Post by ferryfast admin on May 10, 2012 10:13:02 GMT -5
B.C. Ferries faces rough sea despite cash boost
Another $80 million in subsidies - but fare hikes, cutbacks loom
By Rob Shaw,
Times Colonist
May 10, 2012 5:48 AM
www.timescolonist.com/Ferries+faces+rough+despite+cash+boost/6597879/story.html#ixzz1uToFysre
The provincial government is giving B.C. Ferries a multimillion-dollar cash boost, but travellers can still expect rising ticket prices and looming cutbacks in sailings and service.
Another $80 million in taxpayer subsidies will be given to the quasi-private ferry corporation over the next four years, Transportation Minister Blair Lekstrom announced Wednesday. That's on top of the more than $150 million a year the government already contributes.
But the cash alone won't be enough to drop ticket prices or save little-used coastal ferry routes from the chopping block, at a time of slumping ridership and plans for new ships and terminals that will cost billions of dollars.
Uncomfortable decisions will have to be made, Lekstrom said.
"I will not suger-coat the issue that we are challenged with B.C. Ferries. I don't think anybody was under the expectation - that government would step up with new tax dollars and solve all the issues."
Ferry fares rose 4.15 per cent in April. Ticket prices have jumped more than 47 per cent over the past nine years on major routes, and 80 per cent on minor ones.
The government expects B.C. Ferries to find $15 million in savings, as well as cut $30 million in service over four years, said Lekstrom. "You cannot continue to operate a B.C. Ferries system with routes operating at less than 30 per cent capacity," he said.
B.C. Ferries CEO Mike Corrigan called the government request "reasonable" and said the cuts "won't [have] much of an effect on people." The corporation previously proposed dropping 400 sailings, but Corrigan said the latest plan is 100 sailing reductions on major routes this year, mainly from late-night service. That represents less than one per cent of majorroute sailings annually.
B.C. Ferries will talk with coastal communities to identify other routes to reduce, said Corrigan.
"There may be some communities that are willing to pay a little bit more in order to keep the service that they have, but we have to go out and do that consultation," he said.
The government also introduced legislation Wednesday in response to a January report by B.C.'s independent ferry commissioner, Gord Macatee. The legislation will give Macatee more power to set fare hikes, allow service cuts and approve B.C. Ferries' $2.5-billion capital plan.
It also removes a ban on cross-subsidization, allowing B.C. Ferries to use money-making routes to pay for less profitable sailings, and meaning any future rate hikes apply to all routes equally.
"With the amount of money that the government has announced today, the affordability is going to be vastly better than what we were faced with a year ago," said Macatee. He had recommended that B.C. Ferries keep rate hikes to the rate of inflation.
That's a goal for the future, but Lekstrom said it's not possible in the next few years.
rshaw@timescolonist.com
_____________________
BC Ferries
www.bcferries.com/
_____________________
Another $80 million in subsidies - but fare hikes, cutbacks loom
By Rob Shaw,
Times Colonist
May 10, 2012 5:48 AM
www.timescolonist.com/Ferries+faces+rough+despite+cash+boost/6597879/story.html#ixzz1uToFysre
The provincial government is giving B.C. Ferries a multimillion-dollar cash boost, but travellers can still expect rising ticket prices and looming cutbacks in sailings and service.
Another $80 million in taxpayer subsidies will be given to the quasi-private ferry corporation over the next four years, Transportation Minister Blair Lekstrom announced Wednesday. That's on top of the more than $150 million a year the government already contributes.
But the cash alone won't be enough to drop ticket prices or save little-used coastal ferry routes from the chopping block, at a time of slumping ridership and plans for new ships and terminals that will cost billions of dollars.
Uncomfortable decisions will have to be made, Lekstrom said.
"I will not suger-coat the issue that we are challenged with B.C. Ferries. I don't think anybody was under the expectation - that government would step up with new tax dollars and solve all the issues."
Ferry fares rose 4.15 per cent in April. Ticket prices have jumped more than 47 per cent over the past nine years on major routes, and 80 per cent on minor ones.
The government expects B.C. Ferries to find $15 million in savings, as well as cut $30 million in service over four years, said Lekstrom. "You cannot continue to operate a B.C. Ferries system with routes operating at less than 30 per cent capacity," he said.
B.C. Ferries CEO Mike Corrigan called the government request "reasonable" and said the cuts "won't [have] much of an effect on people." The corporation previously proposed dropping 400 sailings, but Corrigan said the latest plan is 100 sailing reductions on major routes this year, mainly from late-night service. That represents less than one per cent of majorroute sailings annually.
B.C. Ferries will talk with coastal communities to identify other routes to reduce, said Corrigan.
"There may be some communities that are willing to pay a little bit more in order to keep the service that they have, but we have to go out and do that consultation," he said.
The government also introduced legislation Wednesday in response to a January report by B.C.'s independent ferry commissioner, Gord Macatee. The legislation will give Macatee more power to set fare hikes, allow service cuts and approve B.C. Ferries' $2.5-billion capital plan.
It also removes a ban on cross-subsidization, allowing B.C. Ferries to use money-making routes to pay for less profitable sailings, and meaning any future rate hikes apply to all routes equally.
"With the amount of money that the government has announced today, the affordability is going to be vastly better than what we were faced with a year ago," said Macatee. He had recommended that B.C. Ferries keep rate hikes to the rate of inflation.
That's a goal for the future, but Lekstrom said it's not possible in the next few years.
rshaw@timescolonist.com
_____________________
BC Ferries
www.bcferries.com/
_____________________