[an error occurred while processing this directive]
BBC News
watch One-Minute World News
Last Updated: Friday, 22 December 2006, 07:33 GMT
Rival's anger at CalMac discounts
A CalMac ferry
CalMac faces competition on the Clyde route
Caledonian MacBrayne has been using taxpayers' money to offer secret discounts on one of its ferry routes, BBC Scotland has learned.

The price cuts were designed to lure customers away from rival Western Ferries, which has claimed the move was in breach of UK and European rules.

The Gourock to Dunoon route is the only one where CalMac faces competition.

Its service receives a subsidy of more than 2m from the Scottish Executive, which owns the ferry company.

The subsidy is only meant to support foot passengers, with vehicle tariffs left to face market forces.

Now the executive has conceded that CalMac has used the subsidy to underwrite discounts of up to 70% to hauliers.

Western Ferries is calling on Audit Scotland to investigate the matter.

An executive spokesman indicated that ministers had been unaware of the discounts, which have now been stopped.


SEE ALSO
CalMac routes put out to tender
14 Dec 06 |  Scotland
Ferry routes tendering plan delay
14 Nov 06 |  Glasgow and West
Ferry route fails to attract bids
13 Nov 06 |  Glasgow and West
Ferry firm reports losses of 2m
06 Oct 06 |  Scotland

RELATED INTERNET LINKS
The BBC is not responsible for the content of external internet sites



FEATURES, VIEWS, ANALYSIS
Has China's housing bubble burst?
How the world's oldest clove tree defied an empire
Why Royal Ballet principal Sergei Polunin quit

PRODUCTS & SERVICES

Americas Africa Europe Middle East South Asia Asia Pacific