The blockage of the Suez Canal earlier this year may have a knock-on effect for the progress of Helensburgh’s new leisure centre, it has been claimed.
Helensburgh Central Conservative councillor Gary Mulvaney had previously said that the Waterfront development was on time and on budget, but “issues of a commercial nature” may arise.
He was asked for details of the latter claim by Lomond North independent councillor George Freeman during a virtual meeting of Argyll and Bute Council on Thursday.
And councillor Mulvaney, who is the council’s policy lead for finance and major projects, said that time delays and price increases for materials had occurred, partly due to the Suez Canal blockage.
The Suez Canal – some 2500 miles from Helensburgh as the crow flies – was blocked for six days by the Ever Given in March after the vessel was buffeted by strong winds.
Councillor Mulvaney had previously said in a report: “Whilst the project has made significant progress to date and is being delivered in the midst of a global pandemic, currently it remains on programme and within budget.
“However, the project management team recognise that issues of a commercial nature will likely emerge given the size and scale of this complex major capital project, and we continue to work closely with all parties to mitigate and minimise the potential impact of these upon the delivery of the works.”
After councillor Freeman requested details of the potential commercial issues, councillor Mulvaney said: “There is mention of issues of a commercial nature but I think the sentence before that indicates what we are talking about.
“The leisure centre remains very much on time and on budget, but we are coming to the second stage and the fitout, and clearly there are potential issues that may face us.
“These include shipping costs and material costs, and the timescales, which affect when things will arrive on site and the cost.
“I was speaking to somebody about shipping costs and they say that there are huge delays because of what happened in the Suez Canal earlier this year.
“This person said there are massive price increases, and that the cost of a container is 30% more than it was a year ago, so there are potential pressures around the budget, as there always are.
“As councillor Freeman knows, the project is being delivered and if there are project issues it will come to a board, which in this case is the Helensburgh and Lomond area committee.
“But as we stand today, we are on budget and time and that is to be commended.”
Councillor Freeman then said: “My concern was that we were not just concentrating on Covid for any issues and now we have the Suez Canal thrown into it.
“I thought all containers and shipping costs were paid for, before that ship (the Ever Given) even set sail? I find it strange if there are additional costs – how could that be?”
Councillor Mulvaney responded: “I am not sure there was a question there, but clearly a number of things are affecting prices. ‘Just in time’ is very much the default option for materials arriving on site. They are due to arrive in the next few months and these orders were in place when prices have been rising.
“We are in the market and we need to be alive to it. I am not making excuses – I am just telling you what is happening in the real world. People have seen rises in a variety of costs for a variety of reasons.”
By local democracy reporter Andrew Galloway