Island business resilience fund: island communities impact assessment (December 2025)

5. Island Communities Impact Assessment

The decision to introduce an Islands Business Resilience Fund is, in itself, a mitigation for the adverse and disproportionate impacts that ferry disruption is having on some islands and some sectors. The evidence shows that some routes have experienced exceptionally high levels of cancellations, with significant economic consequences for businesses in certain sectors on those islands.

Whilst the Scottish Government acknowledges that many islands experience some level of disruption, current financial constraints mean it is not possible – or appropriate - to provide blanket funding to all island communities. The expansion allows for a greater coverage, and therefore further mitigation of the issues faced by island communities.

Delivery by HIE has been identified as the most effective and immediate method, due to their existing relationships with island businesses, their on-island presence, and their experience of delivering similar grant support in similar contexts.

Positive outcomes are expected for eligible islands and sectors, but it is acknowledged that even with expansion, some islands may still have experienced some disruption, albeit in a lesser capacity than those included within the fund.

No alternative delivery mechanisms are currently proposed, as the HIE model offers both speed and local sensitivity. However, ongoing monitoring and engagement will help us to identify whether any further interventions or adjustments are needed.

In summary, the expansion of the IBRF further mitigates the worst impacts of ferry disruption in a fair, transparent and targeted way, while acknowledging that not all affected communities can be supported through this intervention.