No support for firms to cover freight charge rise

The Isle of Man government has ruled out stepping in to help firms cover a rise in the cost of transporting goods by ferry.

A fuel surcharge levied on freight carried by the Isle of Man Steam Packet Company rose from £8.79 to £11.06 last month due to the volatility in fuel prices as a result of the Middle East conflict.

The Isle of Man Chamber of Commerce had called for the government to step in to help after a survey of firms affected showed 88% believed it would hit their profits.

Treasury Minister Chris Thomas said: "At present, we are not considering directly intervening by subsidising or otherwise directly offsetting the fuel surcharge."

He told the House of Keys that changes in the charge – which can go up or down – were allowed under the government's sea services agreement with the Steam Packet.

Lawrie Hooper MHK said the government had intervened during the Covid pandemic by altering the agreement "in respect of the fuel surcharge to take account of things like the border closure, [and] the fluctuating international markets at the time".

He questioned why similar steps were not being taken now to prevent bigger issues arising since feedback from firms was that the current situation was having an impact.

Thomas said the government "definitely have heard what the Chamber of Commerce said".

However, he said the response to Covid was much broader and involved £100m being spent from of the National Insurance Fund.

That was followed by "at least £25m" of Manx Utilities reserves being used to freeze electricity bills in 2022-23 as the wholesale price of gas soared in the wake of the war in Ukraine.

"We have to remember that this crisis could be very different from the Covid crisis, it could be going on for much longer," he said.

There were "all sorts of other responses as well as just using public funds to subsidise things now", he said, adding that general subsidies "don't necessarily achieve the purpose that we want to achieve" such as promoting energy efficiency.

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