A DECISION on which operator will run a “Jersey-only” ferry service from late March will be made within the next 16 days, the Economic Development Minister has pledged.
Deputy Kirsten Morel confirmed to the States Assembly yesterday that ministers had decided to embark on a new “short and simple” process to confirm the new service for the Island.
This follows the breakdown of collaborative work between Jersey and Guernsey’s government’s to select a joint Channel Islands’ provider – Guernsey pulled out of the joint process and announced on 30 October that it would plough ahead with its preferred bidder, Brittany Ferries, the parent company of current operator Condor Ferries.
During a statement from the minister and 30 minutes’ questioning from States Members, Deputy Morel provided additional detail about the process, including the scale of financial problems he said faced Condor, whose contract runs until the final week of March.
Condor made two requests for financial support to Jersey’s government last year, Deputy Morel said, firstly for 80 million euros, and subsequently for 40 million, including 10 million “needed urgently”.
The company’s bail-out request prompted a joint Jersey/Guernsey decision to put contingency arrangements in place, at a cost of £3m to each island, he added, with levels of concern rising further on receipt of a letter in September of this year.
Deputy Morel told Members: “I received notice from the chair of the board of Condor on 11 September, stating that in the event Condor was unsuccessful in securing the future operating agreement, it could not guarantee to be able to continue trading for the remainder of the operating agreement.
“The letter made it clear that Condor would likely require funding from the Government of Jersey of up to £36m in order to see out its contractual obligations.”
Other factors mentioned by Deputy Morel included:
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Some of the loans taken out by Condor being liable to “eye-watering” interest rates.
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The possibility that Condor might go into administration, with its vessels also being within the administration process.
Turning to the rival bid for the joint contract from Danish shipping giant DFDS, Deputy Morel said that “by any common sense meaning of the two bids, [DFDS] is clearly the better of the two”, but he added that a “technical legal point” had caused the bid to be “eliminated”.
The Economic Development Minister did not elaborate on the legal issue around DFDS, but added that he was confident this was an area that could be overcome during discussions over the new Jersey-only contract set to take place next week.
Recent assertions by the president of Guernsey’s Economic Development Committee, Neil Inder, about DFDS not having a fleet of ships available were refuted by Deputy Morel.
He said the Danish firm had named a fleet which was not based on using Condor vessels, made up of some DFDS-owned boats and others which would be chartered.
“From my perspective, I have never had any concern about the ability of DFDS to create that fleet, not using Condor’s [fleet]”, he said.
Meetings will be held with “both companies” next week.
In a statement issued at 4pm yesterday, Chef Minister Lyndon Farnham said he wished to reassure Islanders that a decision on “lifeline ferry services” was “our top priority”.
Deputy Farnham confirmed that next week’s meetings would involve government representatives talking to both Brittany Ferries and DFDS, with an announcement to be made in the week commencing 25 November, and the expectation that a timetable for summer services would be issued as soon as possible after that. This would be similar to previous years, when summer timetables had been issued in December, he added.
Independent evaluators will assess the rival bids, with officers providing a preferred bidder recommendation.
Deputy Morel said he would then seek the Council of Ministers’ support for the recommendation, before announcing the winner before the end of this month.
The minister said he was “confident” that the end-of-month target for a decision was realistic, and that the proposed Jersey-only service was “viable”.
Scrutiny of the new contract process was welcome, Deputy Morel added, and he pledged to organise a private briefing for States Members, thanking those who had offered support in recent weeks.
