Scottish Government to directly award four ship contracts to Ferguson Marine

The Scottish Government will directly award the contract for four new ships to Ferguson Marine in a “bridge to the future” for the beleaguered yard.

The publicly-owned facility in Port Glasgow, Inverclyde, has been at the centre of a political storm since it was taken over in 2019, revolving around the late and over-budget delivery of the Glen Sannox and Glen Rosa ferry for the Isle of Arran.

The Glen Sannox was delivered last year, with the Glen Rosa not due to be handed over until the end of 2026, with the total cost closing in on four times more than the initial £97.5 million contract.

On Tuesday, the Government threw the yard – the last commercial shipyard on the Clyde – a lifeline, with Deputy First Minister Kate Forbes announcing the direct award of four new ships, subject to a “due-diligence” exercise.

Two of the vessels will be smaller ferries which will be hived off from the second phase of the Government’s small vessel replacement programme – which was slated to build three replacement ferries.

The two ferries will serve the Sound of Harris and the Sound of Barra in the Western Isles.

The yard will also be given the contract to build two fishery support vessels.

The Deputy First Minister also resisted calls for the replacement for the Lord of the Isles to be directly awarded to Ferguson Marine.

Speaking in Holyrood, Ms Forbes said: “Together this represents a programme of four new vessels proposed to be built at the yard.

“This is a substantial and clear demonstration of our confidence in Ferguson Marine.

“Ministers must of course ensure that public contracts are awarded in accordance with legal requirements and demonstrate value for communities and the taxpayer.

“A detailed due diligence process is under way within the Scottish Government to closely assess the viability and implications of these proposals.

“Engagement with the Competition and Markets Authority is also among the steps that are required before any formal contract award decisions can be made.”

The Deputy First Minister was speaking on Tuesday PA Media

The Government, Ms Forbes said, would still seek to return the yard to the public sector “when the time is right”, with hopes the new contracts would help the yard to “re-establish itself as a credible, competitive shipbuilder by demonstrating consistent delivery, controlling costs and delivering vessels that perform in service”.

“These substantial proposals we are announcing today would deliver for Ferguson Marine, for island communities and for Inverclyde,” she added.

“We are strengthening ferry resilience and connectivity for communities that rely on dependable services.

“At the same time, our plans for new vessel awards would support skilled employment and industrial capability in Inverclyde, where Ferguson Marine remains an essential part of the local economy and a shipyard of national industrial importance.

“We rescued Ferguson Marine for a purpose and we are determined to see it succeed.”

Louise Gilmour, secretary of trade union GMB Scotland, welcomed the news.

“The work will allow the yard to turn the page and allow a skilled, committed and blameless workforce to begin restoring its worldwide reputation for excellence,” she said.

“These are exactly the kind of ships Fergusons has been sending around the world for more than 100 years and must now open a pipeline of work to allow this famous yard to thrive for 100 more.

“We are an island nation, will always need ships and Ferguson Marine should be helping build them.”

Graeme Thomson, the chief executive of the yard, said it Tuesday was a “watershed moment”.

He added: “By unlocking vital infrastructure and equipment upgrades, this direct award is the catalyst for Ferguson Marine to become a world-class, digitally enabled shipbuilder, capable of competing on a global stage.

“Our experience, demonstrated through our successful work on similar projects, means we are uniquely positioned to build these four vessels.

“I have the utmost confidence in the talent and technical skill within our team to produce ships fit to serve communities and provide critical research infrastructure for years to come.

“While we acknowledge the challenges of the recent past, they do not define our future. We are returning to the core of what we do best: delivering world-class vessels on the Clyde.”

David Dishon, the yard’s chief financial officer, said the direct award would be “a significant step towards financial sustainability” and would “allow us to turn a corner”.