Gov’t disputes’ Steam Packet dispute

The Cabinet office says sea travel figures - provided in last month’s Inflation report are correct - following a dispute from the Steam Packet.

According to the July Report, inflation as measured by Consumer Price Index (CPI), stands at 10.8%, up from 9.2% in June 2022 and includes a 104% increase in sea transport prices during this period.

Yesterday, the Steam Packet issue a statement in which is stated it believed the method behind the calculations was ‘misleading’, “given no product fares (excluding fuel surcharge) had increased by more than 3.1% in the 12 months to June.”

It said:

”Under the Sea Services Agreement, Standard Fares cannot increase by more than the published Manx CPI increase for August of each year.

The anomaly in the headline figures arises due to the comparison of the average price for June 2022, which reflected the high demand for TT 2022, with that of June 2021 when, due to Covid, traffic volumes were just 10% of 2022 levels. 

As a consequence, the mix of fares was not representative of normal trading nor of typical average prices.”

In response government has issued the following statement:

“The introduction to the report clearly highlights that the unusual figure is due to the data being collected during a high demand period. Recognising this, the report also states what inflation would be without transport fees.

The July inflation figure has been calculated in the same way as in previous reports, dating back to 2018. It uses a methodology that was devised in consultation with the Isle of Man Steam Packet Company, with data provided by them. 

A government spokesperson said: ‘Government firmly rejects the assertion that the method used to calculate these figures is misleading.’”