Freight: Proposals to raise ferry fares by 50%. Pic: © STV
Plans to scrap a ferry subsidy for Western Isles hauliers could have a major impact on jobs and the local economy, a report warns.
A new study has suggested the removal of subsidies – which would mean a 50% freight fare rise for ferry travel – could affect living costs and jobs.
The economic impact study commissioned by Western Islands Council warns that the move could see big price-rises almost immediately.
The road-equivalent tariff is a thorny issue on the islands, with some locals complaining that hauliers have not passed on the savings that they make onto the price of goods.
The Scottish Government has announced plans to end the RET for freight travel, but roll it out to other Hebridean islands.
The economic study warns that axing the ferry subsidy could cause a £10m economic down turn in the Western Isles and risks 100 jobs.
Hundreds of homes built on the islands are done on a self-build basis, but the cost of construction could rise by an extra £5000 per home, the study says.
A large salmon processing firm says it would mean the price of exporting fish onto the mainland would rise, and be compensated by cuts and threats to jobs and new investments.