Plans to establish a new ferry link between Cornwall and the Isles of Scilly have been hit by the announcement that the government will not be providing funding towards the scheme.

The Route Partnership is leading the project and includes Cornwall Council; the Council for the Isles of Scilly; and the Duchy of Cornwall. Around 45,000 passengers use the service each year and the partnership has already reduced the cost of the scheme by £25m, with Cornwall Council borrowing an extra £5m.

New harbour facilities for Penzance and St Mary's, plus a new vessel to operate the link, had been proposed as part of The Route Partnership's plans. Cornwall Council's Graeme Hicks said: "The decision not to provide funding is a huge missed opportunity and I am very disappointed by the Government's short sightedness."