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Shipyard would be ‘flying high’ without ferries contract, claims former owner

Jim McColl, the former owner of Ferguson Marine said Scottish Government assertions that the yard would close without the ferry contracts are ‘nonsense’ (Andrew Milligan/PA)
Jim McColl, the former owner of Ferguson Marine said Scottish Government assertions that the yard would close without the ferry contracts are ‘nonsense’ (Andrew Milligan/PA)

The former owner of a Scottish Government-backed shipyard has said the business would be “flying high” had it not signed a contract for two late and over-budget ferries.

Ferguson Marine was nationalised in 2019, when problems were made public in the building of the Glen Sannox and the as-yet-unnamed hull 802.

In the ensuing years, the price has risen to an estimate of around £250 million, more than two-and-a-half times the original £97 million valuation – and the vessels are due to be in service next year – five years later than planned.

The Scottish Government has maintained the contract saved Ferguson Marine from closure and protected jobs at the yard – the last commercial shipbuilder on the Clyde.

But Jim McColl has repeatedly said that was not the case and there were other orders available to the yard.

“That’s just absolute nonsense, that anything negative would have happened to this yard if we hadn’t got the order,” he told the Public Audit Committee at Holyrood on Thursday.

“I wish we hadn’t got it, because we’d be flying high just now with a whole load of different orders, including the Type 31 destroyers working with Babcock.”

Mr McColl also said the Scottish Government was aware the yard would not be able to offer a key financial protection before it was announced as the preferred bidder.

Caledonian Maritime Assets Limited (Cmal) voiced its concerns over the lack of a full builder’s guarantee in an email to then transport minister Derek Mackay before he cleared the final contract.

Ferry being constructed
The two ferries are several years late and over budget (PA)

Mr McColl said he had been working with the Scottish Government and with Cmal in developing the bid and they knew a guarantee – which would protect public money in case there were issues with the building of the vessels – would not be possible.

According to Mr McColl, he told Inverclyde MSP Stuart McMillan – whose constituency includes the yard – they could not bid for the contract because of their inability to offer the guarantee – which was mandatory as part of the tendering process.

Mr McColl asserts Mr McMillan “took it up with the Scottish Government”, and Mr Mackay said the yard did not have to offer the guarantee and an alternative could be put in place.

“That was done well before we submitted the tender, because we weren’t going to have to put all the work in if we were going to have to put up a cash refund guarantee,” he said.

“We had made it quite clear all along, and we had confirmation in the terms of that email (from Derek Mackay) that an alternative would be acceptable.

Jim McColl and Nicola Sturgeon
Jim McColl with First Minister Nicola Sturgeon and shipyard staff during a photocall in 2015 to announce Ferguson Marine was the preferred bidder for the ferries contract (PA)

“We were working with Cmal all the way through the bidding process, so they knew all the way through the bidding process.”

In a statement, Mr McMillan said he did send an email to the Scottish Government following a meeting with yard management, although he did not explain what the correspondence said.

He added: “As the local MSP I was clearly active in campaigning to secure the future of the yard.

“After meeting with senior yard management, I wrote to the Scottish Government and received a reply, which is already in the public domain.

“I will never apologise for advocating to save jobs in my constituency.”

Full list of points that undermine Nicola Sturgeon and SNP’s story over ferries fiasco