On Monday, the B.C. Ferry Commission announced the numbers for the price cap for the three remaining years of the third performance term for BC Ferries. Fare hikes go into effect April 1 and B.C. Ferry Commissioner Gord Macatee approved increases of 4.1 per cent for 2013, 4 per cent for 2014 and 3.9 per cent for 2015 for major as well as minor routes. The Ferry Commission has given BC Ferries the efficiency target of $54.2 million over four years; service level cuts are expected to yield $30 million in savings.
In a press release, the Ferry Advisory Committee Chairs (FACC) expressed concern that fare hikes over three years are double the inflation rate. "Fares will continue to grow much faster than people's incomes unless government faces the causes of the affordability crisis," says Tony Law of Hornby-Denman FAC.
Councillor and member of the Bowen Island Municipal Ferry Advisory Committee Alison Morse said, "After a fare increase of 4.15 per cent went into effect this year, it now costs $51.70 for a car and two passengers to visit Bowen and, with an experience card, a car and two passengers comes to $32.40.The fuel surcharge is then added on top of that. [After next year's fare hike,] it will be $58.16 for a car and two passengers. That makes it quite expensive for someone just coming over for the day. For experience card users, it will be $33.72 still a lot of money. If you are two seniors and can travel Mondays to Thursdays, then you just pay $20.30 for the car which explains why many seniors go off island during the week and come for the weekend on Thursday."
In January, a B.C. Ferry Commission study found that ferry fares were then at the tipping point of affordability, and causing hardship in coastal communities. The FACC commented that since then, fares were raised by 4.15 per cent and, next year, those fares will have another 4.1 percent increase, followed by two more increases in 2014 and 2015, not including the existing fuel surcharges that are likely to change with future fuel prices.
Fare increases are calculated by the B.C. Ferry Commission based on numbers from BC Ferries and the government and the FACC state, "Key numbers come from the government's response to the commission affordability report including the $74 million in cuts over the next three years ($30 million in service cuts, $15 million in new BC Ferries efficiencies, and $29 million remaining of previously agreed-upon efficiencies of $9.8 million per year) and $33 million in new government contribution to BC Ferries over the next three years." The new money aims to help BC Ferries maintain a good bond rating and reduce upward pressure on fares and without it, fare hikes would have been a few percentage points higher, according to the FACC.
"The press release makes reference to the government consultation program that will identify ways to cut service to generate the $30 million in cost savings that the government has said must be found," Morse said. "As of now, we still do not know any details of the consultation program except that [the province has] hired Kirk & Co to manage it."
The FACC say that the effect of the cuts on future fares and traffic is harder to assess but they are concerned that service cuts - unless they're done carefully and with ideas from communities - could aggravate the downward spiral in traffic and upward spiral in fares."Both spirals are the kiss of death to dozens of coastal communities," says Brian Hollingshead of Southern Gulf Islands FAC. "More than anything, we need a public policy approach that aims to sustain our communities, stem the damage from high fares, and grow our potential."
And the FACC believe that the government has to recognize that ferry service is part of B.C.'s core infrastructure and bear a greater share of the costs that are causing escalating fares, such as fuel prices, revenue shortfalls from falling traffic and overdue and urgent need to replace very old ships and docks.
