Ferry Service between Scotland and Scandinavia

– in the Scottish Parliament on 13th January 2015.

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Photo of John Scott John Scott Conservative

The final item of business is a members’ business debate on motion S4M-11392, in the name of Angus MacDonald, on the need for a direct ferry service between Scotland and Scandinavia. The debate will be concluded without any question being put.

Motion debated,

That the Parliament notes that, following the cessation of the DFDS Harwich to Esbjerg service in September 2014, there is no direct ferry service between the UK and Scandinavia; understands that the historic Newcastle–Stavanger–Bergen service ceased operation in 2008, which meant that there was no direct service between the UK and Norway; believes that a direct service between Scottish and Scandinavian ports would help to increase exports from the Falkirk East constituency and other parts of Scotland to northern Europe while simultaneously attracting tourists with high disposable incomes, and notes the calls for the Scottish Government, the Scotland Office, Scottish Development International and interested regional transport partnerships to work with port and ferry operators to investigate the feasibility of such a project.

Photo of Angus MacDonald Angus MacDonald Scottish National Party

I am pleased to have the opportunity to highlight in the chamber the need for a direct passenger and car ferry link between the United Kingdom and Scandinavia, which has been of concern to me and campaigners for some time. I thank all the members who signed my motion, particularly those on the Opposition benches, as that has enabled me to bring the issue to the chamber.

I am highlighting the issue here today because I feel that we are missing a trick in not attracting tourists with a high disposable income to Scotland and are missing out on a direct transport link for Scottish exports from Central Scotland and beyond.

In recent years, we have seen the demise of historic direct passenger ferry routes between the UK and Scandinavia. In September 2008, the last ferry sailed from Newcastle to Stavanger, Haugesund and Bergen in Norway, breaking a service that had lasted for 130 years.

Last year, DFDS Seaways announced that it had decided to withdraw the service between Harwich and Esbjerg in Denmark, which in effect means that there is now no direct passenger car ferry between the UK and Scandinavia.

There are, of course, small campaigns on both sides of the North Sea calling for the reintroduction of those services. One that seems to be gaining significant traction and support is the international campaign for the ferry to Norway, which has demonstrated that there is considerable demand for the return of a UK to Norway ferry link. It has gathered a significant volume of evidence from campaign supporters and tour operators in the United Kingdom and Norway and throughout the Nordic region.

The ICFN highlights Office for National Statistics reports of a 48 per cent rise in visitors from Norway to the UK. Further analysis of those statistics shows that, in 2013, there were 1.175 million travellers between Norway and the UK. It is said that approximately 8 per cent of that figure would be required to make a UK to Norway ferry route a profitable ferry passenger service.

That is all well and good, but clearly will and investment from the private sector are required to make it happen, as there are, as always, state aid issues that hinder direct financial support from Government.

There is a glimmer of hope that the recently established firm Norwegian Seaways will resurrect the Newcastle to Norway service which, if successful, would reintroduce the historic service and mean that high-spending Norwegians would return to Scotland. The service would give Norwegians the opportunity to visit Scotland’s vibrant cities and our rich and historic countryside, and would allow us to capitalise on good will towards Scotland from our Nordic neighbours.

We should not forget that the citizens of the Nordic countries are statistically some of the most frequent travellers in the world, with nearly 50 per cent of their travels being to a foreign country. The Scandinavian countries also have some of the highest average incomes per capita; Norway is at the forefront, with an average per capita income of more than £42,000. Our tourism industry could do with some of that.

Of course, there are legitimate commercial reasons for the withdrawal of the previous services. The DFDS ferry service from Harwich to Esbjerg was abandoned in part due to high fuel costs, which, as we have seen in recent months, are no longer the issue that they were.

Ship operators are also nervous about the increasing costs from the new sulphur reduction regulations that the International Maritime Organization has set. Ships that pass through an emission control area, including northern European waters, must now cut their sulphur emissions or face fines. The regulations demand that ships cut sulphur content in the fuels that they use to 0.1 per cent, compared with a sulphur content of up to 3.5 per cent that is allowed under the current rules.

The new directives have been set to help to reduce the amount of emissions, and to meet them shipping and ferry services are required to use low-sulphur fuel or to fit their engines with a sulphur filtration system.

I know that fuel producers are already addressing the issue. In my Falkirk East constituency, Ineos, the operator of the Grangemouth refinery, has installed sulphur recovery units at considerable cost, which will go some way towards addressing the issue. As time moves on, therefore, we will see the arguments against the introduction or reintroduction of the ferry routes diminishing.

Given that there are fewer hurdles in the way of commercial operators that wish to start new services, I hope that the Scottish Government, perhaps in partnership with the Scotland Office, Scottish Development International and interested regional transport partnerships, will investigate the feasibility of establishing a new ferry link between Scotland and our neighbours across the North Sea.

We are watching closely to see whether there is any prospect of the Newcastle to Norway service being introduced. If that ferry service were to be resurrected in the near future, there would be no need for a Scottish service.

I am aware that Fergus Ewing, the Minister for Business, Energy and Tourism, has been actively involved in talks with the north east local enterprise partnership in England, and I hope that resurrection of the ferry service to Norway was one of the main items for discussion. Joint working between the Scottish Government and the north east LEP would clearly benefit the economies of both Scotland and the north-east of England.

If the Newcastle service is not to be resurrected, there should be no doubt that a direct link between Scotland and the Scandinavian countries could provide a valuable connection, which would aid an increase in trade and an increase in tourist footfall from Scandinavian citizens with high disposable incomes.

In my view, there are two options that would benefit Scotland directly: first, a Rosyth to Norway/Denmark service; and, secondly—albeit less likely—an Aberdeen to Norway service. Rosyth already has passenger terminal facilities in place, which it uses for visiting cruise ships. I have had informal discussions with Forth Ports officials, who would welcome approaches from interested ferry operators. Clearly, however, that would require significant financial investment from ferry operators and good will from local and national Government on both sides of the North Sea.

Approximately five years ago, Norwegian ferry operator Fjordline considered an Aberdeen to Stavanger/Bergen service. However, I checked recently with the chief executive officer of Fjordline, Ingvald Fardal, who confirmed that the shipping company does not currently have any plans to establish a new route from Stavanger to Aberdeen; its priorities for the next few years are its existing three routes between Norway and Denmark and one route between Norway and Sweden. Encouragingly, though, its evaluation is that there could be a market for a service between the UK and Norway during four to six of the summer months. Mr Fardal cited autumn, winter and early spring as having limited potential, primarily due to increased competition from budget airlines such as Ryanair and Norwegian Air Shuttle. The other Scottish option, from Rosyth to Norway or Denmark, or a triangular route between all three, would be a much more viable option.

We have a small number of options, which, with co-operation, could be a reality. With the recent reduction in the cost of fuel, those options become even more realistic and not just part of a wish list. With the backing of the Scottish Government, Scottish Development International and local transport and enterprise partnerships, we can see the return of that historic link with our Nordic neighbours. I look forward to cross-party consensus on this issue as we get closer to our goal.

Photo of David Stewart David Stewart Labour

I warmly congratulate my former Public Petitions Committee colleague Angus MacDonald on securing the debate. I support the objective of Mr MacDonald’s motion and was pleased to sign up to it just before Christmas. I hope that, in a small way, I contributed to securing the debate tonight.

As members might guess, Mr MacDonald hails from the Western Isles, where ferries are not just a mode of travel but a way of life. When I met the leader of Western Isles Council last month in Stornoway, we spent the majority of our discussion talking about the future of ferry services in Scotland, from the important strategic level to the mundane but important subject of changing the ferry times to ensure that newspapers arrive in Stornoway before lunch time. I am sure that Mr MacDonald would sign up to that.

I, too, have an interest in ferry services. In the previous session of Parliament, I was part of the Transport, Infrastructure and Climate Change Committee, which carried out a major inquiry into ferry services and, in particular, the development of new services. By the by, we held many consultations, including in Shetland and Dunoon. For members who have not read it, I would endorse that report.

I agree with Mr MacDonald that re-establishing direct links between Scotland and Norway would help to support our economy in Scotland. I am particularly interested in the ports around Scotland, many of which have seen an increase in employment and in investment and trade from international shipping operations. Harbours such as Scrabster have invested extremely heavily. In my region, harbours in Inverness, Invergordon and Stornoway, which I visited recently, have all seen major investment. More widely, Aberdeen and Rosyth are excellent ports with great facilities. I am sure that my colleague Lewis Macdonald, who is sitting behind me, will want to endorse at least half of that argument.

Photo of Lewis Macdonald Lewis Macdonald Labour

Does Mr Stewart agree that the plans for expansion of the harbour at Aberdeen create many possibilities for improved traffic across the North Sea to a number of potential destinations?

Photo of David Stewart David Stewart Labour

I am very happy to agree with that, and I am sure that the minister heard Mr Macdonald’s strong endorsement extremely well. A direct link would bring in further investment through increased tourism—which is important—and freight transport. If I have read the agenda correctly, the Infrastructure and Capital Investment Committee, which I will join tomorrow, is considering carrying out an inquiry into freight.

I recommend to Angus MacDonald, if he has not already read it, the book “Who Pays the Ferryman? by Roy Pedersen, an ex-Highland councillor who, I suspect, is nearer to his political perspective than mine but nevertheless has great expertise in the area of ferries. Incidentally, Roy Pedersen claims to be the inventor of the road equivalent tariff. I accept that that is perhaps not the same as discovering penicillin or inventing the radio or radar; nevertheless, RET is something to be looked at and I endorse Roy Pedersen’s expertise, which he developed in his time working for the Highlands and Islands Development Board as a young man.

Having read the book, in the few minutes that I have left, I want to really endorse a couple of principles that we should apply: we have to look at the frequency of the service; if it is a vehicle ferry, which I believe is essential, we have to look at practical issues such as the shortest feasible route; and we have to look at efficient vessel design, which is crucial for the crossing, as that will minimise capital costs and fuel consumption and perhaps avoid some of the problems that we have found with other ferry routes. There were problems with not having the correct ferry for the Gourock to Dunoon route, through Argyll.

In summary, in the few seconds that I have left, we need to look at having the right routes with the right speed, the best example of which is the P&O express catamaran service, which does 40 knots—the fastest in Scotland; we need to look at having the right port facilities; we need to avoid the problems that there have been in Dunoon, where we have not been able to use the linkspan properly, for example; and we need to have the right frequency of services.

I believe that this ferry service is a very positive idea whose time has come and I wish Mr MacDonald well with his future campaign in this area.

Photo of Kenny MacAskill Kenny MacAskill Scottish National Party

I, too, pay tribute to Angus MacDonald for lodging the motion. Such a ferry service is an important concept that has been around for a good few years. As I told him earlier, I remember going to speak at a conference in Kristiansund a decade or so ago, supported by Forth Ports Ltd, when the authority in the Kristiansund area was very keen on the idea.

Despite the fact that there is a great desire for such a service and good reason why it should happen, we should not underestimate the difficulties and the challenges. To be fair to Angus MacDonald, I do not think that he has underestimated them. It is a good idea and we need to work at it and for it.

I concur with what David Stewart said. I have read Roy Pedersen’s book. I know him personally and would recommend the book. It is geared more towards Scotland’s links than international links, but it makes relevant points.

There is good reason why we should have a ferry service. The links between Scotland and Scandinavia are long standing. When we look at a globe, an atlas or a map and see the close proximity, we can see that there is something manifestly wrong with not having a ferry link. Scots travelled over there long before they went down and up the Thames.

I remember that when I was in Kristiansund, I went on a walk from the hotel that I was staying in and noticed that the street that the hotel was situated on was called Ramsaygata. I was told that the street in from the airport was called Dalegata. The major company that we went to see, which was involved in fishing, was called Gordon. Indeed, other Scots names—Greig, for example—abound, due to immigration, which was encouraged by King Haakon back in the post-Jacobite era.

However, just because there are those historic links does not mean that such a ferry service could operate today. We should not underestimate the challenges. Low-cost carriers have come in, which has undermined efforts to have a ferry link. I concur with Angus MacDonald’s comments on that. Although I went to Kristiansund a decade ago, some four years ago, my son went to study for two years at Gothenburg university in Sweden. As the caring father, I thought that I could drive him over, catching the ferry from Newcastle. However, as Angus MacDonald said, I could not get a ferry from Newcastle. I then thought that I would go down to Hull, but I could not get a ferry from there, either. Eventually I learned that, as Angus MacDonald pointed out, the only route was to Esbjerg in Denmark, and I understand from him that that route is now gone. Having crossed the Øresund, I would have had to travel all the way back up through Sweden. There is something manifestly wrong with that.

Aside from an initial trip with my son to deposit his belongings, I appreciate that it was easier to take the Ryanair flight into Gothenburg. That is how people tend to go between Edinburgh and Gothenburg, but not all of them go that way, and the point certainly does not deal with trade. There are huge links between Scotland and Norway, and not simply in relation to the oil sector because the fishing industry is significant, too. I remember that at one stage there were discussions with Forth Ports to consider whether it would be possible to take the Rosyth to Brugge ferry up to Aberdeen, which would have linked in with ferries from Norway.

As I say, I think that there is a desire for such a service. We must recognise that there are challenges that go beyond being in the age of low-cost air travel, despite the challenges that that causes for the environment. Indeed, such challenges are probably a reason why we have to look at alternatives, because we cannot go on with the problems that we are causing our environment. People want low-cost travel, but we have to look elsewhere.

The challenge is significant. It is not simply about one Government; it is probably about two, if not more. As we will no doubt hear from the minister, it is also about interacting with the European Commission. We need to involve not only ferry operators but those who operate the ports, which in Scotland have been privatised in the main. We have to ensure that there is the travel and the trade. The trade can be generated, as can the travel. Many might choose to go by Ryanair, but others will wish to take a more sedentary journey and enjoy the sail, as we see from the growth of cruise liners.

I recognise the difficulties, but such a service is long overdue. I pay tribute to Angus MacDonald for raising the issue and I will support his campaign and any other campaign to try to ensure that we deliver that service.

Photo of Alex Johnstone Alex Johnstone Conservative

I congratulate Angus MacDonald on bringing the matter before Parliament. The motion is of great interest and I support it in principle. I will go into that in slightly greater detail before I finish my remarks.

I thank Kenny MacAskill for reminding us in a light-hearted manner that the crossing of the North Sea by ship has been happening for a good 1,200 years although, back then, the Scandinavians were not always as friendly as they are today. We need to work carefully to restore ferry links if possible. However, there are a number of challenges. As has been mentioned, cheap air travel exists between Scotland and Norway, so there is significant competition on the route.

It must be noted that, although there is no such ferry crossing in the North Sea today, there is a considerable trade in freight charters, not least for the oil and gas industry, in which there is a common interest on both sides.

We have heard mention of vessel design, which brings to mind the fact that vessels are not always designed for the routes on which they are used. The problem with the Rosyth to Zeebrugge route was that, although the route was profitable, the ship that was plying the route was more profitable elsewhere and, as a consequence, the service was lost.

We find ourselves dealing with an extremely difficult set of circumstances. There is a competitive route on which there is currently no ferry service, so whoever decides to take forward such a service would be taking a considerable risk. That is why it is extremely important that the suggestion in the motion is taken seriously. Everyone who has an interest in the matter, whether they are involved in the Government or in local government or have commercial interests, needs to work together. The port authorities in Scotland or the United Kingdom along with those on the other side of the potential route need to understand the demands of any route very clearly before progress is made.

If the route is to be run from here, the Government in Scotland will have to interpret European rules on competition and subsidy to ensure that, where money can be made available to underpin such a service, that is done on a limited scale and in a way that assists any operator to avoid fluctuations in demand and cost. Ultimately, it will also have to find its way past the European regulators, which is not always easy.

There is a great deal to be achieved if we can meet the objectives that are set out in the motion. That will not be easy, but we must do all that we can to improve links between Scotland and northern Europe. At the moment, those who wish to transport freight across the North Sea in smaller quantities have to travel to the south of England and then drive back north again. That is a disaster if our objective is to reduce carbon dioxide emissions. It is also a disaster for those whose objective is to transport goods competitively and sell them in another market.

Such a route is equally important, if not more important, to the economy of the countries on the other side of the North Sea, as it would help them to link into the UK economy. Those who have relied on the easier access into central Europe will fast be realising that the UK is the fastest-growing part of the European economy and that the UK is where the market may expand in future if markets are lost in Germany and other central European nations.

For that reason, this is an opportune moment for us to discuss the possibility of ferry services crossing the North Sea once again. If we all work together and the idea gets a fair wind—no pun intended—we can achieve something. Now is the time to talk about it. Let us get together and have the discussions.

Photo of Cameron Buchanan Cameron Buchanan Conservative

As a frequent traveller to Scandinavia and the continent for many years by car, I used the ferry from Rosyth quite a bit. The problem with that service was its slow speed up the Forth—it took too long, so the freight companies did not use it. Rosyth was a great place, but the ferry was too slow. I also took the ferry from Aberdeen a couple of times and it took rather a long time, too.

I am a great believer in having a ferry service to Scandinavia. Just as Angus MacDonald said, such a service is very important, particularly because we have so many ties to Scandinavia. However, I wonder whether Esbjerg in Denmark would not be a better destination because the crossing is shorter. That is the key. The crossing needs to be shorter and not too extended.

The service from Rosyth was excellent—it had nice luxury ferries—but it did not prove economic. The freight companies did not use it because going up the Forth estuary at 15 knots took just too long. Therefore, I wonder whether we should use Newcastle, where there is a bigger catchment area. Aberdeen would be great, but although people would go up to Aberdeen from Glasgow and Edinburgh, they would not go up from England to take a freight ferry. That is the key.

We need to establish a ferry service if there is a will for such a service. I am very much in favour of it and I hope that we can get it. I fully support Angus MacDonald’s motion.

Photo of Derek Mackay Derek Mackay Scottish National Party

I thank Angus MacDonald for lodging the motion. It is important to recognise the strong cultural and historic ties between Scotland and Scandinavia, as well as the many links that exist through oil and gas, fishing and numerous other industries, along with an increasing number of high-spend tourists visiting our country. Those links result in considerable economic benefits to our economy. That would only be enhanced further by increasing the range of travel options available to tourists and businesses.

As members will know, the Scottish Government has been actively exploring ways of increasing the number of tourists coming to Scotland. That has been seen with the huge success in increasing the number of direct flight routes from Norway to Scotland from six in 2009 to 18 in 2015. Other members have picked up on that challenge and opportunity.

The Scottish Government certainly wants direct ferry connections from Scotland to Scandinavia to be expanded. That could bring a different type of tourist from those who already travel by air. We have a productive relationship with European ferry operators and we continue to explore all possibilities.

We have been approached on occasion by parties who are exploring the potential for a Norway service calling at a Scottish port. We have welcomed discussions and engaged with them enthusiastically, offering all the support that we can within the confines of state aid regulations, which members have mentioned. They have yet to overcome the challenges that are involved in putting in place a viable service, but we will continue to work with any potential operator that makes such a proposal. I am sure that members are aware that any such service would have to operate on a commercially viable basis. That would be a matter for any prospective ferry operator to consider fully.

It is important to recognise the enormous contribution that the maritime sector makes to our economy. Any additional ferry routes from Scotland to Europe would only increase the economic benefits throughout Scotland and provide considerable economic and environmental advantages.

One area of the maritime sector that continues to succeed is the cruise industry. Scotland is the UK market leader for inbound cruise tourism, with almost 400,000 people visiting our ports and injecting £41 million into the Scottish economy. Passenger numbers for this year’s calls are forecast to be up on last year’s.

In line with our team Scotland efforts to support air route development to Scotland, VisitScotland supports the development of inbound visitors to Scotland via ferry. That has included carrying out collaborative partnership marketing campaigns with Superfast Ferries and Norfolkline on their direct routes into Scotland, and it continues with partners including DFDS Seaways on the north of England routes, where there are considerable opportunities to grow the proportion of passengers who turn right on disembarking.

In 2013 there were 105,000 visitors from Norway to Scotland, spending £87 million, which makes Norway Scotland’s sixth-largest international market. That has increased from 75,000 visitors from Norway in 2010.

Scotland is well connected to Norway by air, with direct flights available via Aberdeen, Edinburgh, Glasgow and Sumburgh, so the challenge for ferry operators would be to compete with that mode of transport.

We will continue to work in a team Scotland approach with regard to the potential for new services. That will include a range of marketing and tourism campaigns, focused on intelligent trade support.

Scottish Enterprise can help to evaluate the potential freight market and might also be able to offer joint funding support around marketing that element. The Scottish Government has explored options for other forms of commercial support that we might be able to offer potential operators as part of their overall business plan. That highlights some of the ways in which we can assist ferry operators and encourage more tourists to choose Scotland as their holiday destination.

Of course, there are some parallels here with the experience around the Rosyth to Zeebrugge ferry service. The challenges that were faced by that route over time are similar to those that would be faced by any potential new ferry operator. Despite the recent drop in wholesale oil and gas prices, which David Stewart mentioned, marine oil prices have become more expensive due to the introduction of the European Union directive on sulphur in marine fuels.

Regarding any possible Scottish Government funding, we have to be clear that, although it would be beneficial to our economy, a Norway service could not be considered a lifeline route, such as those to the Western Isles and the northern isles, so our options to provide funding support are more limited.

EU state aid rules limit possible funding to the freight facilities grant and waterborne freight grant schemes. Grant awards under those schemes are dependent on the transfer of freight from road to water, which is unlikely to be significant on a Scotland to Scandinavia route. Any new passenger service would also require freight custom to be commercially viable. It should also be noted that there are currently freight services operating between Aberdeen and Norway, albeit not for passengers.

As Alex Johnstone mentioned, a further challenge for operators of passenger ferry services is the availability of suitably configured vessels in terms of cabin spaces, passenger facilities and fuel efficiency.

Photo of David Stewart David Stewart Labour

The minister knows that I raised the issue of vessel design as a crucial factor in how viable the proposal is. The difference between P&O’s 40-knot catamaran, which I mentioned, and some of the slower vessels that other members have mentioned is crucial. Speed makes all the difference. Where there have been failures across Scotland, they have been in situations in which an ad hoc vessel was used, rather than a bespoke vessel for that particular route.

Photo of Derek Mackay Derek Mackay Scottish National Party

There are a number of issues within that point, and the Scottish Government will continue to be supportive in that regard. I was about to talk about how creative Government can be with regard to finding the right vessel and providing support, as has been the case with DFDS. The Scottish Government will do everything that we can to help ferry operators overcome challenges.

I am short of time, so I will simply say that, despite the challenges, we will continue to encourage ferry operators to keep under review the option of introducing a passenger ferry service from Scotland. The Scottish Government stands ready to work closely with any ferry operator that is looking to set up a new route linking Scotland directly to Europe.

Meeting closed at 17:39.