Fare cap decision is due

Today (30 September) is the deadline by which the Ferry Commissioner is required to set the new fare cap (the maximum level by which the average fare charged by BC Ferries may rise) for the remainder of Performance Term 3. An announcement from the BC Ferry Commission is expected tomorrow.

9 months ago, the Ferry Commissioner laid down a challenge to the Provincial government to cap the rate of future fare increases at the rate of inflation – stating that be believed that fare levels had reached “the tipping point of affordability”.  Then in April, ferry fares increased by a further 4.15% – half the amount originally identified by his predecessor as being required to ensure the financial sustainability of the ferry company. The government found extra cash to cover the shortfall, but announced in May that up to $30 million in savings from service adjustments would be necessary in order to balance the books by the end of Performance Term 3 in 2016.

The Ferry Commissioner now had a challenge of his own – the government did not accept that an inflation-linked fare cap was deliverable (at least yet), but former Minister, Blair Lekstrom, hinted that his aim was to limit fare increases to no more than 4%.  The Commissioner has an obligation to set a fare cap that will ensure a return on equity for BC Ferries (though not the 13% previously legislated) and in setting the fare cap he has to make a judgment on how much revenue BCF will receive from vehicle and passenger fares. That’s a particularly tough call, as BCF’s traffic continues to fall, year on year, with limited signs of recovery so far.

So, tomorrow we should see the outcome of the Ferry Commissioner’s deliberations. Will he be able to limit the increase to 4%? We will see. One thing’s for sure. Whatever the level of fare cap, the prospect of rising fares and likely service cuts looks like a double-whammy yet again for ferry users.


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