Island Resilience Fund 2026-27: Island Communities Impact Assessment

2. What data is available and who will be affected by the Fund?

A range of quantitative and qualitative evidence has informed the development of the Islands Resilience Fund.

Previous Fund Delivery and Evaluation

The Scottish Government and Highlands and Islands Enterprise (HIE) have drawn upon evidence gathered through delivery of the Islands Business Resilience Fund (IBRF) during 2025 and 2026. The IBRF provided support to 444 businesses across 19 islands affected by ferry disruption. An independent evaluation found that ferry disruption continued to have a significant impact on island businesses, reducing visitor numbers, disrupting supply chains and increasing operating costs. The evaluation concluded that the Fund improved resilience for many recipient organisations, with 78% of survey respondents reporting improved resilience and 62% reporting that support had helped safeguard jobs and turnover. Overall, the evaluation estimated that the Fund helped safeguard approximately 666 jobs and £5.9 million in turnover.

The evaluation also identified a number of lessons for future support. These included concerns that some eligibility criteria may have excluded organisations experiencing adverse impacts, particularly smaller businesses, some voluntary organisations, fishing businesses and organisations operating across multiple sectors. Stakeholders also highlighted the importance of recognising wider resilience challenges facing island communities, including workforce retention, transport connectivity, community capacity and supply chain resilience.

Ferry Disruption Evidence

The Fund is intended to respond to the continuing effects of sustained ferry disruption experienced by some island communities. Evidence from previous rounds of funding utilised operational ferry performance data, stakeholder feedback and analysis undertaken by HIE and the Scottish Government to identify islands experiencing the greatest impacts. This evidence demonstrated significant variation in the scale and nature of disruption experienced across Scotland's islands, with some communities facing prolonged service cancellation, reduced capacity, timetable changes and constraints on the movement of goods and people.

Analysis undertaken by HIE also identified worsening disruption affecting Harris and Scalpay over the past 15 months, resulting from cancellations due to technical reasons on the Uig-Tarbert/Lochmaddy and Berneray-Leverburgh routes. This evidence has informed proposals to expand eligibility for the 2026-27 Fund.

Stakeholder Engagement

In addition to quantitative evidence, the Scottish Government undertook stakeholder engagement with island businesses, community organisations and representative bodies to better understand the ongoing impacts of ferry disruption and gather views on future support. Findings from this engagement have informed the design of the Fund and are discussed further in the Consultation and Engagement section below.

Who will be affected by the Fund?

The Fund is expected to have a direct positive impact on eligible businesses and organisations located on islands that have experienced sustained ferry disruption and meet the Fund's eligibility criteria. This includes organisations operating within previously eligible sectors as well as groups newly brought into scope through clarifying eligibility for fish catching and aquaculture businesses, extending support to hauliers and improving access for smaller volunteer-led organisations.

The Fund is also expected to have indirect positive impacts on island communities through supporting employment, maintaining local services, strengthening local supply chains and contributing to wider community resilience. Stakeholder engagement highlighted that island businesses, community organisations and residents are highly interconnected, meaning support provided to organisations can generate benefits across the wider community.

The effects of the Fund will not be uniform across all island communities. Some islands and organisations will remain ineligible because available evidence indicates that the impacts of ferry disruption have been more severe or sustained in some communities than others. The Fund therefore adopts a targeted approach in order to maximise the impact of available funding and direct support towards those island communities experiencing the greatest adverse effects.