The real costs of the Bridge to Skye - Comment on the Audit Commission Report

Read the Public Accounts Committee Report on the Skye Bridge!

Throughout its long campaign against the injustice of the Skye Bridge Toll regime SKAT has been sustained by the massive support it has had particularly from the press. Most of us were aware that the PFI was unjust but until the Audit Commission report we lacked real evidence to back up our claim. In its polite Civil Service way the report is a damming condemnation of dogma pursued at the expense of common sense. The analysis by the press has been excellent, many of the issues we raise have already been covered, but it is worth stressing again the main conclusions that can be drawn from it:

It is significant that primary objective of the Scottish Office was the early delivery of a privately tolled crossing. The political commitment to the use of PFI was such that the use of public funding was not even costed.

The report finally lays to rest the lie put out by the Scottish Office that Skye could not have had a publicly funded bridge for at least 20 years. The report gives the construction costs as 20 million, public funds amounting to 14.6 million were put into the PFI, leaving a balance of 5.4 million required for a toll free bridge. The ferry generated a profit of 1 million per annum, had it been allowed to run and the surplus kept, a toll free bridge would have been possible within six years. Had Objective One funding (which was in place shortly after the contract was awarded) been applied for then the cost to the public purse of a free bridge would have been 4.6 million less than the PFI.

Having decided for purely dogmatic reasons to use PFI, the government did not even achieve the basic minimum criteria for its application. It had to assist the developers to obtain funding from the European Investment Bank when they could not obtain it from the private sector. It achieved no significant transfer of risk , in fact the return to the developers for their minimal investment of 500,000 will be of the order 10 million. The Scottish Office has already paid out some 2 million in compensation for delays and is facing a further pay out to the developers of 5 million. There was after the very early stages no significant competitive element in the contract. So determined were the Scottish Office to push this project through that they did not even carry out a formal risk analysis. They went into a major contract unaware of what the potential costs to the public purse would be.

The report clearly states that mistakes were made in this project but excuses them by saying that it was the first. This is no consolation to the people of Skye who face paying the highest toll in Europe until well into the next millennium. The consultants engaged by the Scottish office were paid huge sums of money, we would ask, for what - given the mess that the project was and is. These consultants were appointed on what appears to be the "old boy" system and have manifestly failed to produce the goods.

The District Valuer put a value on the land required of 300,000 yet the final pay out to ????? was 784,000. This is a significant extra amount in terms of the overall project cost. SKAT think that it is in the public interest to know why compulsory purchase was not used and who got the extra 484,000.

The report, damming as it is, does not cost the full implications to the public purse of this project. The costs of enforcing the toll regime have run into millions and continue to mount with each trial in the Dingwall court. At the current rate of progress, to clear the existing trials will require at least two more years. SKAT will not go away unless something is done to correct this massive injustice. The consultants report on the costs to the local economy also have a bearing on the public purse - what cost the loss of 250 jobs ?

High as the cost of the tolls are now, the report details the frightening prospect that they could increase in real terms by 30% over and above inflation. This would put the toll up to just short of 7.00 each way for a car. If revenue falls, this can be activated from this year. All of us are now painfully aware that traffic numbers are way down after the post opening boom. A further worry is the persistent rumour that the company intends to dispense with concessionary tickets because they are being extensively sold to non local traffic. It is interesting in the context of the above to read the recently published accounts for Skye Bridge Ltd for their first full year of trading It is horrifying to note that the cost of collecting the toll was 1,830,725.00 in total, just how much do these toll collectors get paid ? Put simply this means that 57.5% or 3.00 of the 5.20 toll goes to collect it.

In opposition Labour promised action when they had seen the audit commission report and had access to the contracts. In the light of the above that action must be sooner rather than later, enough is enough, we need a commitment from the Scottish Office to remove the blight of this Tory folly completely. The Tolls should be removed now and prosecution of protesters abandoned, Skye must not be made to pay for the mistakes of civil servants and Tory dogma.

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Copyright Ray Shields, 1997.

Most recent revision, 15 June 1997.