Ferry Fiasco (Scotland)

[8] Caledonian MacBrayne ("CalMac") operate mainly in the Clyde and Hebrides regions of the west coast of Scotland, and serve a local population of around 45,000 people.

[12] In August of that year, then First Minister of Scotland Alex Salmond brokered a deal with industrialist Jim McColl who bought the business and assets, and formed Ferguson Marine Engineering Ltd. (FMEL) as a new subsidiary.

[16] As contract negotiations between the Statutory Harbour Authority Caledonian Maritime Assets Ltd ("CMAL"), owner of 16 ports and harbours in the Clyde and Islands, and Ferguson Marine were concluding in September 2015, the chairman of CMAL, Erik Ostergard, criticised the process, ongoing costs and Ferguson Marine's lack of a track record in projects of this nature.

On 9 October Transport Scotland informed CMAL that, after due consideration, Scottish ministers were aware of the risks but content to proceed to award the contract.

Ferguson also uniquely received a 424-page document from a design consultant setting out CalMac's technical requirements, which was not extended to other bidders, who had to rely on a more limited 125-page specification.

Liquefied natural gas needs to be stored at −162 °C and the required tanks and bow thrusters meant each ferry being 200 tonnes heavier than an equivalent vessel.

The contract for the ships stipulated that Ferguson Marine had to submit individual sets of drawings at least 30 days prior to work starting, as CMAL needed approval from Lloyd's Register.

[17] The shipbuilder reported that it had to engage in out-of-sequence working to try to keep the project moving, so it prioritised constructing the vessels to meet the milestone dates.

[17] CMAL's onsite team identified problems during construction and issued reports to Ferguson Marine's management outlining their concerns and recommendations.

[17] Audit Scotland subsequently found that although this financial support allowed the shipbuilder to retain its workforce, it had little effect on the progress of construction.

[17] At launch, windows had been painted on, the funnel was not operational and the bulbous bow, though present, was made from flat sheet steel and had been rejected by an inspector from Lloyd's Register as requiring to be renewed in its entirety.

A turnaround director, Tim Hair, was appointed between August 2019 and July 2021: he brought improvements to the yard and created 100 jobs, but there was criticism of the £1.2 million paid in fees to secure his services.

[26] In November of the same year Ferguson Marine announced the ferries would rely on diesel alone for an unquantified period as they required bespoke vacuum sensors, with a lead-term of 36 weeks for delivery, in order to comply with refrigerated LNG regulations.

The work means that planned sea trials of the Glen Sannox have been delayed until the first quarter of 2024, raising doubts over whether the ship will be available for the start of the 2024 summer season.

[2] In February 2024 it was announced that Glen Sannox had begun her sea trials, but her projected in-service date had slipped further, to late May;[41] then in March 2024 that her handover was likely delayed to July/August.

[45] Before this additional delay trials the ferry was expected to carry passengers for a few days in December 2024, however it will thereafter be out of service for a few weeks for annual maintenance.

[50] Audit Scotland also found "insufficient evidence to explain why Scottish Ministers made [the] decision" to award the contract to Ferguson Marine.

[51][52] Former SNP Deputy Leader Jim Sillars accused the Scottish Government of criminal "misconduct in public office" and lodged a complaint to Police Scotland requesting they investigate the missing documents.

[53] This call was later supported by the Scottish Conservatives transport minister Graham Simpson[54] and SNP-led North Ayrshire Council, but Police Scotland confirmed they were not investigating the allegations.

[61]In a written response to the Public Audit Committee, Mackay said that he had "confidence" in the recommendation, and that there was expectation the contract would receive "sufficient monitoring and oversight".

[63] In September 2022, Transport Scotland published a report by consultants Ernst and Young called "Project Neptune" which concluded that having multiple state agencies involved in the procurement process led to confusion over roles and responsibilities.

[64] Following the BBC's disclosure of documents suggesting that Ferguson Marine had benefited from preferential treatment in the procurement process, John Swinney told the Scottish Parliament on 27 September 2022 that Audit Scotland would again investigate the issue.

John Swinney stated that "no decision" would be made to release more public money towards the cost of completing the ferries until "due diligence" was carried out by the Scottish Government on the company, supported by external, independent financial advisors.

[66] There, she "completely and utterly" refuted there was anything untoward in the procurement process, but that there were powerful arguments in favour of Ferguson Marine given it was the last shipbuilder on the lower Clyde and thousands of jobs were at stake.

[67] In late November 2022, Audit Scotland announced that it was unable to account for £128.25 million in public money spent by Ferguson Marine on the ferries.

[68] In the spring of 2023 the Scottish Government commissioned a report by the consulting firm Teneo, at the cost of £620,000, to give an independent assessment on the value for money of completing the ferries rather than scrapping them.

[71] However, the Greenock Telegraph subsequently reported that the value for money study into the MV Glen Rosa considered it likely that costs would rise even further in future based on Ferguson Marine's past record.