BC Politics

Ferries Fare Cuts Coming Without Plan to Replace Lost Revenue

New government funding falls short of costs of changes promised in NDP campaign.

By Andrew MacLeod 5 Mar 2018 |

Andrew MacLeod is The Tyee's Legislative Bureau Chief in Victoria. Find him on Twitter or reach him here.

The British Columbia government will provide more money to BC Ferries, but not enough to cover the full cost of the fare reductions it has ordered.

The NDP government is following through April 1 on campaign promises to freeze rates on the major routes between the Lower Mainland and Vancouver Island, cut fares by 15 per cent on the minor and northern routes and reinstate free passenger tickets for seniors from Monday to Thursday.

When BC Ferries released its third quarter results in late February, BC Ferries president and CEO Mark Collins said the corporation would cover some of the cost of the government’s initiatives.

“With increased traffic, BC Ferries has had two strong years financially and the company is pleased to contribute to government’s fare initiatives,” Collins said.

A spokesperson for BC Ferries said via email that it wasn’t clear yet how much the corporation’s share would be. He didn’t respond to a question about the total cost of the measures.

“Essentially, we are still in negotiations with the province over how much BC Ferries will contribute to ensuring these fare initiatives are carried out,” he said.

Transportation and Infrastructure Minister Claire Trevena said the government is contributing $27 million towards the cost of the policies and discussing how to cover the total cost with BC Ferries.

The government has to balance BC Ferries’ financial ability to provide transportation with the need for greater affordability, Trevena said.

“This is a priority for us,” she said. “Reducing fares, the affordability issue, it’s going to be a priority for us, so we’ve worked quite closely with BC Ferries over the past few months to get to this position and we are really happy that we are there.”

Under the BC Liberals, the government restructured BC Ferries in 2003, changing it from a Crown corporation to a publicly owned private company. The intention was to move towards having users pay a greater share of costs, which resulted in rapidly rising fares, and to give the corporation more independence from the government.

BC Liberal transportation and infrastructure critic Jordan Sturdy said BC Ferries contributing to the government’s promised fare reductions shows a new direction.

“It certainly suggests there’s an undue influence or an interference with the operations of the corporation that hasn’t been there necessarily in the past, or the last number of years.”

The government is putting BC Ferries in a position where it will have a revenue shortfall, Sturdy said. “It puts BC Ferries in a very difficult situation,” he said. “They have limited revenue opportunities. It’s fares, it’s hamburgers or it’s transfer from government.” The corporation could also reduce services or delay its capital spending, he said.

Adam Olsen, BC Green MLA for Saanich North and the Islands, said a more comprehensive approach to improving ferry travel is needed, including bringing BC Ferries back into the government.

“The measures that are being proposed here are half measures,” Olsen said. “When we say that we’d like to see it come back into government, we haven’t determined whether or not that would be better in the Ministry of Transport or as a Crown corporation, but clearly the hybrid model that’s worked now, there’s questions as to its effectiveness.”

The increasing cost of ferry fares has been challenging for island communities and a drag on the province’s economy, he said.

The government is reviewing BC Ferries, but has already said the review will focus on operations and won’t consider bringing the corporation back into the government, something the NDP advocated in opposition.

“I think there’s a lack of clarity on what the plan is from this government,” Olsen said. “They were clear in opposition what should happen with the former government. We need that same sort of clarity now that they’re the government.”  [Tyee]

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