Island Resilience Fund 2026-27: Island Communities Impact Assessment

4. Assessment

The Islands (Scotland) Act 2018 places a duty on relevant authorities to consider whether a policy, strategy or service is likely to have an effect on an island community which is significantly different from its effect on other communities in Scotland.

The evidence gathered during the development of the Islands Resilience Fund demonstrates that island communities continue to experience impacts arising from ferry disruption which are materially different from those experienced by mainland communities. These impacts are both economic and social in nature and reflect the reliance of many islands on ferry services as essential infrastructure for the movement of people, goods and services.

The independent evaluation of the Islands Business Resilience Fund found that ferry disruption has resulted in reduced visitor numbers, increased operating costs, supply chain disruption and reduced business confidence across many island communities. It also found that the impacts extend beyond individual businesses and affect wider community resilience, particularly in relation to workforce retention, access to services and the sustainability of local economies.

Stakeholder engagement undertaken during both 2025 and 2026 reinforced these findings. Participants highlighted the unique challenges faced by island communities where ferry services represent a critical connection to employment, healthcare, education, supply chains and essential services. Stakeholders described circumstances where disruption affected the movement of livestock, food supplies, construction materials, community services, healthcare appointments and access to specialist contractors. Participants also highlighted wider impacts on community sustainability and population retention.

Unlike many mainland communities, island communities often have limited alternative transport options. Where disruption occurs, individuals, businesses and community organisations may face significantly higher costs, longer delays and fewer alternative routes. A number of stakeholders noted that disruption can have cumulative effects across entire island economies, affecting tourism, fisheries, aquaculture, haulage, agriculture, retail, cultural organisations and community services simultaneously.

The evidence also demonstrates that impacts differ between island communities themselves. Ferry network disruption has not been experienced uniformly across Scotland's islands. Previous analysis identified differing levels of disruption across routes and islands, with some communities facing sustained cancellation rates, while others experienced significant capacity constraints and reduced service reliability.

The engagement process also highlighted that island economies are characterised by features which are less common elsewhere in Scotland, including portfolio livelihoods, seasonal employment, reliance on visitor economies, volunteer-led organisations and community-owned enterprises. Stakeholders highlighted that these characteristics can increase vulnerability to transport disruption whilst also making it more difficult for some organisations to access traditional forms of support.

Is a full Island Communities Impact Assessment required?

On the basis of the available evidence, the Scottish Government considers that the effects of ferry disruption on island communities are significantly different from those experienced by other communities in Scotland. Furthermore, the impacts vary significantly between island communities depending on their connectivity, geography and exposure to disruption. The Islands Resilience Fund has been developed specifically in recognition of these differential impacts and is intended to mitigate some of the economic and community consequences arising from sustained ferry disruption.

The Scottish Government therefore concludes that the policy is likely to have a significantly different effect on island communities and that a full Island Communities Impact Assessment is required.