It’s a very short time since the revelation that the Scottish Government was about to award the contract for the Northern Isles ferry services to Orkney and Shetland to a competitor of NorthLink Ferries, a state owned operator, a subsidiary of David MacBrayne Limited.
Serco – according to The Guardian, ‘the biggest company you’ve never heard of’, had been made preferred bidder. (For Argyll’s response to this rather strange situation is here: Northern Isles ferry contract sends signals to west coast.)
Serco has very little ferry operating experience but is a major public sector contractor across a wide range of services, including marine support to the Royal Navy.
Earlier today it became known that a third bidder, Streamline Shipping, headquartered in Aberdeen, had lobbed a curve ball into the mix by issuing a legal challenge to the Scottish Government decision, arguing that it had a more powerful case for taking over the service.
In one move, this laid bare the vulnerable position of the ferry operators in the publicly owned MacBrayne group.
By dint of that very relationship, NorthLink is a pawn in someone else’s game. It is not in a position to issue an independent challenge to the Government as Streamline has done. Nor, in similar circumstances, would CalMac be able to do so.
Our analysis of what the Scottish Government is doing in this matter is contained in our earlier article linked above. We feel that it has clear implications for the future of the west coast ferry services.
Streamline is a capable freight shipping company with no background in passenger and vehicular ferry services; but, in its freight moving role, it is already part of the network of lifeline services to the Northern Isles.
So far, while being open about the fact that it has issued this challenge, Streamline is saying nothing about the specific case it feels it has.
Presumably if Streamline’s legal move succeeds, it must reopen the tender process.
Streamline can have no knowledge of the detail of the Serco bid, nor that of any other bidder. A legal challenge could not therefore reopen the tender selectively, allowing only Streamline back into the reckoning.
This will be interesting to watch.
We felt that the Government strategy on the decision it took was pretty readable. NorthLink could do nothing about it but Streamline is free to object and has clearly found a legal basis for so doing.
If the tender is reopened, will NorthLink return to the table?
Either way, how the Scottish Government resolves this situation will be indicative of its intent.
Streamline innovation and collaboration with CalMac
Streamline seem to be an innovative outfit.
To improve customer service and efficiency they suggested trialling the latest IP broadband technology using satellite communication to enable Chip and PIN terminals to work anywhere the satellite signal can be received – even in remote seas.
Just over 18 months ago, one of CalMac’s 29 ferries , MV Lord of the Isles, was fitted with Streamline’s leading-edge broadband-connected card-payment terminals. These are the fastest such terminals available to date – and make use of the client-server authentication technology that obstructs attempts to defraud. This trial was successful CalMac is said to be planning to introduce the technology on other of its ferries.
There should be no reason on earth why any of the bidders for the contract should be prevented from challenging the outcome of the tendering process, if they consider themselves hard done by.
The specific offers for ‘extras’, and of any conditions imposed by bidders – beyond what’s specified in the tender – should be public knowledge, and if they’re not then surely that’s cause enough for any or all of the losing bidders to challenge the outcome; the whole process should be transparent, and that popular let-out ‘commercial confidentiality’ shouldn’t be used as an excuse to conceal any controversial aspects of the process.
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The MacBrayne group would certainly face some difficulty in challenging any contract award, and have been in such a position before on the Ballycastle-Rathlin route. One has to wonder why the Scottish government took such an “interest” in the way that particular contract was awarded.
” Judith Ainsley, Guy Platten of CMAL and Mike Berry (Scottish Government Ferries Division) are hoping to meet with representatives of DRD (Department for Regional Development) Northern Ireland to discuss the tendering of the Rathlin-Ballycastle ferry service, this will be followed by a visit to the ferry operator”
http://www.scotland.gov.uk/Resource/Doc/935/0087905.doc
Perhaps Streamline have done MacBrayne a favour in opening the process up to legal scrutiny.
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I don’t understand why ‘the MacBrayne group would certainly face some difficulty in challenging any contract award’ – Why? Surely the tendering process has by law to be a level playing field, and if Northlink (which is surely more than just MacBrayne) were to find fault with the contract award they’d be just as free as any other tenderer to object. This is a government tender involving public money and must be organised fairly, or the media will have a field day and the Transport Minister will have some explaining to do. That’s quite apart from what the European authorities might see fit to do.
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I think you will find streamline credit card machines has nothing to do with streamline shipping!
Come on, poor research
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This would make more sense – over energetic research on our part?
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Hmm, don’t you mean “no research on our part”, but instead a classic case of jumping to a false conclusion?
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NORTHERN ISLES FERRY TENDER
Back
13 May 2012
“NorthLink Ferries Ltd today confirms that it is in continuing discussions with the Scottish Government to clarify certain aspects of the procurement process which eight days ago saw Scottish Ministers announce that the six-year contract to operate lifeline ferry services for Orkney and Shetland was to be awarded to Serco Ltd. NorthLink’s current contract to operate the services is due to expire on July 5″ http://www.northlinkferries.co.uk/default.aspx.locid-00gnew3eu.Lang-EN.htm
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Many thanks for this update.
Good to see signs of independence.
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Independence? Hardly independence, as NorthLink is a wholly owned subsidiary of the Macbrayne Group (i.e. the Scottish Government) and who are they currently running the service for? Oh yes, the Scottish Government! Perhaps not so much independence as nepotism?
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“they’d be just as free as any other tenderer to object. This is a government tender involving public money and must be organised fairly, or the media will have a field day and the Transport Minister will have some explaining to do.”
Do you think? Having read their responses to an “independent” investigation into the awarding of the Rathlin contract, it’s very clear that Calmac/Rathlin Ferries Ltd were unhappy at the way in which that tendering process had been operated. Yet, no legal challenge? http://www.scribd.com/doc/9618691/CalmacRFL-Addendum-Note-to-DRD-investigations-body
http://www.scribd.com/doc/9592687/CalmacRFL-Note-to-the-DRD-investigations-body
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I hope we’re not getting into some sort of Scottish public sector giant pile of sleaze centred on inadequately defined process in tendering for large public transport contracts. It could be stretching from the megabungling of the Edinburgh tram system procurument disaster at one end of the scale to the microbungling of the Gourock – Kilcreggan – Helensburgh ferry links at the other, taking in the Gourock – Dunoon affair and the ongoing saga of Calmac routes retendering on the way. Not sure about the quality of the second Forth Road Bridge contract, but time will tell.
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I stay on Orkney and we are just sick of the mess the Government is making of our lifeline ferry service. The contract with Serco, if it lasts, is undesirable -they can only make money by cutting services and the crew’s pay and numbers and their reputation as a cutter of pay and numbers is clear from their control of NHS contracts in England. As well as the developing contract fiasco, this year we had the mess the Government made of the dry dock timetable where they went behind Orkney’s back to get Shetland council to pay extra for an extended charter of the Hebridean Isles (I think); we’ve the attempt to cut service standards by slowing down the boats and reducing services; there is the continuing saga of the alternating denial and promise of RET which, if it comes has receded to the next Parliament.
This is heading for a grand all purpose mess.
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Are you sure you’re not over-egging the pudding? With two separate Northlink services (Stromness – Scrabster and Kirkwall – Aberdeen / Lerwick, the Pentland Ferries route from St Margaret’s Hope to Gills Bay, and the freight ferry between Kirkwall and Aberdeen / Lerwick, to the outside observer it looks as if Orkney enjoys good lifeline ferry services.
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I agree that we do well with the service we get – the service from the Hope to Gills Bay is completely private with no subsidy nor does it count as a life line service. Our bind is not so much about the service as the secretive and underhanded behaviour of the Government – for example we don’t know about what the new contract says about ferry frequencies or times; there looks to be a cut back in the freight boats for both sets of islands; the possibility of RET for Orkney ferries- including the internal services has receded to beyond 2015.
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Of course they enjoy good services, just like Dunoon has a reliable service. Unless you are local to the route and use it regularly you really don’t know all the ins and outs.
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Transport Scotland do not seem particularly competent at writing contracts – read yours carefully.
In theory CalMac can take legal action, it practice I imagine it not possible because CalMac is run by the Scottish Government so people are hardly likely to try to take Court action against a decision made by their own bosses.
There was no logic to the Dunoon Gourock route decision. A linkspan had been built a promise of vehicle ferries had been made, then all of a sudden there was a U-turn. Now with the CalMac losing Northlink it is starting to look as if there is an agenda to break up CalMac.
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i think the snp agenda is get rid of calmac ,alex salmond stated yesterday the basf factory in stornoways would create 9 jobs (equal to thousands in the glasgow/edinburgh). when they give northlink and calmac away ,i fear hundreds of jobs will be lost (mostly in rural areas ).
how will he explain that !!!!
this isnt scaremongering it will happen .
snp …only interested in big business ….get these clowns out
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It does look like they want to break up CalMac, but why is not clear. Private companies will snap up the profitable routes. The Government will be left subsidising the unprofitable routes. Everybody will lose because there will be no ability to move relief boats around during maintenance periods.
This is exactly the position in Dunoon. The vehicle part of the old CalMac service was making a profit every year from 2002 until it ended in 2011. Now the Government has to subsidise a dismal passenger service that cannot cope with the weather and has to run a half service for four weeks each year because there are no relief boats. Meanwhile Western gain 60,000 vehicle crossings per year with no control on prices and profit.
This seems set to spread throughout the ferry routes in Scotland – not good news.
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Follow the money people
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