ALL of Scotland's £1billion-plus ferry services will be nationalised with costly and time-consuming tendering exercises binned under new plans being pursued by ministers.

New advice from the European Commission has sparked a review of the country's ferry contracts, which the Scottish Government believes could open the door to all routes being serviced by "an in-house operator".

Announcing the move in parliament, Transport Minister Humza Yousaf has already put the brakes on the ongoing procurement for one of the Scotland's busiest routes, the Gourock to Dunoon service.

Read more: Serco threaten to sue Glasgow City Council over £400m procurement concerns

The review will also consider the potential implications for the Northern Isles services, which are currently operated by controversial global services giant Serco.

Serco recently lost out on the £1bn contract to service the Hebridean islands and the Clyde for the next eight years, with state-owned CalMac winning the bid. The cost of the tendering alone came to over £1m.

During the tendering process trade union leaders, opposition parties and community campaigners were furious that Serco was in the running, accusing Scottish ministers of preparing to privatise CalMac’s heavily subsidised lifeline ferry services, putting the crews’ pensions and working conditions under threat.

When Serco won the £243m Northern Isles contract in 2012 it quickly announced job losses, cuts to services, introduced paid-for lounges and installed dividers on couches to prevent passengers from sleeping.

Scottish Labour has previously cited expert legal advice showing the Government did not need to put west coast ferry services out to the market.

Read more: Serco threaten to sue Glasgow City Council over £400m procurement concerns

However, Scotland's transport quango has now said correspondence from the European Commission on the Teckal Exemption, prompted, it said, by a joint approach from the Scottish Government and the RMT union, indicates that, in certain circumstances, public ferry services could be awarded to an in-house operator without the need for tendering.

It said the review would look in detail at the implications of the Commission’s response on future tendering, in particular the Teckal exemption and State aid rules. Key stakeholders will be engaged during the process.

The current Gourock – Dunoon deal will be extended by nine months to allow for the completion of the review.

Mr Yousaf said: “The reply from the European Commission provides welcome advice and information on the application of the Teckal Exemption. This gives us an opportunity to further consider future tendering options for Scottish Government ferry contracts.

“It is important to highlight the Commission has made it clear that any solution must comply with State aid law, as well as meeting the requirements of the Teckal exemption.

“We cannot pre-judge the outcome of the review. However, should it conclude that it would be possible to apply the Teckal exemption and meet State aid rules then we would be minded to provide ferry services through an in-house operator, taking account of the communities they serve. This would, of course, be subject to wider policy and value for money implications and the views of those communities.

Read more: Serco threaten to sue Glasgow City Council over £400m procurement concerns

“We need to give very careful consideration to the potential impact of any changes before final decisions are made. Pausing the current tendering exercise for the Gourock-Dunoon service will give us time to consider these complex issues so we’re clear on how best to deliver ferry provision in the future. The policy review will also consider the implications for the Northern Isles services. We have already started engagement with the current operators of both services to discuss the implications of the review."