If anyone suggested that taxpayers should pay for a new $82 million highway every year to a remote location - say, the top of a different mountain where someone wanted to build a chalet for their family and friends, most people might think such a request ludicrous. Funny then, that many ferry riders are expected to annually pay above-cost fares on some heavily-traveled routes, dollars that are then used to heavily cross-subsidize riders on smaller routes that pay below-cost fares.

According to the just released Fred Wright report on BC Ferries, the Tsawwassen/Swartz Bay route turned a profit of almost $36 million dollars last year once all expense and revenue factors are accounted for, as did the Horseshoe Bay/Nanaimo run, which made $3.7 million. All the other routes lost a collective total of over $82 million. (These figures differ marginally from the information released to the Canadian Taxpayers Federation by BC Ferries under a Freedom of Information request. The Wright report includes capital expenses, insurance, and terminal operations among other items.)

The government-commissioned Wright report raises many excellent questions about ferry service in British Columbia, but the cross-subsidization issue is worth looking at in isolation and here's why: things could remain exactly as they are - BC Ferries could stay completely government-owned, unions could continue to run the system as they like, and current outside taxpayer subsidies could continue to flow - and status quo supporters must still justify why some patrons deserve a tremendous discount at the expense of others.

As Wright points out, "BC Ferries offers commuter discounts of 21% to 52% on 18 of its 26 routes. None of these routes generate a positive route contribution. On ten of these routes, revenues are insufficient to cover even the vessel labour costs and on another three routes, revenues are insufficient to cover labour and fuel costs."

Naturally, those who pay less than the full cost of a service like it that way. Hey - who wouldn't For example, in the southern Gulf Islands, six vessels and ten terminals serve five island communities with a combined population of 15,000. Those routes lose over $20 million annually or $1,333 per capita. The per passenger/ per trip subsidy on the Swartz Bay/Outer Gulf Islands trip is $22.41. Up north, the Discovery Coast subsidy per passenger/per trip is a whopping $310.70!

The oft-heard justification is that ferry service is akin to having the taxpayer purse for public highways. Try again: Taxpayers don't rip up and re-pave the same highway to the tune of $82 million every year, in effect what happens with the money-losing routes operated by BC Ferries. But regardless, the debate over how much (if any) money taxpayers should send to BC Ferries, is completely separate from the issue of why riders on the main ferry routes must pay above-cost ticket prices while others receive discounts of up to 52%.

One critic of the report already remarked that those who live on isolated islands like the remoteness and don't want bridges to disrupt that. Fine, but why then must other ferry riders in the system pay cost-plus fares to subsidize those who wish to live in splendid isolation Why should a Surrey family who travels from Horseshoe Bay to meet relatives in Nanaimo or Victoria (or vice-verse), subsidize someone who wants to live full-time on a small island
MLAs in other parts of the province - and taxpayers and ferry riders everywhere - should make this much clear to their colleagues who represent such areas and the predictable special interests that want continued cross-subsidization: forget the unequal subsidy, or accept fewer runs, or build a bridge.