Orkney Islands Council has cancelled the meeting where Elected Members would have set the authority’s budget for the financial year ahead.
The meeting of the Full Council had been due to take place on Thursday 21 February.
OIC Leader James Stockan said: “A crucial component of our budget for 2019-2020 is the funding we receive from the Scottish Government to operate our inter-island ferry service.
“We expect the service to be fully funded by the Government – a precedent set 12 months ago when full funding was awarded for the first time after years of campaigning by the Council.
“We have made numerous representations to Ministers at the highest level asking that the Government respects the will of Parliament and provides full and fair funding for the year ahead.
“I am disappointed to say that despite this, we are still awaiting a decision from the Government on this vitally important matter. This is a major hurdle when it comes to setting our budget. It leaves us with no option other than to take the exceptional step of cancelling this week’s Full Council meeting.”
The Government has allocated £10.5 million for inter-island ferry services in 2019-2020, but has not announced a specific amount for Orkney. Operating the Orkney Ferries fleet during that 12-month period will cost £6.8 million.
Councillor Stockan added: “Once again I would ask Minsters to do the right thing and respond favorably to our call for full and equitable funding for Orkney’s lifeline internal ferry service over the year ahead.”