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Wednesday, 24 January, 2001, 06:33 GMT
CalMac plans to be unveiled
Calmac ferry
The CalMac plan needs European Commission approval
The Scottish Executive is to tell the European Commission that Caledonian MacBrayne (CalMac) should remain under public ownership.

The transport minister, Sarah Boyack said the Executive plans to continue subsidies to the ferry network in order to protect fares and levels of service.

The minister's proposals for the future of the company are expected to come before the Commission on Wednesday.

Fears for the future of the network grew after EC law required the Executive to put all publicly subsidised ferry routes out to tender.

Sarah Boyack
Transport Minister Sarah Boyack
Ms Boyack launched a consultation exercise last year to take on board public views about the future of the network.

The minister has now decided that maintaining an integrated service from CalMac will best serve the Scottish public.

She also believes this will prevent private operators from "cherrypicking" the most profitable routes.

European Commission

Under the proposals CalMac will remain in public ownership and subsidies will continue on loss-making routes.

The minister is also proposing that a new company is set up to own the vessels and lease them to the operator.

The European Commission must agree the plans but Ms Boyack says she is confident the new set-up will satisfy European competition law:

"We are required under the European Community's rules to consult the commission on the proposals and therefore they are provisional at this stage and subject to the commission's approval and further investigation," she said.

"If approved by the commission, these measures would ensure that we will be able to continue to subsidise them in the future and safeguard the services on which these communities depend."

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See also:

22 Dec 00 | Scotland
CalMac clinches ferry deal
01 Sep 00 | Scotland
Fears voiced over ferry contract
26 May 00 | Scotland
CalMac given morale warning
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