Isles of Scilly: Ships

Lord Berkeley Excerpts

Tuesday 23rd November 2021 Lords Chamber

Asked by

[Lord Berkeley]

To ask Her Majesty’s Government whether their award of £48 million from the Levelling Up Fund to the Council of the Isles of Scilly for the purchase of new ships requires the Council to demonstrate value for money by arranging competitive tenders for the (1) procurement, (2) construction, and (3) operation, of the ships.

[The Parliamentary Under-Secretary of State, Department for Transport (Baroness Vere of Norbiton) (Con)]

My Lords, the Council of the Isles of Scilly submitted a full application, which included an economic and a commercial case. The Department for Transport reviewed these documents through a detailed assessment process, including assessing the value-for-money of the application. The process is set out in the fund’s technical and explanatory notes. Officials from the DfT will be writing to the Council of the Isles of Scilly to set out further business-case requirements.

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[Lord Berkeley (Lab)]

My Lords, I am grateful to the Minister for that response. However, she did not say whether the council would be required to go out to tender for the supply of the ships or operating the service. At the moment, the application is to give the Isles of Scilly Steamship Company—the monopoly supplier of services—a free gift of something like £48 million to operate a service, with no conditions. Does she think that is the normal way to conduct public sector financial business?

[Baroness Vere of Norbiton (Con)]

I am pleased to be able to reassure the noble Lord that, of course, the current status of the bid is that it is in its very early stages. As I said, we will be writing to the sponsor setting out further requirements for the business case. By the time this comes for ministerial sign-off, we will have had not only an OBC but also an FBC, and it will be done with the five different businesses cases. That would be normal, according to the Treasury rules. It will be a very rigorous process, during which we will, of course, assess the commercial elements of the bid. The noble Lord should just follow the process carefully; the bid would appreciate his support and guidance in getting it through the government systems.