New ferry contract opens the door for service cuts

NANAIMO – Minor, northern routes expected to take the brunt of $30 million in service reductions

New amendments to the Coastal Ferry Act will see a total of $30 million in service cuts and could affect virtually any route B.C. Ferries serves.

B.C. Ferries commissioner Gord Macatee released the guiding principles of the amendments earlier this month. The province will take those principles into account when it consults with coastal communities served by the ferry service, with a deadline set for June 30, 2013 for proposals to be submitted to Macatee.

The amendments expire with the Performance Term 3 contract on March 31, 2016.

The guiding principles indicate routes that could be affected by the service cuts include those that: experience significant financial losses annually; report annual capacity utilisation levels below 55 per cent; involve multiple ports; and are anticipating major capital expenditures.

Adjustments will also take into account the need to ensure basic ferry service for travel to school, work and significant community events.

John Hodgkins, the Ferry Advisory Committee chairman representing Gabriola Island, said it’s too soon to know how the amendments and impending consultations will affect service levels for Route 19, which services downtown Nanaimo to Gabriola’s Descanso Bay.

“Trying to unpick the guiding principles line by line is likely to give a misleading picture, but it would be fair to say that the prospect of achieving a $26-million cost reduction in [effectively] two to 2.5 years is a tough one,” wrote Hodgkins in an e-mail to the News Bulletin. “And although the report doesn’t say so in so many words, the assumption is that much of this is expected to come from the minor and northern routes.”

About $4 million in savings was already agreed upon for major routes to and from the mainland.

Hodgkins said he doubts the Nanaimo-Gabriola route will escape unscathed, but the depth of service cuts remains to be seen.

Route 19 operates at about 40-per cent capacity annually.

For the first six months of 2012, B.C. Ferries reported a three-per cent reduction in vehicle traffic and a reduction of 1.5 per cent in overall passenger numbers. While bleak, it is an improvement over the first half of 2011, which saw vehicle traffic drop by 5.6 per cent, with passenger traffic down 6.8 per cent.

Those numbers are similar up and down the coast, which could present a challenge for Macatee if he is going to keep the fare cap below the target of four per cent for next year.

“There is a lot we don’t know at the moment and at this stage, we can only wait and see what happens,” said Hodgkins. “What we do know is that BC Ferries is working with the province to assess the potential cost savings … And that they are focusing particularly on lightly used early morning and late evening sailings, where there is the greatest potential to reduce overtime payments with minimal revenue loss.”

The province is expected to begin the consultation process with coastal communities in September or October.

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