France are also subsidised by the Channel Islands governments.

 

[Tetchytyke]

The Isle of Man Steam Packet is owned by the Isle of Man Government but it makes a profit.

The Isle of Man Government separately pay subsidy to Loganair for their flights to London Heathrow and London City. Loganair also has the patient transfer contract, which isn't a subsidy but it certainly helps the commerciality of the routes to Manchester and Liverpool.

 

[Shimbleshanks]

Greenwich Ferry? It's free to use, although not sure if TfL have enough operating profit to cross-fund or get alternative revenue like advertising.

Do the ferries have to be wholly within the British Isles to meet the thread criteria? (i.e. no cross-channel or north sea routes)

Woolwich Ferry, not Greenwich

 

[The exile]

One major issue with the CHFS contract is that it's not very clear as to how much subsidy is actually required for individual routes.

Since almost all of the routes need to be there anyway, what does it matter?

 

[Shimbleshanks]

The 'Ieuanair' route between Anglesey and Cardiff was subsidised before being axed a few years ago.

 

[Arriva Fan]

CalMac Ferries on the whole made a Profit in 2024.

There will be profitable/breakeven Routes, but those will allow CalMac to reduce subsidy needed to Operate the loss making Sailings/Routes.

Profitable or not, every one of their Routes is a lifeline. Splitting would make zero sense.

 

[philthetube]

The Knott end ferry is subsidised.

 

[Cloud Strife]

Since almost all of the routes need to be there anyway, what does it matter?

The problem is the lack of transparency over what subsidy is actually needed for specific routes. For instance, if Ardrossan-Brodick is commercially viable without subsidy, then it should be debundled from the CHFS contract, because a private (or even public) operator can carry out sailings on commercial terms.

It's obvious that many routes will never be commercially viable by themselves, but I think it's right to suspect that some trickery is going on with Ardrossan-Brodick and Kennacraig-Islay and the subsidies that are actually needed. The issue lies in Edinburgh: no-one has any interest in actually allowing CalMac routes to become commercial ones. It's a problem for island communities, because they need more sailings and they're willing to pay for them, but no-one can enter the market because CalMac (or really, the Scottish Government) simply put more ships on the route or increase sailings whenever there's a threat of an alternative operator emerging.

It's not an easy thing to fix, but I think the most reasonable outcome is that Western Ferries asked the Scottish Government for: a guarantee that they wouldn't increase sailings or reduce fares. This way, the lifeline services would stay intact, and yet private operators would be able to compete with some security that they simply weren't going to get outspent by a state-owned incumbent operator. For instance, on Kennacraig-Islay, a private operator could probably run some barebones service to Islay which would be very much targeted at the whisky industry. I'd expect very basic vessels and not much else, possibly even running to Troon or Stranraer. But they won't do it without that guarantee, because there's such a long history of CalMac and dirty tricks.

 

[Tetchytyke]

It's obvious that many routes will never be commercially viable by themselves, but I think it's right to suspect that some trickery is going on with Ardrossan-Brodick and Kennacraig-Islay and the subsidies that are actually needed. The issue lies in Edinburgh: no-one has any interest in actually allowing CalMac routes to become commercial ones. It's a problem for island communities, because they need more sailings and they're willing to pay for them, but no-one can enter the market because CalMac (or really, the Scottish Government) simply put more ships on the route or increase sailings whenever there's a threat of an alternative operator emerging.

The ferry service to islands is always a delicate ecosystem.

Whilst a route such as Ardrossan/Troon to Brodick will likely to be profitable enough to support one operator all year around, I would be very surprised if it would be profitable enough to support two. I doubt the routes from Lochranza will be profitable.

If you allow a second operator to muscle in on commercial terms then that operator, entirely reasonably, will only want to operate at profitable times. They will run at peak times and be nowhere to be seen at times of low demand. But because of simple supply and demand, extra capacity at busy times reduces yield.

Fine, but in many cases the higher yield during the peak season is what sustains the service during lower yield periods in the low season. All that happens is that the profit which sustained the low season service is gone and the subsidy required for the low season service increases.

Going back in history, but competition in the early 1980s on the ferries to the Isle of Man resulted in both companies (Manx Line and the Steam Packet) pretty much going bust. Enough profit for one operator, but not enough for two. They only survived by merging.

 

[Ailsa_Craig]

Hythe ferry which connects the town of Hythe to Southampton which ceased running on 22/8/24 owing to major damage to the pontoon. No information as to when or if it will ever run again

 

[geoffk]

Some interesting replies and more complicated than I thought.

 

[izvor]

The passenger ferries between Harwich, Felixstowe and Shotley are subsidised by Essex and Suffolk CCs and Tendring District Council. The nearby Bawdsey ferry is subsidised by Suffolk CC and other local stakeholders.

 

[Cloud Strife]

Whilst a route such as Ardrossan/Troon to Brodick will likely to be profitable enough to support one operator all year around, I would be very surprised if it would be profitable enough to support two. I doubt the routes from Lochranza will be profitable.

I think the best solution for Ardrossan-Brodick would be to have a lifeline contract which would be for locals only, with excess capacity sold only on the day before sailing to the general public. The lifeline contract/timetable/capacity would be set for a period of 10 years, and it would essentially cover the morning and afternoons, with the midday sailings being freight only.

A private operator would then be able to step in and run commercial sailings with the guarantee that the state won't interfere in their investment. Essentially, you'd allow a private operator to take advantage of the demand, but you'd still ensure that the islanders had a service with capacity for them.

Lochranza will never be profitable, but I doubt this would heavily interfere with the Brodick routes anyway.

Going back in history, but competition in the early 1980s on the ferries to the Isle of Man resulted in both companies (Manx Line and the Steam Packet) pretty much going bust. Enough profit for one operator, but not enough for two. They only survived by merging.

Yes, this is why I think there needs to be a state-owned lifeline operator to ensure that the island always has service regardless of what happens with a commercial operator. We know Arran has the demand for two large ships year-round, so if a commercial operator takes over midday sailings and a second ship's capacity, perhaps the tendered service could then be eliminated and replaced with a fully commercial service.

But even as I've just typed that out, I have the feeling that the easiest solution is simply to leave it alone.