Unused ferry capacity should be targeted, MHK says

The Sea Services Agreement was introduced in early 2020

Capitalising on the Isle of Man Steam Packet Company’s unused passenger and freight capacity could see "significant benefits" to the economy, the enterprise minister has said.

Giving evidence to a Tynwald committee set up to review the Sea Services Agreement (SSA), Tim Johnston MHK said schedules were relatively "under-utilised" with an average yield of 40% across a year.

He said if the ferry firm changed its "purely profit" approach to focus on "better better utilisation of freight space and increasing customers, the island and the company could both benefit".

Committee members also heard a review of the company's pricing structure could provide boost the visitor economy.

Drawn up in 2020 and due for its five-yearly review next year, the 25-year SSA includes conditions on fares, routes and the frequency of sailings.

Visit Isle of Man chief executive Deborah Heather said people expected "flexibility" and a current five-day discount fare could be "blocking that a little" as passengers prefer to choose the number of days they like to stay.

The head of the island's tourism body also said keeping track of seats that did not routinely sell could "better inform" the company's pricing strategy.

On working with the travel trade, which uses a notice period of 18 months, Ms Heather said longer term bookings could be secured if the Steam Packet worked to a similar schedule.

Instead she said it sometimes felt like "a lottery" when making reservations with the firm.

'Critical service'

During the evidence session, Mr Johnston said the enterprise department felt "more emphasis should be placed on the social and economic outcomes the island could leverage from this critical service".

"Massively increasing" the firm's capacity through creative initiatives could see "significant benefits" to residents, visitors and import and export sectors, he said.

For example, the minister said providing more affordable freight fares for the "struggling" agriculture industry could provide a "life line" to "reinvigorate" the sector, which might in turn need more imports.

But the approach had to be "set against" the fact that the government-owned ferry firm had to invest in its future by making profits, he added.

The Steam Packet is a Manx government-owned company, which is run at arm's length by a board of directors.

The committee previous heard evidence from representatives of the ferry firm and the treasury.