BCF cancels $4.9 million in service cuts to major routes

Derek Kilbourn

Sounder News

Tuesday, May 19 2015

BC Ferries will not be looking to find $4.9 million in savings from the major routes, as was announced in late 2013 when the cutbacks to the minor routes schedules were made.

Heather Nicholas, Islands Trustee for Gabriola, sits on the Gabriola Ferry Advisory Committee (FAC) and was quizzing BCF staff about rumours Trust Council had heard that there would not be $4.9 million in service cuts made to the major routes.

She was also asking, since the minor route service cuts have been in place for over a year now, whether the cost savings anticipated have actually been achieved.

David Hendry (BCF Director, Strategic Planning) said BCF has been asked about the minor route cutback results at all the FAC meetings they’ve been at so far.

He said BCF’s year-end is March 31 and as the company is governed by securities regulations they are in a blackout in terms of year-end results.

“Those will be public next month. As part of that, the Board has asked for an analysis in terms of cuts made, savings achieved, et cetera. 

“Those will go in the public report that comes out in August of this year. That’s the high level, and from there we go into the detailed analysis on a route-by-route basis.

“We do seem to be achieving the targets, but there is variation across the routes.”

Nicholas said she was pleased to hear there was a route-by-route analysis being done and asked when that specific information would be coming out.

Hendry said BCF could not commit to making that information public, as the target savings were system wide, based on the cross-subsidized system currently in place. 

Nicholas said, “The communities impacted want to see the breakdown so they know what has been achieved by them.”

This was when she asked about the major routes.

“I’ve been given to understand that despite the fact we’ve gotten these cuts on the minor routes - and there was a commitment in $4.9 million in cuts to the major routes - it is my understanding that BCF is looking at achieving those savings not through service cuts.”

Hendry said she was correct.

“The $4.9 million will be achieved through cost savings or net savings across the system.

“That’s been built in to the new performance term. We have been tasked with finding those savings as part of that. 

“We did look at trying to find those savings on the major routes, we looked at options, all those came back to incurring more revenue loss than savings.”

He added that the other part was since the 2007/2008 fiscal, a number of changes have already been made to the major routes.

“It became harder to achieve savings.”

Nicholas said it would be appreciated if the minor routes could share the opportunity to realize savings without service cuts. 

“It seems unfair. 

“It was clear originally that the smaller islands were taking the first round of cuts, major routes were to take the second round. We took our cuts and they didn’t and won’t.”

John Hodgkins, FAC Chair, said, “The government was very specific our [the minor routes] savings had to come from cuts. Now they are saying it is okay to find the savings somewhere besides the major routes. It seems to be an inequitable approach.”

Hendry said, “You can comment on it, take it to the province. 

“The other thing is we’re tasked to look for longer term savings on the major routes, well beyond the $4.9 million per year.”

“We were looking at things in the fall - that was raised, viewed publicly, there was backlash - it was decided at the provincial level not to proceed in that direction.”

As part of a long-term vision for potential savings for BC Ferries, a report generated in the fall of 2014 suggested the closure of the Departure Bay and Horseshoe Bay terminals and the connecting route would mean considerable savings. As Hendry said, a public backlash led to provincial Transportation Minister Todd Stone committing to not closing either terminal or the route.