Caribou-Wood Islands Ferry Service Future Secured

Premier's Office

March 22, 2005 3:55 PM

A new agreement will allow Northumberland Ferries to maintain a
two-ship operation and its traditional level of service between
Caribou, N.S., and Wood Islands, P.E.I.

Premier John Hamm said he is pleased with the announcement made
today, March 23, by the federal government. Through an agreement
in principle, ferry service subsidies will be maintained and, in
fact, increased through to 2010 at the province's second-busiest
point of entry for vehicles.

"This is good news for our tourism and economic development
efforts in the Pictou County area and in our province as a
whole," Premier Hamm said. "I am glad the federal government
realizes the current level of service provided through
Northumberland Ferries is not something that can be reduced
without seriously harming our province and Prince Edward Island
economically."

The funding will cover operational and maintenance costs, and
discussions will be held on ways to minimize and control
operating losses. As well, Transport Canada will continue to be
responsible for undertaking major repairs and capital
investments, such as dry-docking, dredging and major terminal
repairs.

The premier thanked officials at Transport Canada and others
involved for responding positively to the concerns of both Nova
Scotia and Prince Edward Island so swiftly. He also credited a
strong lobby from residents, the business community, and the
local tourism industries in both Nova Scotia and Prince Edward
Island, along with pleas from representatives at all levels of
government, with bringing a quick end to Transport Canada's
suggestions for severe cuts to the service.

"It's a nice way to kick off spring. Transport Canada's plans for
reductions in subsidies to the service had sent a chill through
both our business and tourism communities," said the premier.

The current subsidy for the service is due to expire at the end
of March. Reports had suggested that the reduction in funding
would result in a service cut of almost two months and perhaps
lead eventually to the loss of one of the two ferries.

"Such an uncompetitive service would surely have led to a
complete abandonment of this historic ferry service by both users
and our federal government," the premier said.

In a letter sent to the Prime Minister Paul Martin earlier in
March, Premier Hamm noted that the Nova Scotia-Prince Edward
Island service has proven that it remains a popular alternative
for a variety of reasons since the fixed link opened in 1999. He
added that the Confederation Bridge was constructed to replace
the former service between the Island and New Brunswick, not the
Nova Scotia to P.E.I. link.


FOR BROADCAST USE:

     Premier John Hamm says he is pleased Transport Canada has

signalled its renewed support for the ferry service between Nova

Scotia and P-E-I.

     The federal government announced today (March 22nd) that it

has signed an agreement in principle that furthers its current

financial support until 2010 for the Caribou to Wood Islands

ferry.

     In a letter to Prime Minister Paul Martin earlier in March,

the premier said any reduction would have a serious, negative

impact on tourism and business in eastern Nova Scotia.

     With an end of March deadline looming, reports from Ottawa

had suggested that the reduction in funding would result in a

service cut of almost two months and perhaps would eventually

lead to the loss of one of the two ferries.

     Premier Hamm thanked the local business and tourism

communities along with residents and elected officials at all

levels in both provinces for voicing their concern and helping to

save what is the second busiest point of entry for vehicles in

the province.

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Contact: Hugh Fraser
         Premier's Office
         902-424-4092
         E-mail: fraserhu@gov.ns.ca