Union warns 'inaction' could sabotage shipyard's survival

The biggest union at the publicly-owned Ferguson shipyard has claimed that government inaction is jeopardising its future.

GMB Scotland said a failure to deliver promised investment or new orders to Ferguson Marine would amount to "sabotage".

The union has been calling for a direct award of a new CalMac ferry order to help the Port Glasgow yard restore its reputation after delays and huge cost overruns building two dual-fuel ships.

Deputy First Minister Kate Forbes said the shipyard was of "national importance" and the government had previously acted to save jobs but any contract awards must satisfy procurement and state subsidy rules.

During a debate at Holyrood on Tuesday she also made clear the release of modernisation funding was dependent on the firm presenting a revised business plan which factored in new orders.

The Holyrood debate discussed a report from the parliament's public audit committee which criticised previous governance failures but also called for more support for the shipyard to help it become more competitive.

It warned the shipyard's viability was at risk without urgent action to address years of underinvestment and give the firm "a realistic chance" of securing new work.

GMB Scotland general secretary Louise Gilmour said the report should serve as an "emergency flare".

"The public audit committee could not have sounded the alarm more clearly or loudly over the future of Ferguson Marine," she said.

"Its report demanded swift and effective action from the Scottish government but, in the six months since, we have heard only excuses and seen no action at all."

She said ministers from John Swinney down had taken turns to "wring their hands and tell us how complicated it is".

"Scotland has a publicly-owned shipyard which successfully built small ferries for generations and a publicly-owned ferry company that urgently needs them. It is not that complicated," she added.

In September, a cross-party coalition of community leaders, trade unions, and local politicians urged First Minister John Swinney to award the contract for a replacement for the CalMac ferry MV Lord of the Isles directly to the shipyard.

The project has been ready to go to procurement since mid-summer, but three months on, no timescale has been given for a decision.

Forbes said any such award must be lawful and Transport Scotland was still considering the business case.

Nearly 18 months ago, Forbes announced that £14.2m of investment could be available over two years to install modern equipment such as new cutting machines and a semi-automated panel line to raise productivity.

But in October she confirmed that only £570,000 of this money has yet been handed over.

Labour's Daniel Johnson accused the government of creating a "catch 22" situation where it will not provide the money until orders are forthcoming but the yard was unable to secure those orders without investment.

Forbes said the money was still available but it depended on the board and new chief executive presenting a revised business case which reflected new work.

"The funding is available - it is about drawing down that funding. There is no challenge in respect of that funding not being available," she said.

Ferguson's is the last surviving shipyard on the lower Clyde and has built more than 360 vessels since it was established in 1903 including about half of CalMac's current large vessel fleet.

The firm employs about 300 workers, including about 50 apprentices, in an area of high social deprivation that has lost about 1,200 jobs in recent years.

But it has suffered from the long-running controversy over construction of the two dual-fuel ferries, which are the first ships of their kind ever built in the UK.

While there is cross-party agreement the workforce is not to blame, the difficulties have harmed the firm's reputation, making it harder to win new orders.

The contracts were awarded in 2015, just a year after the firm was rescued from administration by Jim McColl, a former economic adviser to Alex Salmond and Nicola Sturgeon.

During the debate, Daniel Johnson claimed the SNP was ultimately to blame for the subsequent damage because it had "used the yard as a political football for a political stunt".

Kate Forbes said her party had acted to save jobs, including when it nationalised the firm in 2019.

Ferguson's is still working to complete the second ship MV Glen Rosa, currently due for delivery next June, but it needs a new order urgently because there could be more than a year of design work required before it can start cutting steel.

Scottish Liberal Democrat Jamie Greene said the public audit committee took no view on the issue of direct award, but added: "What is the point of having a publicly funded state-owned asset such as a shipbuilding yard and then consistently overlooking it when issuing contracts?"

He also called for a change in procurement practice by CMAL to score for "social value" when awarding contracts.

CMAL has in the past only negotiated social value benefits after it has chosen a preferred bidder, and says to do otherwise could be seen as illegally discriminating against overseas firms.