THE First Minister has urged to halt plans to privatise Scotland’s island ferry network with concerns that the most lucrative routes will be sold off.

The Herald revealed that global consultants Ernst and Young have been tasked by ministers to look into the "unbundling of routes into smaller packages" as part of options for "decentralisation" leading to concerns over the future for state-controlled ferry operator CalMac.

Details have emerged in a brief given to Ernst and Young for Project Neptune - which is examining the Scottish Government-controlled structure that underpins Scotland's ferry service.

It comes after the Competition and Markets Authority expressed concern about the "potential risks" of state control over the way ferries are operated, run and paid for.

There has been concern that the service is "cocooned" inside four levels of Scottish Government control with the Transport Scotland agency as funders, the procuring and vessel owning company, Caledonian Maritime Assets Ltd (CMAL), the ferry operators Calmac and the now nationalised shipbuilders Ferguson Marine (Port Glasgow).

Transport Scotland 'consultancy requirements' documents reveal that Ernst and Young are looking beyond merely whether the structure is "fit for purpose".

It asks the consultants to make a recommendation of a "potential route/structure for direct award of ferry services contract that Scottish ministers could consider as part of a future strategy".

It also ask the consultants to "include an analysis of the challenges and opportunities associated with options for decentralisation (unbundling of routes into smaller packages)."

The Herald:

Neil Bibby, Scottish Labour's transport spokesman said the move should be halted.

He said: “It’s hard to think of a proposal that would make the ferries fiasco in Scotland worse - but this is it.

"If the SNP have to pay consultants to come up with ideas to fix our ferry network and this is the best they can come up with then frankly this Government has run out of steam and is wasting tax payers money.

"The First Minister Nicola Sturgeon should immediately rule out any suggestion of breaking up the Calmac network and aggressive privatisation.

"If they fail to do so then the Government must explain its position in a ministerial statement to Parliament next week.

"Labour is instead calling on the SNP to urgently develop a new ferries strategy, a national ferry building programme and provide national leadership on this issue."

It comes ten years after transport minister Keith Brown said "no compelling case" had been made that "tendering individual routes or unbundling the current contract" would lead to greater benefits.

This was repeated by then First Minister Alex Salmond who told MSPs in 2012 that the "case for unbundling, in our estimation, has not been made".

At that time, there was concern that it would hive off CalMac’s four busiest routes, as suggested in a 2010 consultation on future ferry services.

The concerns were that the Ardrossan to Brodick on Arran, Wemyss Bay to Rothesay on Bute, Oban to Craignure on Mull and Largs to Cumbrae were to be split off as CalMac's contract expired the following year.

It comes as the state-owned ferry operator CalMac is having to handle an ageing ferry fleet with new lifeline vessels MV Glen Sannox and Hull 802 still languishing in the now state-owned Ferguson Marine shipyard, with costs of their construction more than doubling from the original £97m contract and delivery over four years late.

The Herald:

The debacle led to shipyard firm Ferguson Marine led by tycoon Jim McColl, who first rescued the yard going bust, leading to a Scottish Government takeover.

An investigation by MSPs on the Scottish Parliament rural economy and connectivity committee into the procurement of the ferries described it as a “catastrophic failure”.

It also comes amidst a series of issues with breakdowns involving Scotland's ageing ferry fleet.