Ferguson Marine update

Scottish Ministers have taken action to ensure the completion of two ferries by Ferguson Marine following a due diligence assessment carried out on forecast costs.

In an update to parliament, Wellbeing Economy Secretary Neil Gray re-affirmed the Scottish Government’s commitment to supporting the completion of the vessels, which remain the quickest way of introducing new lifeline connectivity for island communities.

He also confirmed that a Ministerial Written Authority was issued in order to enable work on vessel 802 to continue. Without such authority vessel 802 would have to be re-procured and deployment of a new ferry potentially delayed for at least two-and-a-half years. He also made clear his expectation that the management of the yard would continue to scrutinise and bear down on future costs.

The commitment will support a sustainable future for Ferguson Marine and commercial shipbuilding on the Clyde, protecting highly skilled jobs while creating opportunities for future generations.

Mr Gray said:

“Our island communities deserve to be supported by two new, energy efficient vessels with the capacity and reliability required to support vibrant island economies.

“While I accept the pure value for money assessment on vessel 802 is challenging, this narrow calculation does not take into account the added delays, the wider benefits of continuing the vessel’s build at Ferguson Marine or the full cost of not doing so.

“If written authority to complete vessel 802 at Ferguson’s was not provided, we could be looking at a delay in deploying a new vessel to May 2027 at the earliest – four years from now and two-and-a-half years after 802 is due to be delivered. I do not consider that it is acceptable to ask our island communities to wait this further period. Also, the due diligence assessment cannot take into account the impact of withholding investment on the Inverclyde and wider Scottish economies.

“While the impact on our island communities and on our economy are not covered by the value for money assessment, they have guided the decisions I have taken, which recognise the broader social and economic benefits of completing both ferries and ensuring the yard continues to have a strong platform upon which to progress and prosper.”

Background

The Cabinet Secretary’s statement to Parliament.

The request for Written Authority and the Cabinet Secretary’s response.

The value for money assessment contains commercially confidential material.

Public Finance and Accountability (Scotland) Act 2000 (legislation.gov.uk)

Since devolution there have been five occasions where Accountable Officers for parts of the Scottish Administration have sought written authority.