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SCHEDULE 3
INVITATION TO TENDER
CLYDE & HEBRIDES FERRY SERVICES SERVICE

SPECIFICATION

3.1 Introduction

3.1.1 This Schedule provides a specification of the outputs and core requirements for the Clyde & Hebrides ferry services (CHFS). Key considerations have been the objectives of Ministers, the services which the Executive wishes to procure, the needs of the communities served and the geographic environment in which the services will operate.

3.1.2 The requirements outlined in this Schedule deal with minimum service levels together with the maximum fares which Scottish Ministers wish to see incorporated into the tender for the Clyde & Hebrides ferry services (CHFS) network. The Technical Submission should set out how the tenderer intends to provide the services so as to satisfy the requirements of Scottish Ministers. Tenderers should consider all requirements set out in this specification.

3.1.3 The successful tenderer will be responsible for ensuring that the service specification requirements are achieved in full.

3.2 Minimum Service Level

3.2.1 The minimum service level is sub-divided into the following key requirements:

The Route Network
Vessels
Provisions for Carriage
Timetables
Fares Structure, including Concessions
Brand and Marketing
Integrated Transport, Ticketing and Information
Network-Wide Support Services
Passenger Facilities
Language
Consultation
Utilisation of Vessels and Ports
Performance Regime
Safety
Ports and Safety
Environmental Protection
Information from the successful tenderer

3.3 The Route Network

3.3.1 The geographical area of operations and the route network are shown in Figs. 1 and 2:

Figure 1 - Area of Operations

Figure 2 - Existing Route Network in the Clyde & Hebrides

The successful tenderer is required to provide scheduled services on the routes listed below as specified in the timetables ( Annexes 6 and 7) and at Annex 1. The timetables set out sailings in detail throughout the year.

Tenderers must include, as part of their technical submission, a clear statement confirming that this requirement will be met and detailed proposals setting out how they intend to provide the required services.

• Tarbert (Loch Fyne)-Portavadie
• Tarbert-Lochranza (Arran) (winter-only - this service is operated when the Claonaig-Lochranza service does not operate to offer an alternative route to Arran particularly for dangerous goods. Other freight, passengers and vehicles are also carried on this service.)
• Wemyss Bay-Rothesay*
• Colintraive-Rhubodach
• Ardrossan-Brodick (Arran)*
• Claonaig-Lochranza (Arran) (limited service - summer-only and extending a week into the winter timetable)
• Largs-Cumbrae Slip
• Tayinloan-Gigha
• Oban-Colonsay
• Kennacraig-Port Askaig (Islay)-Colonsay-Oban (Summer only)
• Kennacraig-Port Ellen (Islay)
• Port Askaig (Islay) Oban Craignure (Mull)
• Lochaline Fishnish (Mull) Fionnphort
• Iona Tobermory (Mull)
• Kilchoan
• Oban-Lismore
• Oban-Coll-Tiree
• Sconser (Skye)-Raasay
• Mallaig-Armadale (Skye)
• Mallaig-Small Isles (Canna, Rum, Muck, Eigg)
• Oban-Castlebay (Barra)/Lochboisdale (S. Uist)
• Barra-Eriskay (CalMac began operating this route in summer 2003.)
• Uig (Skye)-Lochmaddy (N. Uist)**
• Berneray-Leverburgh (Harris)
• Uig (Skye)-Tarbert (Harris)**

Ullapool-Stornoway (Lewis) tenderers should note that in addition to the timetabled passenger/vehicle service, they must also provide a separate night freight service on this route ( see Annexes 6 and 7 for details).

*In the event of adverse weather, the Ardrossan-Brodick and Wemyss Bay-Rothesay services should run to/from Gourock (as now) provided conditions at Gourock are considered acceptable by the Master.

**On some days in the winter timetable, the Uig-Tarbert and Uig-Lochmaddy routes operate as a Uig-Tarbert-Lochmaddy services, to serve both Outer Isles ports.

3.3.2 With the exception of Claonaig-Lochranza, Tarbert-Lochranza and the service between Islay and Colonsay (Kennacraig-Port Askaig-Colonsay-Oban), all of these routes are year round passenger/vehicle/freight services. Winter and summer timetables are provided at Annexes 6 and 7. Tenderers may also wish to note that in the case of Tobermory-Kilchoan the winter vehicle service was provided for the first time in winter 2003/04. A brief description of each route and annualised carrying statistics for each are provided in Annex 2.

3.4 Vessels

VesCo

3.4.1 Tenderers are required to lease sufficient vessels to deliver all of the requirements of this tender including services and fleet relief requirements for the term of the contract.

3.4.2 As mentioned previously, the successful tenderer will be bound to charter/lease vessels they require from the existing fleet from VesCo on a bareboat basis. However, there will be flexibility in terms of the numbers of vessels leased. The receipt of subsidy is contingent upon the successful tenderer being bound to lease its vessels from VesCo for the duration of the contract. Technical submissions should include a clear statement ( Schedule 7) confirming that the tenderer accepts this requirement.

3.4.3 The successful tenderer shall be responsible for the operational management of the vessels, including manning, repairs, running maintenance (including annual overhauls), insurance, etc., for the duration of the contract. The contract between the successful tenderer and VesCo will describe in full the rights and responsibilities of the parties. VesCo will have inspection rights throughout the contract and there will be condition surveys at the outset and at the end of the contract period. In addition VesCo or its representatives will have the right to attend each vessel's dry docking to assess the condition of the hull and all underwater areas. The successful tenderer will be required to maintain the ships' condition throughout the contract period to at least that prevailing at the outset, fair wear and tear excepted. VesCo will provide details to tenderers of the standard of maintenance required.

3.4.4 The terms and conditions of the vessel leases will also delineate the responsibilities and the process required for capital investment i.e. where statutory changes/improvements are required or where the successful tenderer wishes to effect alterations/additions to upgrade vessels which will provide improved revenue streams for periods beyond the term of the contract.

3.4.5 It will be for tenderers to agree their requirements with VesCo. All tenderers, in their dealings with VesCo, will be treated equitably. Tenderers will wish to note that terms will depend on detailed proposals including number and type of vessels to be leased (although menus will be available to all tenderers on an equitable basis).

3.4.6 Tenderers are encouraged to be innovative in making flexible use of the ships available from VesCo in order to secure the most efficient array of vessels to serve the network. It will be for tenderers to decide how to deploy these vessels (and, for that matter, the fleet as a whole) to best serve the CHFS route network. Annex 3 provides information on how the fleet is usually deployed. However in doing so tenderers must have regard to the carrying patterns and deploy the fleet effectively to meet demand as far as possible. Tenderers should note that the VesCo fleet is enrolled under the British Register.

Passenger Facilities

3.4.7 Facilities on board VesCo's vessels vary according to age, size and type and also according to which routes each vessel currently serves. Details of available on-board facilities are listed in Annex 3. The successful tenderer shall ensure that equivalent on-board facilities, restaurants, cafeterias, vending machines, cabins, etc., are available although there will be some flexibility in relation to the times these are made available and format of such services. The Technical Submission should include a statement confirming that, if successful, the tenderer will comply with this requirement and details setting out how the tenderer would meet this requirement. It is hoped that this flexibility will allow tenderers the opportunity to be innovative in the way these services are delivered and improve services to customers. As a minimum, the Technical Submission should provide for light refreshments on short journeys and meals should be provided on longer journeys (although, tenderers have freedom to decide how best to provide this). Tenderers must specify the services that will be available on board ships and the shore facilities and to highlight where these differ (in terms of hours of availability and scope) from existing services as part of their bid.

Fleet Relief

3.4.8 The successful tenderer will be required to provide for relief capacity to cover scheduled maintenance, dry dockings, unforeseen breakdowns and ensure continuity of service. It is the successful tenderer's responsibility to provide all fleet relief for the duration of the contract. Details of designated "relief vessels" ( Isle of Arran, Raasay and Bruernish) currently used to cover scheduled dry dockings and unscheduled stoppages are included at Annex 3. Tenderers will wish to note that, on occasion, it is current practice to maintain service levels not by using a relief vessel as a direct replacement, but by adjusting the schedules of vessels on other routes or by cascading vessels throughout the network in order to maximise carrying capacity and maintain continuity of service. Normal ongoing fleet relief requirements should be planned for and included in negotiations with VesCo. Fleet relief vessels should be leased by the successful tenderer (from VesCo) on a permanent basis. However, in exceptional circumstances, tenderers may find they require additional vessels and (if VesCo has none) may charter from other providers if necessary to meet emergency and unforeseen pressures. Such vessels will be subject to the approval of Scottish Ministers.

3.4.9 It should be noted that, although the Isle of Arran is currently a designated "relief vessel", to meet capacity constraints it is currently deployed during the summer timetable serving Islay. The timetable for Islay highlights the additional sailings which are provided by the relief vessel and explains that they are subject to withdrawal at short notice. These sailings are part of the minimum standard but this means that should the vessel offering these sailings be required to provide relief cover elsewhere in the network, these sailings can be cancelled without triggering the performance regime. With this exception, all other parts of the performance regime apply to these sailings.

3.4.10 Tenderers must, as part of their technical submission, specify the arrangements made and response times for fleet relief. These arrangements should cover both periods of planned overhauls and periods during which vessels are unable to provide the service in unforeseen circumstances such as breakdowns or damage.

Use of Non-VesCo Vessels to provide the Approved Services

3.4.11 There will also be flexibility for tenderers to propose bringing their own vessels to provide the Approved Services. However, tenderers may only propose to bring their own vessels to provide the minimum standard if they have taken all the VesCo's available vessels for CHFS. Tenderers will wish to note that where they intend to use non-VesCo vessels this will be subject to the approval of the Executive. All non-VesCo vessels that are used to provide the Approved Services must be of at least the same standard as the current CalMac fleet. Technical submissions should include a clear statement (Schedule 7) confirming that the tenderer accepts these requirements. Where tenderers intend to bring their own vessels the technical submission should include full details of the proposed vessels and their proposed deployment.

3.4.12 Any non-VesCo vessels used by the successful tenderer to provide the Approved Services must be classed by a recognised organisation as defined in EU Directive 94/57/EC (as amended) and authorised by the United Kingdom. Technical Submissions should contain a clear statement ( Schedule 7) confirming that this will be so. Where additional vessels are proposed the Technical Submission should include full details about the vessels and what services the tenderer proposes to use the vessels on.

3.4.13 The successful tenderer may, of course, bring its own vessels to provide services over and above the minimum level of Approved Services.

Use of VesCo Vessels outwith the Approved Services

3.4.14 Submissions must contain a clear statement ( Schedule 7) confirming that tenderers will lease the vessels they require from VesCo, and accepting that these will be deployed on the routes of the CHFS network. Tenderers' proposals to use VesCo's vessels on services other than the Approved Services will require approval from VesCo and the Executive.

New VesCo Vessels during the lifetime of the contract

3.4.15 VesCo will also be responsible for acquiring new vessels to serve the network through a planned replacement programme. The successful tenderer will also be bound to new vessels as they come into service to replace or augment the fleet. The successful tenderer may be required to operate these new vessels on particular routes. Technical submissions should include a clear statement ( Schedule 7) confirming that the tenderer accepts these requirements. The subsidy will be adjusted, through the Change Mechanism ( paragraph 2.5.44 in Schedule 2), to take account of variations in respect of new services and/or vessels which the successful tenderer will be required to operate.

VesCo Vessels

3.4.16 The Executive is of the view that VesCo's fleet, at the point of award of contract, is suitable for the network and fully safety compliant. Between 1983 and 2003, 21 new vessels were introduced into service on the network. Most recently two new vessels were brought into service in 2003 serving the Mallaig-Armadale route in summer and the Sound of Harris routes. This in turn allowed redeployment of the Loch Bhrusda to provide the Sound of Barra service and the Lord of the Isles to enhance summer services provided from Oban. Unless specified otherwise, all existing vessels are routinely equipped to carry passengers and vehicular traffic. The table at Annex 3 sets out a description of the fleet (age, class and capacity). As tenderers will note, car/passenger capacity can alter depending on the passenger certificate allocated to the vessel for a specific route and season.

3.4.17 Outline details of the vessels in the fleet and their proposed winter 2004/05 and summer 2005 deployment is also provided at Annex 3. Tenderers will wish to note that winter deployment is more flexible to allow for overhaul.

3.4.18 New berthing infrastructure on the Small Isles became fully operational in April 2004. Shore berthing is now possible by MV Lochnevis at Eigg, Muck and Rum, and the previous practice of using flit boats to transfer passengers and freight to these islands is no longer required.

3.4.19 In addition tenderers should note that Ministers intend to make two Streakers (Saturn and one other) available to the tenderer for the Gourock Dunoon route (on an optional basis). If the Gourock Dunoon operator does not utilise these, they may be available for the main Clyde and Hebrides network if tenderers wish. However there should be no assumption that this will be the case.

3.5 Shore Infrastructure

Use of Piers and Harbours

3.5.1 The vessels are supported throughout the network by shore infrastructure adequate to deal with vessel operations, passenger handling and the loading, carriage and discharge of cars, freight, dangerous goods and livestock. The CHFS network operates from 48 ports consisting of a variety of piers, slipways, linkspans, car marshalling areas, passenger facilities and other buildings. The ports are owned and/or operated by a number of bodies, of which 24 of the terminals are the property of VesCo with the remainder in the ownership of local authorities, harbour trusts and Clydeport plc. Annex 14 provides ownership details of the ports for the existing CHFS route network. Annex 18 contains summary information and contact details for non-VesCo harbour authorities.

3.5.2 For all harbours, the successful tenderers will have responsibility for all shore side activities including (but not limited to) mooring, unmooring, marshalling, loading and unloading of passengers, vehicles, freight and livestock, operation of linkspans, provision of waiting rooms, as well as the manning of ticketing, reservations and other shore based facilities. Technical submissions should include a clear statement confirming that the tenderer accepts this requirement and details setting out how the tenderer intends to provide this requirement at all network harbours.

Non-VesCo Harbour Authorities

3.5.3 Some network piers and harbours are owned by others e.g. local authorities, Clydeport Operations Ltd or harbour trusts. It will be for tenderers to negotiate, with harbour authorities, the detailed arrangements for the use of ports, harbours and port assets. Tenderers will wish to note that there are various arrangements throughout the network for the operation of linkspans and other harbour facilities. Each tenderer will be given the same information from the harbour authorities but it is recognised that there may be differences about specific aspects for handling in relation to any particular vessels. The Executive has emphasised to all network harbour authorities that all tenderers should be treated equally and fairly. As part of their technical submission, tenderers must set out in detail how they intend to provide the shore side requirements of the Approved Services. This will include the terms of proposed agreements with harbour authorities and how functions will be delineated. In particular they should address the issue of responsibility for mooring, marshalling, loading and unloading of passengers, vehicles, freight and livestock, and the manning of ticketing, reservations and other shore based facilities.

3.5.4 Tenderers will need to assess what is necessary in terms of staffing to provide shore services and to make appropriate arrangements to provide (as part of this tender) if necessary, in relation to CHFS services. It should be noted that the contractual provisions in relation to TUPE do not apply to staff of other harbour authorities except in certain cases where shore staff are currently provided by Caledonian MacBrayne (and subsequently OpsCo).

3.5.5 At Costed Bid stage, tenderers will be required to confirm the details of the financial arrangements proposed with harbour authorities.

VesCo Harbours

3.5.6 Piers, quays and harbour facilities currently owned by CalMac will become the property of VesCo and will be utilised by the successful tenderer on a commercial port/harbour fee basis which will be agreed directly with VesCo (harbour/berthing dues, etc.).

3.5.7 For ports and harbours owned by VesCo, the successful tenderer shall pay harbour dues and other relevant charges for utilisation of those harbours. Such charges will be offered on an equivalent basis to all tenderers. The successful tenderer will be responsible for all shore side activities as set out at paragraph 3.5.2 above. The Technical Submission should include a statement ( Schedule 7) confirming that provisional arrangements are in place with VesCo for the use of the harbours for the operation of the CHFS services. The Technical Submission must set out in detail how the tenderer intends to provide the required shore based facilities at each harbour.

3.5.8 Tenderers are reminded that they must bid as if TUPE applies. Staffing assumptions for the contract period must be detailed in the technical submission which should also include a clear statement confirming that the staffing assumptions comply with the requirement to bid as if TUPE applies. Tenderers should note that staff costs will be required to be clearly shown in the Costed Bid.

3.5.9 The successful tenderer shall also conclude a Harbour Management Agreement with VesCo in respect of certain harbour functions at VesCo-owned piers and harbours, in return for a set management fee (see paragraphs 3.5.10 to 3.5.13 below). Harbour Management Agreement

3.5.10 Overall responsibility for the ownership of fixed assets, ports and terminal facilities, including capital expenditure, will rest with VesCo. However, the successful tenderer, through a Harbour Management Agreement with VesCo, will be required to carry out certain harbour management functions in return for an agreed fee. Technical submissions should include a clear statement ( Schedule 7) confirming that the tenderer accepts this requirement.

3.5.11 Arrangements may vary slightly from harbour to harbour and tenderers will require to discuss them with VesCo. Tenderers will wish to note though that VesCo's responsibilities in relation to harbours is intended to be narrow and focus on certain Harbour Authority functions and ownership of the assets (e.g. maintenance). Therefore the Harbour Management agreement will also be fairly narrow. The main harbour function in relation to day to day operation of harbours is firmly within the main tender and will be the responsibility of the successful tenderer.

3.5.12 Tenderers will wish to note that they will be treated equitably by VesCo and the Management fee (in respect of the Harbour Management Agreement described above) will be the same for all tenderers. The Management fee in respect of each harbour and in total should be shown in the bid and any adjustment which tenderers feel is necessary to deliver these functions should be identified separately within the bid.

Maintenance

3.5.13 Tenderers will wish to note that expenditure for maintenance and improvements of piers and harbours will be the responsibility of VesCo. In the case of the latter, development of shore infrastructure is linked to vessel procurement (a VesCo responsibility). However, the successful tenderer may be required to manage and/or commission some of this work under the terms of the Harbour Management Agreement. Detailed arrangements for maintenance, capital expenditure and revenue requirements in relation to VesCo harbours will be set out under the terms of the leases agreed with VesCo.

Associated Facilities

3.5.14 The successful tenderer shall ensure that, as a minimum, all shore facilities, waiting rooms, reservation offices, cafeterias, etc., are available to users at the times currently provided and that the extent of such facilities is maintained to at least the existing level. Annex 17 sets out the current facilities. The Technical Submission should include a statement confirming this and details setting out how the tenderer, if successful, would meet this requirement.

3.5.15 VesCo will in future own all terminals currently owned by CalMac and most offices, etc. will be available for lease to tenderers. The successful tenderer is not required to lease VesCo owned ticket offices, etc. but must provide equivalent facilities. As already mentioned, tenderers will wish to note that the Gourock-Dunoon passenger route is being tendered separately. This may have implications for the availability of some offices and facilities at Gourock. It is likely that most of Caledonian MacBrayne's present headquarters at Gourock would be available for lease for the main Clyde and Hebrides tender. However, for example, the waiting room and passenger parking area may be needed by the successful tenderer for the Gourock-Dunoon route. Tenderers are responsible for discussing these issues with VesCo but there should be no presumption of availability of all facilities at Gourock.

3.5.16 Tenderers shall negotiate separately with the relevant local authorities, harbour trusts and Clyde Port in respect of their use of the various CHFS-related terminals not owned by VesCo.

3.5.17 Tenderers are encouraged to consider improvements and innovations in respect of passenger facilities ( see Annex 11) e.g. baggage check-in and handling facilities at various ports, which we know some foot passengers would appreciate.

3.6 Provisions for Carriage

3.6.1 Tenderers must include, as part of their technical submission, detailed proposals setting out provisions for carriage of passengers, vehicles, freight, livestock and dangerous goods.

3.6.2 In determining which VesCo vessels might best serve particular routes, the successful tenderer will be required to ensure that the vessel selected is capable of providing the same service standard in respect of carriage of freight, livestock, etc. as is currently provided. This includes capacity, facilities and reliability of service as set out elsewhere in this document. It will be the successful tenderer's responsibility to ensure that the MCA approves the proposals for meeting this requirement and that all operational arrangements are in place to secure the safe delivery of this requirement.

Passengers and Vehicles

3.6.3 Passenger, bicycle and vehicle services must be provided as now to meet the current carrying patterns and to meet the successful tenderer's forecasted trends throughout the contract period. See below for further details in relation to passenger ship and shore facilities.

Freight

3.6.4 All of the current vehicle services provide for the carriage of freight.

3.6.5 In addition, there is a night freight service on the Ullapool-Stornoway route. There is no printed timetable, but the service operates 6 nights a week, departing Stornoway around 2330 and returning to the port at 0800 the following morning. The steaming time is generally 3.5 hours with an hour turnaround time in Ullapool. This is a flexible freight service which accepts dropped trailers. Bidders will wish to note that this can lead to increases in turnaround times. The timetable is usually adjusted in the run up to Christmas to accommodate the island salmon producers.

3.6.6 The carriage of freight must continue to be part of the services available. There are also loose freight services on some routes ( see Annexes 9 and 10) and these should be continued. The successful tenderer is required to guarantee the carriage of freight including, by prior arrangement, livestock and dangerous goods. It is, however, for tenderers to determine the precise level of freight services that are to be made available. The Executive requires, however, that capacity to carry at least the levels provided by the existing operator plus reasonable estimates of growth should be available for freight, livestock and dangerous goods. Tenderers are encouraged to explore expansion of loose freight services where possible to assist small businesses on remote islands.

Livestock

3.6.7 On the CHFS network the majority of livestock are carried in purpose-built livestock lorries operated by specialist hauliers. Because livestock are carried in lorries which are part of the normal ro-ro traffic, total figures for numbers of animals carried are not available. However, the annual number of sailings per route which carried livestock in 2002/03 and 2003/04 can be found in Annex 5. More detailed information will be available to tenderers via the information room.

3.6.8 The services required for freight must continue to include sufficient appropriate capacity for the carriage of livestock. The services must be available all year round and be able to cope with seasonal peaks in late summer. The successful tenderer will be required to ensure that all appropriate regulations are complied with and we would draw tenderers' attention to the Welfare of Animals in Transit Order 1997. Livestock, and vehicles containing meat or fish products, should be separated from passengers and passenger vehicles as far as practical.

Dangerous Goods

3.6.9 By the nature of the geography of the Highlands & Islands, the CHFS network provides the only inward route for dangerous goods to the Islands. The successful tenderer will be expected to continue to provide services for the carriage of dangerous goods as part of the freight service requirement. Annex 4 gives details of the quantity and type of dangerous goods carried on each route in 2002. The goods carried vary in type and degree of hazard. Some commodities (petrol, calor gas) are in steady demand with seasonal peaks for others (hay - spring; fertilisers - early summer). The successful tenderer will be expected to ensure that suitable arrangements can be made for carrying at least the classes of freight mentioned in Annex 4. The carriage of such goods may be achieved by the use of existing vessels or through a contractual arrangement with another operator. In either case, the successful tenderer will be responsible for providing the prevailing level of service delivery in respect of products, frequency and destination.

3.6.10 It is the responsibility of the successful tenderer to make sure that the arrangements which are to be put in place for the carriage of dangerous goods meet the requirements of The Merchant Shipping (Dangerous Goods and Marine Pollutants) Regulations 1997 (as amended) and all other relevant legislation applicable to ships within UK Territorial waters. The Merchant Shipping (Dangerous Goods and Marine Pollutants) Regulations 1997 made mandatory the International Maritime Organisation's (IMO) recommendations for shipping dangerous goods. Details of all substances classified as a dangerous good can be found in the International Maritime Dangerous Goods (IMDG) Code - the relevant current publication is ISBN No 92-801-5090-1.

3.6.11 Tenderers should be aware that the current pattern of services involves the carriage of dangerous goods under MCA exemptions, issued on acceptable equivalent arrangements for the safe carriage of these cargoes. It is likely that the current pattern of mixed services using ships with open car decks (rather than, for example, dedicated dangerous goods sailings) is the most effective means of securing economic services. However, while meeting all relevant current and future legislative requirements to convey livestock and dangerous goods safely, the successful tenderer will not be required to adopt the same configuration of conveyance strategies as described here if more efficient solutions can be found. It will be the successful tenderer's responsibility to ensure that all the services which currently carry livestock, dangerous goods and general freight continue to possess this capability and capacity. Tenderers should be aware that where an exemption is required they should submit proposals to the MCA for consideration at an early stage.

3.7 Timetables

3.7.1 The frequency and timing of timetables for the network have evolved gradually and been shaped by historical operational conditions, annually agreed subsidy levels and ferry users' preferences.

3.7.2 The Executive recognises that specific timetable elements may require adjustment from time to time to meet the changing needs of users. In addition, service delivery may be improved, or level of subsidy reduced, by the introduction of some modifications to the existing timetables. However, Scottish Ministers consider that it is essential for this contract in particular, to ensure that current timetables should not be unduly modified in order that services are protected for users and that all stakeholders may gain experience of the new pattern of service delivery.

3.7.3 For this reason, the summer and winter timetables for the specified routes are to be delivered as seasonal minimum level of service and must not be varied without the approval of the Executive. Timetables are attached at Annexes 6 and 7.

3.7.4 The period for the summer timetable is to be observed throughout the contract. The summer timetable should apply for a minimum of 28 continuous weeks, and we expect that, to allow sufficient time for winter overhauls, it will be unlikely to exceed 30 weeks (although this is for the successful tenderer to consider). Within these parameters, the summer timetable will operate from the start of the majority of Scottish Easter school holidays or Good Friday of the Easter weekend, whichever is earlier, until the end of the majority of Scottish schools' half-term break in October (usually the third Saturday in October each year). The summer timetable will start on a Friday and end on a Saturday. The winter timetable will operate the remainder of the year, i.e. usually from the third Sunday in October until the last Thursday before Easter or the last day before the start of the majority of Easter school holidays, whichever is earlier.

3.7.5 Technical Submissions must contain a clear statement confirming that the timetables in Annexes 6 and 7 will form the seasonal minimum of service under the contract, and that the summer timetable will apply for a minimum of 28 consecutive weeks each year.

Provision Above the Minimum Level of Service

3.7.6 Tenderers are encouraged to develop the timetables, in terms of additional sailings, increased frequency of service and a longer operating day on certain routes. Where tenderers propose provision above the minimum level of service this should be made clear in the Technical Submission.

Approved Service Revisions

3.7.7 It should be noted that after an initial period of six months the successful tenderer may propose to the Executive alterations to the existing timetables providing consultation has been carried out with users in accordance with the arrangements below (section 3.14). Tenderers will wish to note that there are sensitivities around Sunday sailings to and from certain communities. The Executive will expect the successful tenderer to take due account of such concerns in proposing any changes to the minimum standard. If considered appropriate, the Executive may approve these timetable changes by way of an "Approved Service Revision". The successful tenderer may make proposals for an Approved Service Revision after the first six months of the contract and thereafter at six-month intervals.

Unscheduled Special Events

3.7.8 In addition to the sailings specified in the relevant timetables, the successful tenderer will be required to respond to certain unscheduled special events, which temporarily create higher levels of demand on parts of the network. Examples of events which the successful tenderer must continue to cater for, as a prescribed minimum, are set out at Annex 8.

Technical Submissions must include plans outlining how the tenderer would meet these and any other unforeseen and unscheduled commitments which crop up from time to time.

Emergency Services

3.7.9 The successful tenderer will be required co-operate with local Health, Fire and Police services and to provide emergency call outs if required. It will be for the successful tenderer to agree any terms and conditions with the relevant contracting party for any services. The successful tenderer shall provide these call-out services at a negotiated rate or in accordance with charters. Annex 12 summarises the current emergency call-out arrangements. These services should be provided on a cost recovery basis in accordance with their lifeline nature.

Technical Submissions must include a clear statement (Schedule 7) confirming that the tenderer will co-operate with local Emergency Services and that call out services will be provided on a cost recovery basis.

3.8 Fares Structure

3.8.1 The maximum net fares levels (i.e. excluding berthing and harbour dues) for the CHFS services will be set at the levels in the most recent timetables and fares adjusted by up to a maximum of CPI (Consumer Price Index) on an annual basis ( see escalation arrangements below). The maximum gross fare that may be charged will be the net fare plus the actual berthing and harbour due element charged by the relevant Harbour authorities. The Technical Submission must contain a clear statement ( Schedule 7) confirming that fare levels will be so set.

3.8.2 Tenderers should note that berthing and harbour dues are a matter for the relevant Harbour Authority and that Scottish Ministers have no locus to intervene ¹⁶. Therefore, adjustments to gross fares (including harbour dues) may be lower or higher than CPI. The current timetables include the amount of pier dues and the successful tenderer must ensure that fares will continue to be transparent to users in this regard. As set out at paragraph 3.5.3 above it will be for tenderers to negotiate with Harbour Authorities for the use of the port facilities.

3.8.3 In the case of services running to and from harbours currently owned by CalMac (and in future owned by the VesCo) the fares shown in the existing timetables do not currently specify a berthing and harbour due element. This reflects the fact that, to date, CalMac has owned and operated these harbours itself. In future VesCo will require to charge the successful tenderer for berthing and harbour dues. Tenderers will require to establish harbour and berthing dues with VesCo in respect of their proposed services and to reflect the cost of these in their subsidy bid in order to ensure equivalent gross fares for these routes (adjusted by CPI) at the contract handover and up until the first annual review when the normal escalation arrangements in relation to net fares will apply. This is to ensure that fares to passengers do not rise as a result of the different funding flows. The same terms and conditions will be provided to all tenderers. VesCo will have responsibility for any future changes in the level of berthing and harbour dues at ports where it is the Harbour Authority. Fares for routes using VesCo ports will be subject to the same discipline after the contract handover as all other fares with any increases in harbour dues being transparent to users.

3.8.4 Details of validity rules and fares for each route are detailed in the timetables ( see Annexes 6 and 7) and Table of Rates, Fares and Charges ( see Annexes 9 and 10).

3.8.5 The successful tenderer shall offer the range of fares options for passengers and vehicles as currently set out in timetables in relation to the following:

• Single/return
• Saver 5-day return
• 6/10 journey
• Day savers
• Savers fares on specified routes (see timetables at Annexes 6 and 7 for details)

3.8.6 These vary slightly from route to route. Maximum fares based on the most recent summer and winter timetables are set out in Annexes 6 and 7. The successful tenderer shall honour all types of ticket (including annual and quarterly season tickets) sold by the current operator during the transition period.

3.8.7 The Technical Submission must include a clear statement ( Schedule 7) confirming that, if successful, the tenderer will provide the full range of fares set out in the Table of Rates And Fares and will honour all types of ticket sold by the current operator during the transition period.

3.8.8 Tenderers will wish to note that the pricing plan and maximum tariffs at the beginning of the contract must be agreed with the Executive and published in line with the requirements set out at paragraph 3.10.5 below (requirements for publishing timetables etc).

Escalation Arrangements

3.8.9 The prescribed fares may be adjusted annually on Good Friday during the contract period. The net portion of the fare (i.e. excluding berthing and harbour dues) may be increased to reflect movements in the CPI during the preceding 12 months. This will be the maximum increase allowed.

3.8.10 Fares proposals for the following year must be notified to Ministers at least three months before the operator's print date. Ministers' approval is required in all circumstances. The fare proposals should detail both the net and gross (detailing the berthing and harbour dues element separately) fares. In the event that Ministers wish to vary fares proposals then this would constitute a material change (provided the successful tenderer's proposals for net fares increase do not amount to more than CPI on any route).

3.8.11 Fares must be published annually in November. As a minimum the fares should be set out in timetables, published on the successful tenderer's website and available on ships, in port offices and in waiting rooms.

3.8.12 Technical submissions should include a clear statement ( Schedule 7) confirming that the tenderer accepts the requirements relating to fare increases and set out in detail how they intend to comply with the requirements.

Concessionary Fares

3.8.13 Annex 10 also sets out details of concessionary fares arrangements which the successful tenderer is required to offer under this contract. There are currently concessionary arrangements for:

• children
• former British Rail and Scottish Transport Group Employees
• CalMac staff (including retired employees)
• disabled people
• island residents

3.8.14 The successful tenderer will be required to continue the existing preferential tariffs for the specified users and the Technical Submission ( Schedule 7) should include a clear statement to this effect.

3.8.15 In addition to the concessions referred to in paragraph 3.8.13, there are concessionary fares schemes funded by local authorities. Initiatives such as free local off-peak travel for elderly and disabled people and the National Blind Scheme are delivered through these schemes and the successful tenderer reimbursed by the local authority. Full details are available in the information room. The Technical Submission should include a clear statement ( Schedule 7) confirming that, if successful, the tenderer will continue these arrangements. Tenderers should note that the Scottish Executive introduced measures to equalise age eligibility for concessionary travel at age 60 from April 2003.

3.8.16 The Executive is also committed to progressively introducing a scheme of national bus, rail and ferry concessionary travel for young people, initially for all in full time education or training, and the introduction of a national off-peak bus scheme for elderly and disabled people. (It should be noted that the existing free local off-peak travel for elderly and disabled people initiative currently extends to ferry travel in certain areas of the country and that the introduction of a national scheme may therefore have implications for ferry travel). The Executive's commitments to extend concessionary travel will not form part of the minimum standard at the outset. As the schemes are rolled out, this will be dealt with by a service revision under Change Mechanism procedures. The successful tenderer will be required to participate in any concessionary travel scheme that the Scottish Executive implements and the Technical Submission ( Schedule 7) should include a clear statement to this effect.

Special Charging Arrangements

3.8.17 Annexes 9 and 10 also detail special charging arrangements for:

• Residential Caravans
• Tracked Vehicles
• Bicycles
• Caravans
• Coaches
• Motor Cycle and Side Car/Tricycles
• Canoes
• Commercial Vehicles
• Unaccompanied Cars
• Dinghies
• Excess Luggage
• Hearses/Remains
• Ambulance
• Towed Horse Boxes
• Towed Vehicles
• Casualty Animals
• Motor Homes
• Left Luggage
• Hay and Straw
• Parcel and loose freight (Clyde area and Hebrides) and livestock rates (Hebrides)
• There is also a Traders Rebate Scheme based on volume and commitment to the route. This must be continued and be available to all hauliers. Full details of the Scheme are available in the information room.

3.8.18 The successful tenderer shall continue these special charging arrangements and parcel / freight / livestock rates. The Technical Submission should include a clear statement ( Schedule 7) confirming that, if successful, the tenderer accepts this requirement. The successful tenderer may not raise fares above the maxima set for each fare type and each route except by prior agreement with the Executive through the escalation arrangements. The successful tenderer does, however, have the discretion to reduce net fares.

Provision Above the Minimum Level of Service

3.8.19 The regulation of net fares, as set out in this specification, does not extend to any additional routes or services that the successful tenderer may provide which are outwith the approved services for CHFS (i.e. the services listed at Annex 1 and above).

3.8.20 This specification represents the minimum standard required. However, tenderers are encouraged to be responsive to ferry users and may wish to consider representations made, during consultation, by users in respect of fares ( see Annex 11).

3.9 Brand and Marketing

3.9.1 The successful tenderer will be required to operate CHFS services under the brand name Caledonian MacBrayne and to use the Caledonian MacBrayne trademark, logo and livery on all VesCo vessels, marketing materials, websites, signposts, letterheads, etc. relating to, or serving, the CHFS network for the duration of the contract. The successful tenderer shall not use the CalMac trademark, logo livery or name for any purpose other than operating the CHFS network. Once the CHFS contract has expired, the successful tenderer will be required to cease using the brand (etc.) and return it fully to VesCo. The Technical Submission should include a statement ( Schedule 7) confirming that, if successful, the tenderer will comply with this requirement and confirming that licensing arrangements have been agreed with VesCo.

3.9.2 With approval, the successful tenderer may be permitted to adopt a subtle endorsed branding strategy on ship and shore side facilities and marketing materials, thereby indicating that the VesCo vessels in service are being operated by the successful tenderer for the duration of the CHFS contract. If tenderers wish to take this approach initial proposals should be detailed in the Technical Submission.

3.9.3 The successful tenderer will be fully responsible for the cost of applying such endorsed branding at the commencement of the contract and the return of facilities and marketing literature to their original condition at the end of the contract. Where the successful tenderer brings his own vessels to provide services over and above the prescribed minimum approved services, or to provide temporary emergency fleet relief, these would not be required to sail under CalMac livery.

3.10 Ticketing, Information and Integrated Transport

Availability of Tickets and Information

3.10.1 The successful tenderer will be required to create one common timetable, ticketing and fares database for all routes so that all possible reservations, sales and credit card payments can be made from at least the same locations as are available now although this need not necessarily involve the use of existing offices ( see Annex 13). Tenderers will wish to note that in addition to the availability of tickets at port offices, on vessels and on-line the current operator also has commercial arrangements in place with travel agencies in the UK and abroad.

3.10.2 The successful tenderer shall operate a central information and reservations phone system for the CHFS network for the duration of the Contract.

3.10.3 The successful tenderer shall maintain, for the duration of the contract, a detailed Internet website covering their operations on the CHFS network. The page must provide links to on-line information and reservation services, CHFS seasonal timetables, a help-desk facility and an early warning Notice Board to flag any disruptions and changes to services caused by bad weather etc.

3.10.4 The successful tenderer will be required to provide real time information to passengers (through the website, the central information system, on vessels and in port offices and waiting rooms) and to road and public transport information systems (e.g. Traveline) for travellers to and from the CHFS network.

Brochure and Timetables

3.10.5 The successful tenderer shall produce and market a brochure covering all CHFS routes. Following consultation with users, the successful tenderer will be required to publish summer and winter timetables annually. These should be published no later than November for the following summer and July for the winter. If changes are being proposed i.e. if the successful tenderer is seeking an "Approved Service Revision" then plans must be submitted (along with details of consultation on these) to the Executive no later than three months before the successful tenderer's copy date.

3.10.6 The brochure must advertise timetables and booking information for all CHFS routes. For the convenience of users, the brochure must also include, as a minimum, timetables for other ferry services provided by local authorities and private operators in the Clyde and Hebrides. No charge should be made to other operators for this. Competing services do not have to be advertised. The successful tenderer is also expected to work closely with local tourist boards and to co-operate as far as possible to meet timescales and participate in local initiatives. In particular the successful tenderer should permit other operators or other organisations to advertise CHFS timetables.

3.10.7 In line with the Scottish Executive commitment to meet integrated transport objectives, the successful tenderer is required, when publishing or advertising their CHFS timetable, to supply additional timetable information for connecting public transport services (for example, bus and rail services).

Other Transport Operators

3.10.8 The successful tenderer is expected to work closely with and build partnerships with rail and local bus operators and other ferry operators to achieve integrated timetables. The successful tenderer should meet with the rail and bus operators periodically. In the event services are delayed the successful tenderer should liaise with rail and bus operators to agree contingency arrangements. Tenderers are generally encouraged to work with other transport providers in relation to integrated ticketing initiatives. The contract will require the successful tenderer to participate fully in any integrated ticketing initiatives which are judged by the Scottish Ministers to benefit the public. We do not expect the ongoing administrative costs of participation to be significant and we would therefore expect the successful tenderer to meet those costs which it directly incurs. Reasonable start up/capital costs associated with participation will be met by the Executive.

3.10.9 The successful tenderer is also expected to work closely with the operator of the Gourock-Dunoon ferry service (currently operated by Caledonian MacBrayne and being tendered separately) to facilitate integrated services and to participate in marketing initiatives in respect of the Clyde and Hebrides.

Traveline and Transport Direct

3.10.10 Traveline is a UK national, impartial and multi-modal public transport information system. It provides a telephone and internet enquiry service providing timetable and journey planning information. It aims to allow the traveller to make informed choices and encourages public transport. Traveline provides information about journey itineraries, routes, service numbers, timetables and pre-planned alterations to most public transport modes. The successful tenderer will be required to join Traveline Scotland ¹⁷ and collaborate fully in the Traveline initiative. The successful tenderer shall also include the Traveline contact details on all timetable literature and advertising. The design and use of its marketing material is provided free to participating transport operators.

3.10.11 In the longer term, it is intended that Transport Direct will build on the Traveline service provision. Transport Direct aims to provide the traveller with all the information they need before and during a journey anywhere in the UK and with the ability to buy the associated ticket. It will ultimately cover travel by all modes i.e. air, car, train, taxi, tram, tube, bus, coach, ferry, bicycle, foot and, most importantly, combinations of these modes. The successful tenderer will also be required to participate fully in Transport Direct as it is developed.

3.10.12 This is a minimum requirement. The Executive expects that the successful tenderer will provide ferry services which, to the best extent possible, fit with the Executive's wider integrated transport policies. For example, it is hoped that the successful tenderer will encourage intermodal transfer, wherever possible, at the mainland and on the islands and remote peninsulas in line with the Executive's transport philosophy. Tenderers should consider ways of promoting improved public transport linkages both within the CHFS network and between the ferries and other modes of public transport in the Clyde & Hebrides.

3.10.13 Tenderers will note that the performance regime allows, as relief events, for delays in services in order to facilitate integrated transport.

3.10.14 The Technical Submission should include a clear statement ( Schedule 7) confirming that, if successful, the tenderer will comply with the requirements of this section and the Bid should include detailed proposals setting out how the tenderer would meet the requirements of this section.

3.11 Disabled People

3.11.1 The successful tenderer will be required to have regard to the legislative framework and obligations in relation to disabled people and to consider the needs of disabled travellers ¹⁸. This will include consideration of the needs of visually and hearing impaired people. The successful tenderer will also be required to have regard to the Minimum Standards for Staff

Assisting Disabled People and Value for Anyone, Value for Everyone - both published by the Mobility and Access Committee for Scotland (MACS). The successful tenderer will be required to put in place a service level agreement for disabled passengers, and to set out in the Users' Charter future plans for improvements. Tenderers must include, as part of their technical submission, a clear statement ( Schedule 7) confirming that in providing the services they will consider the needs of disabled travellers, and detailed proposals setting out how they intend to satisfy this requirement.

3.11.2 The successful tenderer must take into account the needs of disabled people when providing information, timetables and booking reservation systems and in allowing time for intermodal transfer where timetable variations are being proposed.

3.11.3 Tenderers will wish to note that currently during short crossings (30 minutes or less) disabled people are usually allowed to stay in their vehicles, where all vehicles are stowed on an open deck, in accordance with provisions agreed between the current operator and the MCA (see Marine Guidance Note (MGN) 19 paragraph 3.1.4). Where this is safe this practice should continue. This does not affect the ship-master's freedom, in the interests of safety, to require all passengers to remain inside or get out of, their vehicles.

3.11.4 For those passengers with visual impairment, the successful tenderer is encouraged to comply with the guidance on travel issued by the Guide Dogs for the Blind Association.

3.11.5 The current operator meets regularly with the Mobility and Access Committee for Scotland (MACS) and the successful tenderer will be expected to continue this practice.

3.12 Network-wide Products

3.12.1 Tenderers must consider the provision of network-wide initiatives i.e.:

• Island Hopscotch (tickets)
• Rover (tickets)

3.12.2 These are marketing initiatives to facilitate tourism throughout the Clyde and Hebrides and are described at Annexes 6 and 7. The precise format will not form part of the minimum standard, since tenderers may be able to bring forward innovative ideas and improve on the current arrangements. However, the Executive will require the successful tenderer, as part of the prescribed minimum standard, to make available comparable products to foster tourism, which is a key issue for the economic wellbeing of the Highlands and Islands. The Technical Submission should include details of the comparable products which the Tender would make available.

3.13 Language

3.13.1 The successful tenderer shall ensure that crews are able to communicate with passengers and each other in English (the principal language of the passengers carried) to meet the requirements of the International Safety Management (ISM) Code and of STCW 95 (Standards of Training, Watchkeeping and Certification Convention and Code 1995). The successful tenderer shall particularly ensure that crew and shore staff who deal directly with users of the services are proficient in English. The Technical Submission should include clear statements confirming that the tenderer will, if successful, comply with these requirements and set out how the tenderer would propose to fulfil these requirements.

3.13.2 VesCo vessels are UK registered and it follows that the working language of the ships is English. It is confirmed that the present crew fulfil this requirement.

3.13.3 While Scottish Ministers do not prescribe proficiency in Gaelic in respect of crews or shore staff employed to operate the CHFS network, tenderers' initiatives to enhance and promote the language, culture, enterprise and tourist facilities available throughout the Highlands & Islands would be welcomed. It is the Executive's view that some provision for competent Gaelic speakers on the Hebridean routes especially would be welcomed.

Technical Submissions should include tenderer's consideration of this issue.

3.13.4 The Executive wishes tenderers to consider whether there are benefits attached to ensuring a number of sea-going or shore-based jobs for competent Gaelic speakers for the purposes of dealing effectively with CHFS customers as well as acting as a source of local expertise on the area's geography, culture, history and tourist information. It is suggested that, as a minimum, the successful tenderer could ensure that there is at least one Gaelic speaking crew member on the relevant routes. Technical Submissions should include tenderer's consideration of this issue.

3.13.5 The successful tenderer shall retain the bi-lingual (Gaelic and English) taped "Welcome" announcements currently provided on seven CHFS routes serving the Hebrides. These routes are listed in Annex 19. In addition, the successful tenderer shall provide bilingual (Gaelic and English) literature and signage in passenger areas of vessels serving the routes specified in Annex 19 and shall continue the current practice of displaying ships names in both Gaelic and English. The Technical Submission should include clear statements ( Schedule 7) confirming that the tenderer will, if successful, comply with these requirements.

3.14 Consultation with Users

3.14.1 The contract award will be conditional upon terms which require regular consultation with user groups and stakeholders. The Executive must be satisfied that suitable arrangements will be put in place for full and fair consultation and will expect relevant local authorities, ferry user groups and representatives of key Clyde-based and Highland & Island agencies to be among the bodies consulted. See further details below.

3.14.2 The successful tenderer shall consult with ferry users on seasonal timetables and other issues which have a direct impact on ferry services to particular communities. The successful tenderer shall engage in this process through the formal consultation channels described below. Consultation on timetables must fit in with the requirements for publishing and for seeking approval from Ministers for changes to the Approved Services. Technical Submissions should include a clear statement ( Schedule 7) that the tenderer will, if successful, comply with the Executive's requirements in relation to consultation with users.

Current arrangements

3.14.3 At present the Caledonian MacBrayne Users Committee (CMUC) is the statutory body set up to represent customers' interests. The CMUC has the same membership as the Rail Passengers' Committee for Scotland and reports directly to the Minister. In addition there are three Shipping Services Advisory Committees within the CHFS area, covering Clyde and Hebrides ferry services.

New Consultative Arrangements - The Scottish Ferry Committee

3.14.4 Following a review of the consultative arrangements new arrangements have been announced and these will be in place by contract handover. A new two-tier structure will address the need for effective consultative mechanisms covering all ferry services provided under the Executive's powers, separating strategic issues from local service delivery. A new Scottish Ferry Committee (SFC) with a wide-ranging membership will consider strategic interests. New and separate Shipping Services Advisory Committees for Orkney and Shetland will consider relevant local ferry issues. The 3 existing Shipping Services Advisory Committees (covering the Clyde, the Hebridean Isles North and Hebridean Isles South) will continue to consider local Clyde and Hebridean Isles ferry issues. The Rail Passengers Committee (Scotland) will cease to consider ferry matters, in effect ceasing the role of the Caledonian MacBrayne Users' Committee (CMUC).

3.14.5 The 5 SSACs will consider local ferry operational issues and investigate local users' complaints about service delivery issues, as presently dealt with by the CMUC. Ministers value the contribution that local community organisations, such as island ferry committees, can make in expressing the views of local businesses and residents and the SSACs will be expected to consult them and take their views into account. The new-style SSACs and the SFC will come into operation in 2005. The SFC will concentrate on strategic issues such as route configurations and fares structures, comments to Ministers on research projects, route development issues and consider strategic or unresolved complaints referred to it by SSACs. Ministers would consider any customer complaints unresolved at SFC level. Membership of the SSACs will continue to reflect local users and interested parties. Membership of the SFC will include representation from the SSACs, local authorities in areas served by ferry services supported by Scottish Ministers, national bodies with an interest in ferry operations and representatives of other users. Ministers intend that there should be reasonable balance between the varying interests, such as business and community representations and those with specialist knowledge.

3.14.6 The successful tenderer is required to:

• take into account comments by the 3 SSAC relevant to this contract
• act reasonably in reaching decisions in relation to the right balance of provision between different interests and areas of the network, and
• provide adequate explanation for the successful tenderer's actions to the SSACs where comment or clarification has been requested

3.14.7 The Executive requires that the successful tenderer meets the SSAC in each area at least twice per year and that minutes of the meetings are provided to Scottish Ministers. The agenda for these meetings must cover local/regional service issues and port specific matters. Examples are timetabling for winter/summer services, on-board services and facilities at terminals. The Executive will set out in an operational letter to the successful tenderer key criteria for how the successful tenderer will enter into the consultative process. Technical submissions should include a clear statement ( Schedule 7) confirming that the tenderer accepts the requirements in relation to consultation with users.

3.14.8 The successful tenderer shall meet these consultative requirements as a minimum but is invited to consider how this on-going consultation with ferry users might be improved for the contract period.

3.15 Performance Regime and Users' Charter

3.15.1 The performance regime will monitor the reliability and punctuality of the services. Monitoring will normally be on a rolling four-week basis to enable any problems to be picked up and dealt with early (although cancellations must be notified immediately). The regime uses a mix of reduction in subsidy and, for more serious defaults, the dispute resolution procedure, which may result in termination of contract. It should be noted that the regime provides for cancellations and delays due to relief events such as poor weather conditions. It also allows for "knock on'' effects of a delayed sailing due to relief events on other sailings. This ensures that safety should never be compromised to avoid penalties. Annex 20 sets out the detail of the regime and Annex 21 sets out the relief events which will be acceptable to the Executive.

3.15.2 Monthly performance figures must be made publicly available by the successful tenderer and displayed in port offices, on board vessels and on the website. The Technical Submission should include a clear statement ( Schedule 7) confirming that, if successful, the tenderer will comply with this requirement and setting out how this requirement would be fulfilled. The successful tenderer shall also be subject to audit by the Executive (or the Executive's appointed auditors) and this may include spot checks.

3.15.3 The Technical Submission should include a draft Users Charter devised by the tenderer. It should cover issues such as on-board facilities, cleanliness, staff conduct, services for disabled people and the way in which complaints are to be dealt with. The successful tenderer will be expected to publish the Users Charter and to abide by the standards which it sets. The Charter will be subject to the approval of the Executive.

3.15.4 Tenderers will wish to note that the SSACs deal with local complaints. The Scottish Ferry Committee will have a role as conciliator in the event that complaints cannot be resolved between the ferry users and the successful tenderer. It can make recommendations to the successful tenderer.

3.16 Monitoring of Operations

3.16.1 The Executive will monitor the successful tenderer's performance against the requirements of the specification and the successful tenderer's other obligations under the contract. The Executive will conduct whatever audits it feels are required. The Technical Submission should contain a clear statement confirming that, if successful, the tenderer will co-operate in these arrangements and provide accurate auditable information to the Executive. This will enable such audits to be carried out to the Executive's required standards.

3.17 Information Required from the Successful Tenderer over the Course of the Six

Year Contract

3.17.1 The successful tenderer will be required to provide regular detailed information about the operation of the services. This information is required for internal audit purposes, to comply with EU rules relating to the Transparency Directive, Cabotage Regulations, etc., to inform Parliament, and to inform the Executive and other tenderers in the next competition. The information requirements are set out at Annexes 20 and 23. The Technical Submission should include a clear statement ( Schedule 7) confirming that the tenderer, if successful, would comply with the information requirements and set out how the tenderer would ensure accurate, reliable and timeous information provision. Tenderers should also note that, if successful, they would also be required to comply with any other legislative requirements for information.

3.18 Safety

3.18.1 The safety of passengers and crew must not be compromised or diluted. Accordingly, it is a requirement that the CHFS services are managed and operated in a manner that consistently provides the highest standards of safety. The successful tenderer shall, therefore, ensure compliance with all applicable International Conventions, EU Council Directives and Regulations, and National Regulations and ensure that relevant industry codes, guidance and standards are fully taken into account. In particular, the successful tenderer shall comply with all Merchant Shipping Legislation enforced by the MCA, and shall ensure that the vessels to be used on the CHFS network, and all matters concerning their operation, comply with relevant UK and EU legislation for passenger Ro-Ro ships (EU(B), Class IIA, and Classes III to VIA as appropriate). Both ships and the successful tenderer must comply with the requirements of the ISM Code rather than the Domestic Small Passenger Ship Code. The Technical Submission must include a clear statement confirming that, if successful, the tenderer would meet the requirements of this paragraph and setting out how the tenderer would achieve this.

3.18.2 The Executive requires tenderers to demonstrate how they will meet all relevant safety requirements for vessel specification and operations, and in relation to crew and passenger safety on board.

3.18.3 In carrying out all duties relating to shore side activities, the successful tenderer shall comply with all relevant rules and regulations, including Health and Safety Regulations and the Port Marine Safety Code as applicable. The Technical Submission must include a clear statement confirming that, if successful, the tenderer would meet the requirements of this paragraph and setting out how the tenderer would achieve this.

3.18.4 In the event that the contract is terminated or there is a breakdown in the contract, all Ship Safety Management Systems and safety documentation relating to CHFS services must be made available to VesCo in order that the Operator of Last Resort function can be triggered quickly and in line with MCA requirements. The Technical Submission must contain a clear statement confirming that this information will be provided should it be required. Tenderers will wish to note that, if successful, procedures will be put in place to ensure that VesCo detailed knowledge of the operator's systems is updated as necessary.

3.19 Environmental Protection

3.19.1 The CHFS network is in an area of outstanding natural beauty, and wildlife, fish farming and tourism are important to local communities. Accordingly the Technical Submission should set out how the Safety and Environmental Protection policy will recognise and take into account this environmental sensitivity.

3.19.2 In order to protect the environment, the successful tenderer will be expected to develop the objectives of their Safety Management Systems, as required by the ISM Code, in consideration of the unique and special environmental factors that exist in and around the vessels' trading areas. The Technical Submission should set out how the tenderer, if successful, would do this.

3.19.3 VesCo will have regard to environmental issues in relation to its harbour management agreement and vessel leasing arrangements.

3.20 Contract Handover/Implementation Plan

3.20.1 The Technical Submission should include detailed proposals setting out how the tenderer would approach contract handover. This should include an implementation plan and a timetable with key milestones. Tenderers should note that the agreed implementation plan will form part of the subsidy contract and that failure to complete implementation to a satisfactory standard may result in a breach of contract.

3.20.2 The Executive will have the right to monitor the successful tenderer's progress on service implementation against the agreed implementation plan. The successful tenderer will be required to provide monthly reports to the Executive and attend progress meetings as required during the period between contract award and service commencement. Where progress on implementation falls behind the requirements of the plan the successful tenderer will be required to produce proposals for rectifying this and to immediately take such action as may be required to address the problem.

3.20.3 Tenderers will wish to note that the current operator will cooperate fully with all reasonable requests during the handover/implementation period.

3.20.4 The successful tenderer will be required to cooperate fully with all reasonable requests if and when another operator is appointed to take over the CHFS services (e.g. for the next subsidy contract). Full details are set out in the terms and conditions.

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