Serco NorthLink named as preferred bidder for Northern Isles ferry services

Serco NorthLink has been named as the preferred bidder to continue Northern Isles ferry services.

Making the £345m contract announcement, Islands Minister Paul Wheelhouse said islanders will get a 20% discount on cabin fares on Aberdeen-Kirkwall-Lerwick routes from January.

There will also be a three-year fares freeze for islander passengers, non-commercial vehicles and cabins on those routes.

Serco won a six-year contract in 2012.

Mr Wheelhouse said: "The Scottish government remains fully committed to high quality ferry links to the Northern Isles so I am delighted to announce Serco NorthLink as the preferred bidder to operate these services for a further eight years."

There will be a standstill period before the contract is formally signed and awarded.

Serco Group chief executive Rupert Soames said: "We are very proud of our track record over the past seven years, during which time we have improved almost every aspect of the lifeline service for the communities and businesses of the Northern Isles.

"We look forward to further improving the service in the coming years."

However, RMT general secretary Mick Cash described it as a "retrograde step".