VICTORIA: The Canadian Taxpayers Federation (CTF) today reacted to the provincial announcement that the BC Ferry Crown Corporation will be transformed into an independent company. The CTF applauds the new governance structure that allows for market reforms, minimizes political meddling and insulates taxpayers from new public debt and risk.

"The restructuring toward the new BC Ferry Authority accommodates many of the advantages of a wholesale privatization without selling off the shares to a private company," noted Victor Vrsnik, BC Director for the CTF. "The new BC Ferry Authority is contractually bound to maintain existing routes but will have the flexibility to save costs by contracting-out those routes to a private sector company through a tendering process."

"BC Ferries Authority should steer the direction of ferry services without having to do the paddling. Private sector ferry services should have the opportunity to bid on the rights to all ferry routes in the province," recommended Vrsnik.

Unencumbered by political interference, the CTF believes that the new BC Ferry Services can move toward a user pay model where routes become financially self-sufficient and are able to operate without cross-subsidies from ferry riders on profitable runs.

A CTF Freedom of Information request found that only three profitable ferry routes subsidized 23 money-losing routes in 2001.

"The current operating model of the BC Ferry Crown Corporation unfairly over-charges passengers on profitable runs to subsidize money-losing routes. Each ticket should be priced to reflect the true cost of the service provided without cross-subsides," recommended Vrsnik.

The CTF recommends that the province slowly phase out subsidies supplied by provincial motor fuel taxes to remote routes in British Columbia. 'BC taxpayers that never use the ferry system should not be obliged to subsidize transportation services to the tune of $71 million per year," said Vrsnik.