THE Scottish Government has been accused of playing fast and loose with ferry services as it comes under pressure to justify the legal basis for extending the Caledonian MacBrayne contract by three years.
Critics claim the deal could lead to £200 million of subsidy being paid illegally and therefore even threaten CalMac's existence.
Industry sources also believe the extension is designed to delay difficult decisions on CalMac until after the independence referendum in 2014.
Elaine Murray, Scottish Labour's transport spokeswoman, said: "It would appear the Scottish Government is playing fast and loose with the procurement regulations and if the decision to grant CalMac an untendered extension is challenged, the losers will be those who depend on these ferry services.
"The Scottish Government has a duty to those communities and to the CalMac staff to be crystal clear on whether this extension has been approved by Europe and if not, it should publish its review of ferry services and bring forward the draft CalMac tender without any further delay."
Ministers insist last month's announcement on CalMac's contract, which had been due to end next October, was to allow it to finalise the scope of the next contract now due to go out to tender in two years' time. This has been complicated by the possible inclusion of services run by councils, as well as CalMac's existing routes, which are to be kept together for tendering.
The Government is confident its actions are in line with European Law, despite subsidised contracts normally being required to go out to tender. A Transport Scotland spokesman said the European compliant Regulation of the Public Contracts (Scotland) Regulations 2012 allows a deal without competition for additional services not foreseen at the time the original contract.
But an industry source said this was "clearly trumped" by European Cabotage regulations.
He added: "If this extension goes ahead and is successfully challenged, all subsidy payments made under this extension would be repayable, thereby threatening the existence of CalMac."
Brussels has stressed a member state was not always obliged to notify it of a subsidised service as long as it met established conditions laid down in a European Court judgment, saying: "It is the member state's responsibility to assess the existence of state aid and to decide whether a notification to the Commission is necessary."
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