OCEAN-GOING FIASCO
Broken promises, a bitter legal fight, millions wasted – and two half-built ferries rusting on the Clyde without having carried a single passenger. Welcome to the SNP’s latest...
It was a dreich Port Glasgow day in November 2017. the rain came down in rods and the local MSP, Stuart McMillan, readied to play the pipes. ‘It’s great to see commercial shipbuilding return to the Clyde at Ferguson’s,’ gushed Nicola Sturgeon.
‘these state-of-the-art ferries are more sustainable, therefore contributing to Scotland’s world-leading climate change goals. It’s a special day for Ferguson’s and a big achievement…
‘I know that the management and workers of this yard are determined to compete and win orders well into the future.’
And, with that, Miss Sturgeon struck a mallet and, with a whoosh of water and the clanking of great chains and to the cheers of all present, the huge, half-built new ferry for Arran thundered into the Firth of Clyde.
But all was not at it seemed. there had been much Scottish Government stage dressing. the vessel’s ‘windows’ were but squares of black paint; much of her superstructure but painted plywood.
the Glen Sannox should have been in service by the end of 2018. Yet construction was mysteriously fitful. By January last year senior Caledonian MacBrayne deck officers were murmuring that neither the Glen Sannox nor the second dual fuel ferry would ever sail. By last summer it was evident there was a full-blown row between the yard and bosses at Caledonian Maritime Assets Limited, the obscure quango which is responsible for CalMac ferries and harbours, and commissioned the contract.
Following the extraordinary stand-off, Ferguson’s eventually fell into administration and is now in public ownership. the Glen Sannox is today a rusting hulk, her bottom heavy with seaweed and barnacles. Her unnamed twin, still high and dry and literally in bits, looks like a ship in an advanced stage of demolition.
Now Jim McColl – a prominent supporter of independence who rescued Ferguson’s several years ago – threatens to sue the Scottish Government: there are claims of bad faith from all quarters, tens of millions have been wasted, and retrieving the situation could cost at least £230million.
WHAt is now David MacBrayne Ltd – the entity held by and accountable to the Scottish Government – has only been wholly in public ownership since 1969. Most of us are only aware of its operating arm, Caledonian MacBrayne; otherwise most important in a byzantine corporate set-up is Caledonian MacBrayne Assets Ltd – CMAL.
CalMac runs the ferries; but CMAL procures them, owns them, and also assorted piers, slipways and offices the length of the west coast.
the principles of good ferry operation are long settled. that passage by sea should be as short as possible, allowing drivers to complete as much of their journey as possible by road. that all ferries should be able to carry any vehicle legally permitted on the British highway – and that all ferries should be of ‘drive-through’ operation, with no need for motorists to reverse or turn.
Given the wide tidal range in West Highland waters, smaller vessels load at concrete slipways and large ships from ‘linkspans’ – tideadjustable ramps.
Save for four minor crossings, in private or local-authority hands, and the highly efficient Western Ferries service between Gourock and Dunoon, the whole network is one CalMac state-owned monopoly operation.
More and more ships are ‘route-specific’ and would struggle if deployed elsewhere. Services and ports vary too. Wemyss Bay to Rothesay and Oban to Craignure carry a very high number of passengers.
Only three large CalMac craft can berth at Mallaig. And costs are eyewatering. A typical major ship has two 22-strong crews, alternating on a fortnight-on/fortnight-off basis.
And, just like a car, a ship is a depreciating asset, with an optimal working life of 20 to 25 years. But CalMac has suffered from long neglect.
Only two major vessels have entered service since the SNP attained power in 2007. Five are over 30 years old. two – the Isle of Arran (1983) and the Hebridean Isles (1985) – are so venerable their lifeboats have oars. the Isle of Cumbrae turns 44 this year.
there are, in addition, two fundamental problems. One is the opacity that surrounds the whole operation. It should be possible to stand up in the Scottish Parliament and ask the transport Secretary, for instance, how much it costs to run the service from Stornoway to Ullapool. But he will not answer because he does not know – and no-one anywhere in CalMac can or will tell you either. It’s part of a deliberate fog, to protect what is now a national institution in an age of compulsory competitive tendering. But there is a still bigger complication.
Ultimately, CalMac answers to ministers in Edinburgh – and no one in Edinburgh knows anything very much about ferries. All the more dangerous when you have Nationalist politicians much given to virtue-signalling.
three things unnerved many back in 2014 when CMAL first went public with the announcement of two new ferries to be built for the Ardrossan to Brodick service and the Uig, tarbert and Lochmaddy route – with a pretty artist’s-impression of the craft; even an animation of one surging through digital seas.
the first was their propulsion: Glen Sannox and her unnamed sister (‘Hull 802’) were to be dual-fuel craft, running both on diesel and liquified natural gas. ‘LNG is significantly cleaner and has been adopted by ferry operators in Northern Europe in response to tighter emissions regulations,’ CMAL enthused. SNP ministers enthused still more noisily.
the second was the sheer size and complexity of the ships. Each would be 335 feet long, with vast (and separately constructed) LNG tanks.
EACH would boast three bow-thrusters and one stern-thruster, as well as the main propulsion. the innovative stern ramp would slide sideways, allowing use of most CalMac linkspans regardless of pier alignment.
And each had capacity for 127 cars and near a thousand passengers.
Most bewildering of all, the vessels would be identical – though destined for very different routes.
the passage from Ardrossan to Brodick takes only 55 minutes and has year-round, steady commercial traffic, heavy tourist traffic in spring and summer, and high passenger volume, especially in the early evening.
the services from Uig, in the north of Skye, to Harris and North Uist are very different. there is high tourist use in
the summer, but very few cars in the winter. There is some commercial traffic for Lochmaddy, but virtually none for Harris – and there is never heavy foot-passenger demand. Time at sea is an hour and 40 minutes.
Yet each is to have the same behemoth, of such a scale that huge amounts of money are being spent lengthening the piers they will use, dredging the ports and erecting considerable new infrastructure – for the third time, at Uig, Tarbert and Lochmaddy, in 35 years. Tens of millions are being spent, vast LNG tanks will be erected: handsome passenger facilities at Tarbert, completed only in 2004, are being blithely demolished again.
And SNP insistence that new ships be built to low-emission environmentally-friendly standards should robustly be questioned.
Much has been made of three recent double-ended craft – the Hallaig, the Lochinvar and the Catriona – whose diesel plant is supplemented with rechargeable lithium-ion battery banks and who are extraordinarily smooth and vibration-free in operation. But, as Roy Pedersen – Scotland’s foremost ferry expert – has written of the 2012 Hallaig, ‘A 20 per cent saving in emissions has been claimed.
‘The £11million build-price, however, is two-and-a-half times that of a conventional ferry of greater capacity – yet analysis by Professor Alf Baird of Napier University has demonstrated that, compared with more efficient diesel mechanical vessels, there are no savings in emissions per vehicle or passenger.’
MSPs were only informed last week about how bad an idea this was – and how CalMac itself had opposed the use of LNG – by Commodore Luke van Beek, a respected expert appointed by SNP ministers to report back on the state of the project who was then largely ignored. The complexity and expense of the LNG plant is central to the Port Glasgow fiasco.
And central to this unfolding humiliation are two other questions: how, precisely, was the contract awarded to Ferguson Marine? And who is really to blame for the inordinate delay?
FACING a Holyrood committee last week, Jim McColl was adamant that the First Minister announced the award of the £97million contract before a deal had, in fact, been agreed.
According to Mr McColl, talks between the shipyard and CMAL were indeed at an advanced stage, Ferguson’s hoping to secure the tender at £103million to £105million. And then Nicola Sturgeon announced that £97million figure – ‘That caught us by surprise….’
She was, that August 2015 day, deliberately trying to upstage Chancellor of the Exchequer George Osborne, who was to announce £500million of investment at Faslane on the morrow.
‘You’d be better building from scratch and to a design that’s more suited to what’s needed,’ McColl later told the BBC. ‘They could build three smaller vessels for less than £100million and it would give them more flexibility.’
He can barely hide his fury at the Scottish Government, who have publicly accused Ferguson’s of poor management.
‘It is outrageous when not once have they investigated their own entity, CMAL, which we believe is at the core of the problem,’ he said. ‘They need to be held to account and the Government needs to be held to account.’
He is particularly anguished because he would have happily constructed the vessels at a moderate loss, if only to showcase what Ferguson Marine could do.
BUT whom to blame? Essentially, construction ceased – and the yard subsequently went under – because CMAL refused to make additional payments as the cost of the project began remorselessly to spiral.
If McColl is to be believed, the shipyard was hamstrung by a demanding CMAL who kept changing the brief for the vessels and the design, refused to discuss changing the price and refused even to go to arbitration.
From CMAL’s perspective, though – as one observer puts it – ‘Ferguson signed up to something it did not have the capability, knowledge, or cash to build and were found out.’
There is also strong evidence that CMAL warned ministers not to give the contract to Ferguson’s – and was ignored.
Mr McColl’s main gripe is that he kept demanding that SNP ministers get control of its own quango and force it round the table for mediation to help end the dispute. He made his demand to Nicola Sturgeon directly, and to Derek Mackay and other ministers, yet it never happened.
Mr McColl questions why Mr Mackay has so resolutely refused to stand up to CMAL.
He believes that the reason for the refusal to insist on an independent expert witness process was a threat made by CMAL to Mr Mackay, who was Transport Minister when the contract was awarded and later nationalised the yard as Finance and Economy Secretary.
In one meeting, Mr McColl claims, Mr Mackay instructed officials to leave the room then told him the reason he wouldn’t force mediation on CMAL. ‘They have sent us a legal letter, and if I continue to unduly influence them, as an independent board, they will resign en masse and make it public as to why,’ he said.
The shipyard was saved from collapse in 2014 in a deal struck between former First Minister Alex Salmond and Mr McColl, a proindependence supporter, days before the referendum.
Certainly, industry experts have questioned why the vessels were being built in the open air – no longer thought good practice; most shipyards work these days in enormous sheds – and side by side, on what is a very restricted site.
And those with long memories recall a past Ferguson debacle (under different ownership) in 1988. On delivery of the new Isle of Mull to CalMac, it was found she had not sufficient ‘deadweight’ to carry the promised capacity of vehicles. The ship had to be lengthened, her berths had to be lengthened and CalMac had to be compensated for lost revenue.
Recently published photographs
are not reassuring. Hull-plating on the port side of the Glen Sannox is buckled and the vessel’s ‘ribs’ can clearly be seen.
‘Such structural defects weaken the hull and would lead me to examine the quality assurance during construction,’ insists Dr Spyros Hirdaris, an expert in maritime safety. ‘In open waters and bad weather, the hull may be weaker than it should be.’
Jim McColl wants a full public inquiry and a growing number of opposition MSPs want to know why the contract was awarded to Ferguson’s – over five cheaper bids from elsewhere; why ministers did not intervene to sort things out between Ferguson’s and CMAL; and why Derek Mackay insisted on nationalising the yard against the counsel of Mr van Beek.
The central scandal is the awarding of this contract, on terms self-evidently against the best interest of the taxpayer, to a concern owned by a man long close to SNP ministers.
Mr van Beek this week told MSPs that CalMac’s chief executive had personally told him that ‘the two ships are not the ships we wanted’. The central mistake was the scale and complexity of these vessels, as Roy Pedersen told MSPs, ‘with a far higher specification than necessary’.
He said: ‘Why build a ship with a capacity of 1,000 passengers for a route, namely the Uig routes, on which there has never been more than 312 passengers carried on any sailing, and when the average carryings are half that and in the winter time even less than that?’
Bluntly, Mr Pedersen declared both vessels should be scrapped.
He said: ‘It’s good business practice when you are on a losing run to cut your losses and start again, same when playing poker. It doesn’t do to keep putting good money after bad.’
And as to how the Scottish Government counterintuitively awarded the job to the highest bidder, Pederson – who sits on its Ferry Industry Advisory Group – said: ‘I don’t know the answer but three things spring to mind – one is incompetence, the other is vested interest and the other is corruption.’
And what has more than a whiff of scandal may finally claim the First Minister herself.