Scottish Daily Mail
SNP’s ship yard on the brink
■ Bosses warn of risk of insolvency without new work ■ Former owner Jim McColl offers to buy yard for £1 ■ Ferries fiasco could get worse with MORE delays
The nationalised shipyard at the centre of Scotland’s ferries fiasco is on the brink of a major financial crisis amid warnings from its own board that it could go bust.
Directors of Ferguson Marine have said there is a risk of insolvency if it does not secure a ‘workstream’ of new contracts.
They also urged SNP ministers to give a final decision on whether the yard will get future CalMac contracts as it emerged a key deadline set by ferries quango CMAL (Caledonian Maritime Assets Limited) had been missed.
Minutes of the latest board meeting of Ferguson Marine Port Glasgow (FMPG) also reveal there is a risk of further delay to the two ferries being constructed on the Clyde because external contractors are not working to schedule.
It comes after economy Secretary Neil Gray this week committed to completing both ferries even though he admitted finishing the second vessel no longer represents value for money and that it would be cheaper to buy a new ship.
With Ferguson’s future in jeopardy, Jim McColl – who owned the yard before it was nationalised in 2019 – yesterday waded in and said ministers should have binned the ferries contract earlier.
he also offered to buy the yard for £1 if he got Government support with costs for two years.
The financial crisis at Ferguson Marine was revealed in minutes of a board meeting on February 2 in which director Chris Mackay said: ‘We need to have an eye on the solvency issue if we do not have a workstream.’
Tory MSP Graham Simpson said: ‘Though cheaper to start over and write off the money wasted on this fiasco, the SNP Government is pushing ahead.
‘The revelation the yard already knows it needs “to have an eye on the solvency issue” makes it vital ministers prevent more public money being wasted.’
Asked last night if FMPG intends to ask for any additional funding from ministers to ensure solvency, a yard spokesman said: ‘Discussions are ongoing about the future of the yard and what funding might be required.’
The FMPG board minutes also show bosses believe the ‘direct award’ of work within CMAL’s small vessel replacement programme (SVRP), which will lead to up to seven new ferries, would be the best option for the yard.
But they make clear the yard could miss out unless there is an imminent decision by ministers.
They stated chief executive David Tydeman ‘advised CMAL would like to start the public procurement process on April 23 if there is no appetite for a direct award before then’ and went on: ‘An update from Scottish Government is required.’ FMPG yesterday said it has still not been informed of a decision.
A CMAL spokesman said: ‘The decision on whether the SVRP contract can be awarded directly is not in CMAL’s gift.
‘We will be in a position to tender before the end of the year.’
Asked whether he would award the yard further ferry contracts, Mr Gray said: ‘At this stage we’ve more work to do to ensure the yard is fully competitive.’
Pressed on the issue, he said: ‘In terms of making sure it is competitive we have been working with the yard to support them but we have to be mindful of state aid and subsidy rules. That is why from day one the ambition has been to return Ferguson’s to private ownership.’
Scots billionaire Mr McColl yesterday warned the shipyard ‘is not going to succeed under public ownership, it really needs to be privatised’.
he told BBC Radio Scotland: ‘The only way they have a future is if the Government give them ferry orders. Other than that, they are in trouble.’
Asked if he would buy it, he said: ‘I would take it back for £1 and they would need to give me two years’ worth of costs so I could keep the workforce whilst building a new order pipeline.’
Mr Gray yesterday conceded the Ferguson debacle has been a ‘really difficult episode’.
Grilled on whether he has given the yard a blank cheque by vowing to pay for the two delayed ferries until completion, he said: ‘No. It is absolutely not a blank cheque. I made that explicit to the chief executive that we must protect costs as far as we can.’
Meanwhile, the FMPG minutes also show union representative Alex Logan warned the board that external contractors on the ferries were ‘extending time on their schedule and not working to the programme’ and that this ‘could cause a delay’.
‘It needs to be privatised’
THE ferries fiasco long ago degenerated into outright farce – and now the public are being invited to vote on the name of one of the incomplete vessels.
It’s a tin-eared decision to make such an appeal given the extraordinary scandal which has led to a stratospheric – and still rising – bill for taxpayers.
Most Scots are sickened by the long catalogue of costly blunders and the total failure of anyone in government to take responsibility for the shambles.
Yesterday we learned that the nationalised shipyard where the CalMac ferries are being built is on the verge of collapsing into insolvency.
There is a risk of further delay to the two ferries while, unsurprisingly, the ‘general mood from staff is low’, and some disillusioned workers are said to be leaving to take up other jobs.
On Tuesday, Economy Secretary Neil Gray committed to completing the beleaguered project – even though he admitted that finishing the second ferry no longer represents value for money.
His insistence that he is not handing a ‘blank cheque’ to the yard is difficult to believe, given that for many years his government has thrown good money after bad. With some understatement, Mr Gray conceded that the saga had been a ‘really difficult episode’ and ministers are ‘looking to ensure lessons are learned’.
We’ve heard these conciliatory and frankly meaningless comments before – and it’s clear that the SNP is incapable of learning from its many mistakes.
Tory MSP Graham Simpson is right to say that ministers ‘must watch this process like a hawk… to ensure there is finally delivery for betrayed and long-suffering islanders without any further delay’.
But a succession of incompetent ministers have failed to rein in mushrooming costs and ensure that this crucial contract was completed on time.
So how can we trust the present Government under hapless Humza Yousaf – himself a former transport minister – to turn the CalMac tanker around?
Meanwhile, CalMac chiefs have cancelled ferry bookings for coach tours to the Isle of Mull, in a further blow for businesses which face a slump in income.
Plainly, the needs of islanders are at the bottom of the list of priorities for bosses of the state-owned company – and indeed for the SNP Government.