From Karl Hunter, Shanklin:
As some may recall, (CP 28-05-21) I wrote an open letter to MP Bob Seely raising concerns regarding Wightlink's operation of the FastCat.
I am grateful for Mr Seely’s open reply (CP 18-06-21).
Although there is an argument that might look at some of Mr Seely’s points from a different perspective, overall, it’s clear he acknowledges and recognises the issues Islanders face with the ferry companies.
However, the first thing in Mr Seely's response that caught my eye was why Wightlink needed millions of pounds of public money to avoid bankruptcy?
- Read more: Wightlink CEO's response to critic and MP
I have looked at Wightlink’s accounts covering the past four years and they show over £59million net profit.
In the same period over £50 million (85 per cent of Wighlinks profit over the same period) was paid in dividends to Wighlinks parent company, Arca Shipping Limited.
The accounts also reference in 2006 Wightlink was subject to a restructuring that created a substantial reserve fund of over £101 million. The latest information shows that figure is now down to under £40 million. All this indicates Wightlink Ltd is a very lucrative company being stripped of cash by its parent company, hence why it needed to take taxpayers money to stay afloat. If some of those profits were managed more responsibly and retained by Wightlink there would be no need to take taxpayers money.
I also struggled with the statement made by Wightlink’s CEO, Keith Greenfield in last week's County Press “profits are needed to fund capital expenditure on new ferries and infrastructure so it’s hardly surprising that Wightlink needs higher profits than other businesses…”
I believe this statement to be misleading given Wightlink's accounts clearly show that the vast majority of Wightlink's net profits have not been used for capital expenditure, but instead have been and continue to be a dividend payout.
Wightlink’s slogan is “Part of Island Life” but aside from creating some jobs for Islanders and a few charitable discounts, if all profits are leaving for distant shores what is the value of Wightlink to the Island? If it wasn’t for Island businesses creating a desire to visit the Island the ferry operators would have significantly less revenue coming in. Where is the social responsibility in putting some of those profits back into the Islands economy?
Therefore, I question Mr Seely's statement that the current owners are better than the previous owners. As a point of interest £59 million pounds net profit over four years works out at an average of over £283,000 after tax every week. And so, Its hard not to concluded anything other than Wightlink is using us as their cash cow. I am open to be proven otherwise.
In the ensuing days after my letter, I heard from many Islanders who had much to say on the Wightlink debate. There were various viewpoints, but one recurring theme was quick to emerge... the cost, but not just the financial cost.
High ferry fares are leading to a social cost by restricting some families in our community from accessing the mainland, especially in the summer holidays and half-terms. It was sad to hear how some Islanders have regularly missed out on important family events such as weddings simply because they could not afford the ferry fare.
Straightaway I can hear the likely argument from some who say we choose to live on the Island and if we don’t like it, move, or those who say the ferry operators are businesses and have to make money. In some ways, I agree with those people. There is a sacrifice for living on this beautiful Island and yes businesses need to make money.
The problem arises when the sacrifice is too great and the cost disproportionately high, and I think we have arrived at that point.
The standard quick retort to this is comparing the cost of a return journey from the 1970s and ’80s when the routes were publicly owned and concluding in relative terms the fares are about the same.
However, as Mr Seely stated, it’s only comparative when comparing the bulk-buying of tickets today with single returns purchased over the counter back then. I’d suggest this makes it uncomparable given most Islanders don’t purchase ferry tickets this manner nor can many afford the outlay of bulk buying. Therefore, I feel it’s not a real argument for historical parity. Regardless, I never think this is a worthy argument in the first place given, even if it was just as costly back then, it doesn’t make it right. Is it not better to try and recognise and appreciate what Islanders are experiencing at the hands of our ferry companies here and now?
Using my circumstance as an example, every year in the summer holidays (excluding 2020) l drive my children to London to visit family. This year I will be travelling on August 7 and returning on August 14. A standard return on Wightlink at the time of writing leaving at 9.20am and returning at 1.40pm is £229. Unless I want to catch a 6.40am ferry and return on a 10pm ferry for £167.50. Conversely, various other departure times take the price up to £263.50.
This is where these frankly monstrous ferry fares impede some families from the freedom to travel to the mainland and why the social cost to some Islanders is too high.
Is it then the case that our ferry operators are not concerned with serving all members of our community and restricting reasonable rights of passage to a proportion of Islanders for whom travel off the Island has become exclusive rather than inclusive? And so in response to Mr Seely’s belief that Wightlink management understands their wider social responsibility to the Island, I’m afraid for me there is too much evidence that points to the contrary.
However, Mr Seely's letter details a list of improvements that he would like to see to address some of these issues, including implementing a better pricing policy to help some Islanders access the mainland when they need to. Wightlink’s accounts indicate there is ample room for a better balance to make this a reality. Some profit could be allocated to a social benefit fund subsidising or reducing Island fares while still generating a healthy return. I also support the idea of our ferry companies committing to a public service obligation showing their intentions to serve our community rather than making tens of millions from it.
This leaves the question: What can be done? A fixed link perhaps? Whether you are for or against a fixed link it could easily be 20 years away, if ever, and by then we’ll all have flying Teslas anyway.
I am behind Mr Seely’s desire for our ferries to be publicly owned. Perhaps there is a case for including our ferry links in the Great British Railway initiative? A public company shortly to be implemented by the Government that will take over the planning of train services, manage fares and ticketing. The trains will still be operated by private companies. A similar set-up that regulates Wightlink and Red Funnel in the interests of the public could provide a solution while holding ferry operators to account.
Another possible way forward might come via the Island's newly elected independent council. According to Mr Seely, the council has the authority to enact change. If you feel the ferry companies are not giving Islanders the service we deserve at an affordable price please consider taking up Mr Seely’s offer of writing to him. Alternatively, for those so inclined phil.jordan@iow.gov.uk is the email of the recently appointed Councillor for Transport and Infrastructure who I’m sure would also be delighted to hear your concerns and how you think our ferry companies could serve us better. Who knows, this might be a rare opportunity for Islanders to make a difference.
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