The Island’s ferry services are under the microscope.

Isle of Wight Council leader, Phil Jordan, has announced the formation of a dedicated ferry working group, comprised of locally-based industry professionals. The move aims to examine potential measures to protect the Island’s interests, following the government’s dismissal of concerns raised over the cross-Solent ferry market.

Despite a plea to the Transport Secretary concerning Red Funnel’s repeated service cancellations, the response from Lord Davies of Gower, the Maritime Minister, on March 7 was to side with the ferry operators. He said that Red Funnel had promised service improvements and argued that the ferry market operates efficiently without needing any government intervention, citing competitive services provided by multiple operators.

However, recent developments, including a mass directors’ resignation at Red Funnel, and a weekend of chaos and disruption caused by technical failures, have cast shadows over Red Funnel’s operations. Cllr Jordan highlighted the Island’s vulnerability to the decisions of overseas financial investors owning the ferry companies, and voiced frustration over the government’s refusal to step in when the IW Council has no powers to act. He said: “The government has indicated on a number of occasions they will do nothing.

“I am writing to the Secretary of State to tell him that we need intervention without further delay. We need some regulatory measures, and we need the complex financial ownership arrangements investigated. To help with this I am putting together a group of locally-based industry professionals to assist in examining all of the issues. We are considering the make-up of that group, but will not leave any stone unturned in getting the very best people to help support the struggle to improve our lifeline services.”

Cllr Jordan confirmed the possibility of involving the Competition & Market Authority (CMA) if recommended by the working group, noting that it’s been 15 years since the market was last reviewed. The CMA has the teeth to demand information from the companies, rule on remedies including regulation, and issue penalties.

Meanwhile, MP Bob Seely has also issued a report on the ferry market. He said: “My research has led me to believe that, using a web of offshore companies, Wightlink and Red Funnel’s owners and lenders have taken large profits out of the firms for years.”

His proposals include an independent regulator, mostly working through voluntary agreements, Department for Transport oversight, price caps on health journeys, and voluntary regulation. He is asking for feedback on his report over the next two months, after which he intends to “re-engage with ministers, officials and the ferry firms.”

In 2017 during a hustings meeting, Mr Seely pledged to “set up an IW Bill which will re-regulate the ferries.” The IW Observer asked him earlier this week what had become of his pledge, and whether he would be prepared to support a referral to the CMA. He has not responded to either question.

You can read Mr Seely’s 21 page report at iw.observer/seelyreport.

Disappearing directors

Throughout last weekend’s chaos and confusion, Red Funnel directors remained mysteriously absent. Despite mayhem at its terminals, and mounting frustrations among passengers, not a single director from either the ferry operator or its parent company made an appearance to support their hard-pressed staff dealing with hundreds of angry passengers. Even on Monday, the only director present in Bugle Street was HR Director, Debbie Reed.

Investigations reveal that key company figures are far-flung, including operations director, Leanna Lakes, based in Kirkcaldy in Scotland, Erik Ostergaard in Denmark, and Stephen Ridgway, who splits his time between London and Sussex.

Red Funnel refused to comment on how an operations director based more than 500 miles away can be effective, and offered no explanation why other directors were not present during the crisis. The company also refused to say where other directors live, leaving questions hanging in the air about leadership during times of emergency.

Red Funnel’s current owners are the Workplace Safety & Insurance Board, based in Canada, West Midlands Pension Fund, and (uncovered after determined investigation) BAE Systems Pension Fund. None have made any public comment about last weekend’s ferry fiasco.