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MP – Ferry Companies ‘on notice’

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Andrew Turner the Island’s MP has said that although he is disappointed that the Office of Fair Trading (OFT) have indicated they are not ‘minded’ to take the investigation into the cross-Solent ferry markets further at this stage he is ‘certainly not giving up’. His comments came after a report from the OFT released last Friday make clear that although a number of tests have been met that would enable them to refer the matter for a full investigation by the Competition Commission they have provisionally decided to use their discretion against doing so. There is now to be a further period of consultation on the provisional findings with comments invited from interested parties before 12th August.

The report is the outcome of a market survey by the OFT following a campaign by Mr Turner seeking an investigation into whether the Island’s ferry services are working well for consumers. He decided to act following a rise in the number of complaints he received about rising prices and declining services following the multi-million pound takeovers of Wightlink and Red Funnel by financial institutions.

The OFT’s report makes clear that both service frequency and punctuality have decreased in recent years and points out that because the pricing system is very complex it is difficult to compare prices for similar journeys over time. The report also says that service frequency is expected to fall in future years.

A central argument of Mr Turner’s submission is that the high prices paid for both companies had led to substantial levels of debt and would lead to even higher prices in the future. The OFT expressed disquiet about Wightlink’s levels of profit since 1991 and make clear that Mr Turner’s concerns appear ‘justified’ and ‘have merit’ but believe it is too early to tell what the repercussions might be. The report specifically says that this could be revisited in the future when more evidence is available.

Both ferry companies have changed to ‘yield management pricing’. The OFT has concluded that this has led to Islanders who use the ferries as a lifeline service experiencing higher price rises than tourists and other groups who are more able to plan their journeys in advance.

The report suggests that greater transparency from the ferry companies on service and price levels would be of benefit and enable greater scrutiny of the ferry companies in the future.

Mr Turner said :

“I would like to thank the OFT for the work they have done so far. They have accepted my arguments on most of the important points but say that they are ‘minded’ not to take further action. Although they have identified clear concerns about price, quality, choice and innovation they say they have found only ‘limited evidence’ that this has damaged consumers. They are also clearly having trouble finding a suitable remedy to address the problems they have identified.

“I am certainly not giving up on trying to secure a full investigation. I will be meeting the OFT to discuss what information they would need in order to change their provisional findings.

“This report certainly does not give the ferry operators a clean bill of health – far from it. Instead it puts them on notice that there needs to be changes in the way they operate. They have recommended that the ferry operators should provide greater transparency on pricing and service standards. I welcome that. Currently the ferry companies hold all the information, so it is very difficult to challenge them. That was certainly one of the problems I encountered in preparing my case. We need to discuss what can be done to make the operators work harder to deliver value for money services whether there is eventually a full investigation or not.

“The OFT have pointedly not commented on whether a ‘yield management’ pricing strategy is appropriate for a lifeline service. I will be pressing them to come to a view on this.”

Mr Turner went on to say :

“I am perplexed that the OFT have decided it is ‘too early’ to take a view on whether the high prices paid for the ferry companies in recent years will lead to long-term damage to the consumer. I am afraid that is avoiding the issue. My constituents are clearly suffering now and have been for a number of years – I am not sure how long the OFT think that should continue before they will act. That is something I will be following up on.”

END Contact : Andrew Turner’s office 01983 530808

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Broadlands jobs safe

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Island MP Andrew Turner has received confirmation that the future of jobs and services at Broadlands House are secure following press reports that previously announced new jobs would not now be coming to the Island. Mr Turner said that yesterday’s press reports were completely at odds with assurances he had received both from the Minister last summer and the regional manager as recently as November last year. On hearing the reports that plans had changed he contacted the senior management of JobCentre Plus to seek clarification of the position.

Mr Turner said

“I have now received definite confirmation that the plans of Jobcentre Plus have not changed and that they will be keeping a benefit processing centre on the Island as well as establishing one of only two national insurance number processing centres here. I have been told that the additional jobs will arise as their plans are implemented over the coming months.”

Mr Turner went on to say

“During our meeting last November Guy Tompkins Jobcentre Plus’s regional manager was very complimentary about their workforce on the Island and told me that the positive approach of the staff was one of the reasons why they planned to expand on the Island. I am very glad that they see the sense of bringing work to the Island rather than taking it to the mainland and I will continue to press Government to follow their example.

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School Reorganization – Where will £70m come from?

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Government have denied promising the IW Council £70 million to pay for reorganizing Island schools from a three- to a two-tier system. And the Island’s MP has criticized the ‘optimistic noises’ on funding given at consultation meetings.

In a Parliamentary Answer to Island MP Andrew Turner it was revealed that there have been absolutely no promises from the Government to provide the estimated £70 million needed for the changes being proposed by council officials. In answering Mr Turner, Stephen Twigg MP, the Minister responsible for school funding, made it clear that the Isle of Wight council has received no assurances that extra money will be made available for the proposed changeover. Mr Turner has criticized the impression given to parents and teachers that obtaining the money needed from central government would not present a problem.

Andrew Turner said,

“During the meeting I attended at Sandown High School it was clearly stated that ‘we can get’ the £70 million needed to change the system. I was surprised to hear that because that simply isn’t the way that Government works. I have asked the Government what promises they have given and they have clearly told me that they have given none. I have now asked the Council what led them to give such a misleading impression to those who went to the trouble of attending the meeting. I have been told that there have been informal meetings with government officials who support these proposals – I am afraid that does not represent government spending commitments. Frankly I am shocked that optimistic noises were made which misled people.”

Exam results and education standards on the Island are far below the national average and the recent report costing £100,000 by 4S recommended changing the system but did not provide any evidence that this alone would improve standards. Mr Turner went on to say:

“There may well be arguments for changing the system – but changing the system does not guarantee improving standards; the issues should not be mixed up. Even the advocates of change admit it would cost a fortune. If that money does not come from central government it will have to come from existing council budgets and be topped up by Island council taxpayers.

“It is at very least disingenuous to suggest that finding the money to achieve change is not an important issue that needs to be discussed as part of these proposals. I am worried that the Council seems to believe that informal discussions with civil servants translates into promises of many millions of pounds – sadly that is not the case.

“We need to raise standards but that is best done by the Council accepting that some schools are better than others, publishing that information to parents, governors, teachers and the wider public, and tackling the problems on a school-by-school basis. It is not as glamorous as being the architect of a whole new system, but it is much more likely to give our children the quality schooling they deserve.”

END

Contact : Andrew Turner 01983 530808

School Building (Isle of Wight)

Mr. Andrew Turner: To ask the Secretary of State for Education and Skills what (a) commitments and (b) undertakings she has made to the Isle of Wight Council regarding future capital allocations provided (i) through the Building Schools for the Future programme or (ii) otherwise, whether (A) contingent on or (B) not contingent on school reorganisation. [216280]

Mr. Stephen Twigg: A letter has been sent to all council leaders stating that, for authorities not prioritised in the first three waves of Building Schools for the Future (BSF), including the Isle of Wight, we are determined to make a start on BSF plans between 2005–06 and 2010–11. Our ambition is that in the next full Parliament, subject to future spending decisions, 60 per cent. of all authorities will have started in the BSF programme, or else be given resources to renew at least one secondary school with the greatest need as a school for the future, or as an academy. Each BSF scheme will be judged on its merits, and is not necessarily contingent on school reorganisation. Other capital allocations to the council and its schools were announced on 30 November, and are set out in the following table:

£000
2006–07 14,853
2007–08 15,446

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Can we become a Fairtrade Island?

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As World Fair Trade Fortnight draws to a close this Sunday the Island’s MP Andrew Turner has praised the work of the IW Fairtrade Forum. The Forum is working towards the accolade of Fairtrade Island by building on existing users and suppliers of Fairtrade products to spread the word about the products and the good they do for their producers in the developing world. There are now more than 250 products bearing the distinctive green and blue logo which guarantees a fair deal to producers of such items as coffee, tea, sugar and bananas.

Andrew Turner said,

“The Fairtrade product range has expanded over recent years and whilst once they were seen as an expensive alternative they now offer good value and quality. In order to become a Fairtrade Island we need more suppliers of the products so everybody really can make a difference by asking their local coffee shop or convenience store to stock a few items from the range. As the largest constituency in the country the Island gaining this accolade really would make a difference and give a boost to the national campaign. Fairtrade really makes a difference to those communities that need a helping hand – and I know that on the Island we have a really caring and compassionate community”.

Jim Curtis the co-ordinator of the IW Fairtrade Forum said

“I very much value Andrew’s support for this campaign. In order for the Island to be recognised in this way we need the active support of the Isle of Wight council as well as that of suppliers across the Island. I urge everyone to let their local councillors know that they would be proud to see us become a Fairtrade Island helping less fortunate people to take control of their own lives and build themselves a better future.

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