Skye Bridge tolls to go in 2004
Labour, Liberal and Scottish Nationalist politicians are claiming credit, and softheaded campaigners rejoicing.
Wilder toll opponents like Robbie the Pict, are even insisting that the money already collected should be returned to the people of Skye, and that past convictions for non-payment be quashed.
Scotlandís taxpayers, environmentalists and the residents of Skye may be less happy.
Until 1995 Skye was connected to the mainland by a crowded roll-on roll-off ferry, which never kept up with the cars waiting to cross from Kyle of Lochalsh. 300,000 cars per year were crossing and in summer queues of a couple of hours were common[i].
For years, people had been suggesting that a bridge be built. In the 1950ís the plan had been for a low level bridge with an opening central span, in 1969 a suspension bridge, and later still a tunnel. All were judged too expensive by the governments of the day, and without the right to recoup their investment via tolls, no private company would build a bridge. So the queues continued.
At last in 1989 the then Conservative government launched the Skye bridge design competition which was won by a joint Scottish German consortium, Miller-Dywidag.
The government then put the building contract out to competition as part of the then new private finance initiative (PFI). After prolonged negotiation, this was won by a consortium of banks who created the Skye Bridge Company. The deal was that the company would build the bridge and reclaim their costs through tolls, but that tolls should remain below the fares of the old ferry and that after a period of time the bridge should revert to government ownership and the tolls cease. The agreed formula was for tolls to run between 15 and 27 years depending on revenue.
The eventual cost of construction was £39 million, of which the government paid £12 million and the company and its investors put up £27 million in 1995 money. For that investment they got an income of about £4 million per year in todayís money.
Many have criticised this as excessive. It is not. Not only does the company have to maintain the bridge, but when they entered the contract they faced considerable risk.
The whole point of PFI was to transfer risk from the taxpayer to the company. The idea was that the company stood to gain if it got the job done on time and under budget, but make a loss if it overran. If the job had been left to government we all know that it would have been delayed and costs would have overrun many times.
Building the bridge was a considerable achievement. The builders faced technological challenges, and protests from environmentalists, who insisted on expensive refinements such as otter-proof road walls and otter tunnels. All were delivered and most people now regard the bridge as environmentally successful. It is certainly beautiful. Here is a picture.
More importantly the company won the contract in competition. It is easy to claim now that profits are excessive. The issue is whether any one else faced with the technological and political uncertainties of 1995 would have been willing to do it for less. It was open to anyone to come in with a lower offer, but no-one did, not even Robbie the Pict and his friends. He would have done his fellow islanders a real favour if he had.
Nor can the tolls be regarded as a real hardship. £5.70 each way per car for the tourists but effectively £1.30 per car for the islanders with discount tickets. The full rates are shown below. Large discounts are also offered to regular users. The tolls were originally set at the same level as the ferry fares, and then frozen in 1999, so they are now much less than the ferry fares would have been. Since the bridge provides a vastly better service than the ferry, which ran only during the daytime, it is difficult to see what upset the islanders.
Nevertheless, the locals have been banging on from the very start of the project. A group called SKAT, Skye & Kyle Against Tolls has been collecting petitions, supporting non-paying protestors and generally winding up politicians, and making money for lawyers and trouble for the bridge company.
They argue that the Skye Bridge Company, protected from competition because there are no ferries, and having received an unfair one-off subsidy of £12 million from the taxpayer, is now overcharging to cross the bridge.
This is odd because there is still a ferry to Skye, running the Mallaig-Armadale route from the mainland to the south of Skye. It charges cars £16.90 each way plus an extra £3.05 per passenger. It only runs in summer, vehicles have to arrive at least 30 minutes before departure, and the latest crossing is 5pm. Caledonian MacBrayne run it, and their latest accounts make interesting reading. They are a wholly owned government company. This means that not only do they not pay tax, but they also get a £20 million subsidy every year from the Scottish executive.
It looks like SKAT don't mind tourists paying through the nose for a crappy government service, but object to paying anything to a private company.
A Scottish lawyer, Professor Mark Poustie, of Strathclyde University, has argued that since the cumulated tolls at that time in 2003 money (£27.25 million) was more than the construction cost of £23.64 million at 1990 prices (his figures), the bridge had already been paid off, and charging further tolls was illegal.
You can see why Scotland is in such a mess if thatís the sort of argument their academic lawyers come up with. I wonder what the professor's building society said when he stopped repaying his mortgage, because the face value of his repayments had reached the sum borrowed! Imagine what David Hume or Adam Smith would have to say to Poustie. I'd love to be there to hear it.
The toll regime was expected to end anyway fairly soon, probably between 2009 and 2013, because toll income was higher than expected. Unfortunately the news today suggests that was not enough for the populists in the Scottish parliament.
If Jim Wallace, and Robbie the Pict have their way politicians will take money from taxpayers to buy out the company and allow Paul McCartney and thousands of other English tourists to travel free over the bridge. Some industry will move the Skye in response and the local economy will be boosted a little at the cost of a little economic depression elsewhere. Overall Scotland will be just a bit poorer, and traffic and pollution a bit higher. A sad day.
June 6th 2004
June 6th 2004
the record, here are the current Skye bridge tolls.
May to 30 September:
Motorcycle £2.90; Car £5.70; LGV £10.80; HGV £14.00-£27.90.
1 October to 30 April:
£2.40; Car £4.70; LGV £10.80; HGV £14.00-£27.90.
Click here for the Skye bridge company website
here for the toll
The ferry operator was Caledonian
MacBrayne, a Government owned company, so we should not have been surprised
that they were hardly up to the job. However, we should not
be too hard on them. The
Scots have always been ambivalent about modernity.
In the 1960s, with queues at their height, ministers of the local
Kirk staged a sit down on the jetty to protest at the first Sunday crossing.
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