Ferry Procurement (Ferguson Marine Engineering Ltd)

– in the Scottish Parliament at on 29 September 2022.

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Photo of Douglas Ross Douglas Ross Conservative

1. This week, it emerged that Ferguson’s shipyard received preferential treatment from this Government and its agencies in the shipyard’s bid to build two ferries. Ferguson’s was the only bidder that was given special access to a 424-page cheat sheet on how to build ferries—a cheat sheet that it literally copied page after page from. It received a confidential in-person meeting with the people who were involved in buying the ferries. It was the only bidder that was allowed to resubmit with a new design, which a former technical director of CalMac Ferries called “completely wrong”. Then, after the deadline, it was the only company that was allowed to change its price.

Why did Ferguson’s shipyard, which was then owned by a Scottish National Party Government economic advisor and prominent independence supporter, receive special treatment from the First Minister’s Government?

Photo of Nicola Sturgeon Nicola Sturgeon Scottish National Party

Before I come on to the specifics of the question, I note that Douglas Ross might want to make his mind up about what his allegations are. For months, now, he appears to have alleged—wrongly, I hasten to add—in the chamber and elsewhere that the Scottish ministers directed and forced Caledonian Maritime Assets Ltd, against its will, to award the contract to Ferguson’s shipyard. Today, it appears that he is alleging that CMAL in some way collaborated with Ferguson’s to ensure that the contract went to the shipyard. Perhaps he needs to get a little bit of clarity about the allegations that he is making.

The First Minister:

I turn to the specifics. Ministers are not aware of any impropriety in the procurement process. That said, ministers were not involved in the process; we were not sighted on procurement documents or privy to exchanges between CMAL and bidders. However, the allegations in the BBC’s “Disclosure” programme are serious, and, earlier this week, I asked the permanent secretary to engage with Audit Scotland about further investigation. I welcome the confirmation from Audit Scotland that it will look at the substance of the allegations.

On the allegation relating specifically to the CalMac statement of operational and technical requirements, of course it needs to be properly investigated. However, as I understand it, there is no suggestion that it was CMAL that passed the document to Ferguson’s. In fact, the BBC suggested that it was a design consultant who did so.

The allegations are serious, and they should be investigated in the normal way. In the meantime, we will continue to support Ferguson’s shipyard in its work to complete the ferry contract.

Photo of Douglas Ross Douglas Ross Conservative

The only conclusion that any reasonable person can draw is that the deal was rigged. It seems that Nicola Sturgeon is the only one who saw this week’s programme who does not think that the deal was rigged.

She has asked for clarity, but it would have been helpful for members who are trying to get clarity if all the information had been available, rather than it coming out as it did this week. The documents that were finally revealed show that Ferguson’s had the cheat sheet. It had its answers whispered in advance and then it got to change its answers after the deadline. No other company got to do that.

We did not find out any of that until a leaked dossier was uncovered by investigative journalists. Nobody knew about the depth and breadth of the special treatment that Ferguson’s received. During lengthy investigations, neither Audit Scotland nor the parliamentary committee concerned got any of those details. Instead, we got secrecy. The public were kept in the dark, the Scottish Government’s auditor was kept in the dark and this Parliament was kept in the dark. It is clear that there has been a cover-up by the First Minister’s Government and its agencies.

Why has none of that come to light until now?

The First Minister:

The Scottish Government has fully co-operated, and will continue to fully co-operate, with parliamentary investigations, and it will fully co-operate—as Audit Scotland has noted that it has done—with any Audit Scotland investigation.

The clarity that I asked for from Douglas Ross is important. People watching First Minister’s question time will have heard him suggest in the chamber, in previous weeks and months, that CMAL did not ever want to give the contract to Ferguson’s shipyard and that it was somehow forced to do so against its will by the Scottish Government. That was wrong, and I think that it has been evidenced that that was wrong. Today, of course, Douglas Ross has come to the chamber and said the contrary—that CMAL somehow colluded with the yard to ensure that the contract went there.

We will continue to ensure that investigations are supported. As I said, this week I asked the permanent secretary to engage further with Audit Scotland, and I welcome Audit Scotland’s statement. The procurement process was conducted by CMAL. Rightly and properly, ministers were not involved in it. The job of ministers was to save the shipyard from closure and to save and support the jobs of the people who continue to work at the shipyard, and we will continue to offer that support.

Photo of Douglas Ross Douglas Ross Conservative

By giving Ferguson’s special treatment, as details that were unearthed only this week show, it appears as if the Government has broken European Union laws, and it may have committed fraud, but the First Minister thinks that that is no big deal, that it is just another SNP disaster, to which no one should pay any attention, and that there is nothing to see here.

However, this does matter. [

Interruption

.]

Photo of Douglas Ross Douglas Ross Conservative

It matters to the islanders who have been abandoned by the Scottish Government. It matters because the price and the delays keep spiralling further. Yesterday, it emerged in a letter from Ferguson’s to a committee of this Parliament that the delays are continuing. Hull 802 will now be six years late. According to Ferguson’s, its total project budget was £125.5 million in March of this year, but the maximum budget is now £209.6 million. That is an increase of £84 million. In its letter to the committee, Ferguson’s says that it briefed Scottish ministers on that last week.

What did Ferguson’s say to ministers? Is the latest enormous cost increase correct?

The First Minister:

I agree with Douglas Ross on the fact that these things matter, which is why I and the Government take them as seriously as we do.

The information given to ministers by the new management at Ferguson’s shipyard is the information that is set out in the letter that will be sent to the parliamentary committee tomorrow. [

Interruption

.] If Douglas Ross wants to wait for the rest of the answer, he might get the detail that he is requesting.

On the delivery schedule, the target date for 801 has not changed. On the target date for 802, there is an estimated further slippage of one to two months.

On costs, Ferguson’s has set out its latest estimate of costs, but—this is the key point—ministers have yet to properly scrutinise that estimate, so no decision has yet been taken about any further increase in the budget for the ferries. As that process of due diligence, which the Government has to undertake, is completed, we will update Parliament in the normal way. That is what we will continue to do as we work to continue to support the shipyard, to support the completion of the ferries and—yes—to support the jobs that depend on that shipyard. That is the responsible approach to government.

Finally, I am not sure that Conservative Douglas Ross is on very strong ground at all today in talking about Government disasters.

Photo of Douglas Ross Douglas Ross Conservative

Given that answer, I do not think that Nicola Sturgeon will ever be on strong ground in talking about ferries, because—incredibly—she is saying that the £84 million increase projected in a letter to a committee of this Parliament and spoken of to her Government ministers a week ago will not be scrutinised. That is basically the First Minister saying that there will be an £84 million increase for three months.

I am not sure what scrutiny of those estimates will come up with, other than to say that a three-month delay is basically costing taxpayers about £1 million a day, because that is what £84 million works out at.

The First Minister told me in March of this year that she took ultimate responsibility for the deal and that the buck stopped with her. So, let us hear her take ultimate responsibility for the great ferry scandal. Her Government agreed a deal for the ferries without agreeing a design for the ships. Her Government ignored experts who advised it not to go ahead with the deal and it waived the refund guarantee that is a mandatory requirement in that kind of contract.

Now it appears that the whole deal was rigged. The Government seems to have given special treatment to a political adviser and ally. That looks like corporate fraud and there is a stench of political corruption, but nobody has been sacked, and the Government says that nobody is responsible and nobody is to blame.

What happened to the First Minister who used to have a monthly photo call at Ferguson’s shipyard? The First Minister used to pose for pictures at the yard and shouted from the rooftops that it was one of her proudest achievements. Nicola Sturgeon was happy to take all the praise. When will she start to take the blame?

The First Minister:

Douglas Ross is now reduced to simply standing up and making up things that I have said in answer to questions. I will never apologise for the actions that this Government has taken to save the jobs of the people who work at Ferguson’s shipyard. Unlike my counterparts in other Governments, I will always take responsibility for the actions of this Government.

I whole-heartedly agree that the issue matters—it really matters. People who are out there watching right now will want to see me and my Government held to account on this. That is right and proper, but the people who are watching this session are also terrified. They are terrified about the inability to heat their homes and the inability to pay their mortgages. [

Interruption

.]

The Presiding Officer:

Members, we like to hear each speaker when they are on their feet. Please continue, First Minister.

The First Minister:

They are terrified about the security of their pensions.

All week, people have heard Douglas Ross demanding that I match Tory tax cuts for the richest people in our society. Those tax cuts have already sunk the pound, crashed the mortgage market, brought people’s pensions to the brink of collapse and forced the Bank of England into an emergency bailout, and they will force deep reductions in public spending. I think that people might have wanted to hear Douglas Ross explaining today why he thinks that the Scottish Government should emulate those policies.

For the avoidance of doubt, we will not emulate those policies, but Douglas Ross’s silence about his demand that we do so says everything about his appallingly poor judgment.