The British Columbia Ferry Commission announced Friday a preliminary cap on fare hikes by BC Ferries at 9.2 per cent annually over the next four years, starting in 2024; however, a $500-million cash injection from the provincial government into ferry operations will likely lower the need for such an increase.
“Continued labour supply issues, rising fuel prices, escalating costs associated with maintaining an aging fleet, and a 12-year, $5.2-billion proposed capital plan driven by a need to replace vessels will create substantial pressure. Given this, we believe that a price cap of 9.2% is appropriate and necessary to allow BC Ferries to meet the demands of the upcoming performance term,” stated commissioner Eva Hage.
“Certainly the $500 million will help alleviate a significant amount of the pressure facing our ferry system and allow us to lower the final price cap accordingly,” said Hage.
The announcement was quickly responded to by Minister of Transportation Rob Fleming via his own statement to media: “The commissioner's preliminary decision does not yet factor in the $500-million contribution to support fare affordability. I want to assure British Columbians, particularly those who rely on our coastal ferry service, that our goal of holding annual average fare increases to no more than 3% remains.
"As the commissioner works toward a final price cap decision by Sept. 30, 2023, she will incorporate the $500-million contribution to inform her final decision on the price cap for the next four-year term,” stated Fleming.
The commissioner stated BC Ferries' capital plan has already been reduced by $330 million and the 9.2% cap is contingent on BC Ferries implementing $10 million in operating cost savings over four years.
“The corporation must demonstrate good fiscal management and find a solid footing in which expenses align with revenues. To that end, we are requiring BC Ferries to provide us with a plan that sets out the steps it will take, in consultation with the province, to ensure a financially sustainable, safe, reliable and affordable ferry system over the long term,” stated Hage.