Nicola Sturgeon criticised as MSPs publish Ferguson Marine ferries fiasco report

A long-awaited report into the Ferguson Marine ferries fiasco has identified serious failings – including Nicola Sturgeon’s decision to prematurely announce the shipyard as the preferred bidder.

Following months of investigation, a Holyrood committee found taxpayers and island communities have been “badly let down” by many of those involved in the project.

The 124-page report from the public audit committee is the most comprehensive account so far of the troubled programme to build the Glen Sannox and the as-yet-unnamed hull 802.

The ferries are meant to serve island communities in the west of Scotland, but are now five years late and with a price tag nearly tripled to almost £300m.

The decision to publicly announce Ferguson Marine Engineering Ltd (FMEL) – at that point owned by businessman Jim McColl – as the preferred bidder in 2015 came in for particular criticism.

Nicola Sturgeon was criticised for announcing Ferguson as the preferred bidder. STV News

Sturgeon personally attended the shipyard for the announcement, and the committee said the move “almost certainly” weakened the negotiating position of the ferry-owning body CMAL when problems emerged later.

One section of the cross-party committee’s report says: “Given that it was clear that considerable negotiations were still required, we question the First Minister’s decision to publicly announce the preferred bidder.

“In light of the contradictory views on offer, further explanation should have been sought by ministers before the final decision was taken.

“The committee is not convinced that such a public announcement was necessary or indeed appropriate for this project, especially at that time, given the considerable work and negotiation that was required before CMAL could take a decision to award the formal contract.

“We believe that this almost certainly weakened CMAL’s negotiating position with FMEL, particularly as important details of the contract were still being worked out.

“It also remains unclear why the First Minister led on the preferred bidder announcement and why the First Minister’s press release and associated social media communications did not reflect that there were ‘significant negotiations to be concluded’.”

The two SNP members of the committee, Willie Coffey and Colin Beattie, did not support this part of the findings.

The committee’s report said the launch of the Glen Sannox in November 2017 – an event also attended by the First Minister – was premature.

Ministers were not aware of CMAL’s concerns about the launch but should have played a more active role, the report said.

Derek Mackay at Ferguson's shipyard. — Derek Mackay at Ferguson’s shipyard. STV News

Committee convener, Labour MSP Richard Leonard said: “The people of Scotland have been badly let down by this project.

“There have been collective failures at government and agency level from the start.

“It has been dogged by a lack of transparency; by ineffective governance arrangements; by poor record keeping within the government; and by baffling communication failures.

“It is vital that lessons are learned. That means much-needed reform of governance arrangements for future vessel projects.

“But it also means a change in the way the government and its agencies conduct themselves and are accountable to parliament and the people.

“That is a challenge for the permanent secretary and the new first minister.”

What else did report say?

A number of recommendations are made by the committee, including greater transparency and record-keeping by the Scottish Government.

Other members of the government and public agencies also came in for criticism in the report.

The committee expressed “serious concern” at then infrastructure secretary Keith Brown’s failure to answer key questions about his role in the awarding of the contract.

It said former transport minister Derek Mackay showed “poor judgment” in sending an email to a constituency MSP, which FMEL interpreted as waiving its requirement to provide a builders’ refund guarantee.

The auditor general is still investigating the procurement process for the contract, following claims made in a BBC Disclosure documentary.

The committee was also frustrated by delays in receiving evidence from Transport Scotland officials, leaving them questioning the level of “respect” shown to parliamentary scrutiny.

Transport Scotland “consistently failed to accurately and timeously reflect CMAL’s significant concerns to Scottish ministers”, the MSPs said.

It is “particularly concerning”, they said, that no full record exists of a meeting between Sturgeon and Mr McColl from May 2017.

The Scottish Government has produced an email discussing the contents of the meeting but no full minutes.

It is still unclear how large amounts of public money were spent during Mr McColl’s ownership of the yard, the report notes.

The Scottish Government has until the middle of May to provide a formal response to the committee’s report.

But in a statement, a government spokeswoman said: “The Scottish Government welcomes the report from the public audit committee. We will study its findings carefully before issuing a full response to the committee.

“Changes have already been put in place to address many of the issues raised. This includes working with the shipyard’s senior management team to improve governance and accountability and revising processes for vessel procurement.

“The Scottish Government is committed to transparency and has proactively published more than 200 documents on its website. We have co-operated at every stage of the inquiry, as well as those previously undertaken by the rural economy and connectivity committee and Audit Scotland.

“Ministers have apologised for the delay to the ferries and the distress and difficulty caused.

“We are committed to their completion, securing a sustainable future for the yard and supporting our island communities that rely on this type of vessel on a daily basis.”