Capital funding for Liverpool’s new cruise liner terminal is being withdrawn by the city council and a private backer sought as cost soars to £88m. Tony McDonough reports

Liverpool City Council is withdrawing the new proposed new cruise terminal from its capital spending programme as the cost balloons from £50m to a projected £88m.

Even with £20m committed by the Liverpool City Region Combined Authority to the project, that still leaves a significant shortfall. LBN had learned the cash-strapped council is now seeking a private sector partner to take the scheme forward.

A spokesman for the city council said: “We can confirm we are reviewing our options in relation to the construction of a new cruise terminal.”

He also added there was a separate proposal to transfer the running of the existing terminal to a third party operator, saving the authority £450,000 a year.

The internal budget proposal says: “Securing a third party operator to manage the operation on behalf of the city will ensure the city retains all of the economic benefit from passenger spend but without the financial outlay of managing the operation.

“Liverpool Cruise Terminal is the only owned and operated cruise terminal in the UK, other than Portsmouth which is a cruise and ferry port.”

In August LBN reported the authority “remains committed” to the new terminal which would replace the existing facility that opened in 2007. However, a council cabinet report reveals the city is now seeking “less costly options”.

In early 2020 the council was ready to press go on the new terminal, including a 100,000 sq ft terminal building over two storeys as well as a 200-bed hotel at Princes Dock Liverpool Waters.

It would have enabled the world’s largest cruise ships (up to 3,600 passengers) to embark and disembark at Liverpool and directly create more than 500 new jobs.

However, in March 2020 the COVID pandemic brought the global cruise industry to a halt. In 2021 the industry bounced back quickly with the world’s biggest cruise operator, Carnival, reporting strong figures.

Despite this, Liverpool City Council said it wanted to monitor the health of the cruise market for a longer period before restarting the project. Further pressure came from Liverpool’s biggest cruise rival Southampton. It opened its £55m Horizon Cruise Terminal in September 2021 boasting it was the ‘greenest’ facility in the world.

In an interview with LBN earlier this year, Chris Shirling-Rooke, chief executive of industry body Mersey Maritime, said it was “critical” Liverpool’s new terminal was built.

He explained: “Liverpool has made phenomenal progress over the past decade but, if we fail to invest in our key engines of growth, then we could face decades of decline.”

Now the latest council report says: “Following the impact of the global pandemic and uncertainty around the future of the cruise industry, the city’s corporate management team took the decision to pause development on the then £88m proposed cruise liner terminal.

“The council is working with partners to consider alternative, less costly options designed to meet post covid requirements; changes in security arrangements; and inclusion of greater sustainability features.

“The remaining existing budget is to be removed from the programme pending reporting of a preferred option and funding will be addressed as the new business case is brought forward.”

Cruise Liverpool welcomed 90 cruise ships and 200,000 passengers to the existing facility during the 2022 season. This has generated around £15m for the city. In 2023 109 vessels are already booked. This is expected to boost the city centre economy by around £16m.

Fred Olsen Cruise Lines generate £2.25m alone. It will commit 30 to operations per year into Liverpool. It has made reservations as far in advance as December 2024.