Ex-Scottish transport minister admits ‘catastrophic failures’ over ferry purchase

The former minister responsible for a ferry procurement that led to the collapse of Scotland’s last commercial shipyard and disrupted island economies has admitted to “catastrophic failures” in the process.

Giving evidence to a Holyrood committee investigating the affair, Derek Mackay said he took his “share of responsibility” over the Scottish government’s decision to award Ferguson Marine Engineering a £97mn contract in October 2015.

The company, which owned Ferguson Marine on the river Clyde, was due to deliver two ferries for use between the Scottish mainland and islands including Arran in 2018. But it collapsed into administration in August 2019, prompting the Scottish government to nationalise the yard.

The “dual-fuel” ferries — able to run on both marine diesel and liquefied natural gas — remain under construction, plagued by escalating costs.

Opposition parties have criticised the Scottish National party administration’s handling of the affair, with Douglas Ross, leader of the Scottish Conservatives, telling MSPs on Thursday that the ferry project had been a waste of £250mn.

The Scottish government this week said it would have to cut about £500mn of spending to pay for measures aimed at supporting people amid the cost of living crisis. These included above-budget wage settlements for civil servants.

“The committee has identified procurement and management failures, catastrophic failures, and of course I take my share of responsibility,” said Mackay. “However, in doing so, I believe that at every stage and in every decision, I acted with the best of intentions.”

Asked whether he had been pushed to award the contract to Ferguson Marine, which was owned by Jim McColl, formerly an economic adviser to the Scottish government, Mackay denied there had been any political pressure. He said the yard’s nationalisation had been motivated by a need to guarantee its future and protect jobs.

He added that he could not imagine that the first minister would have been personally involved “beyond what her ministers were doing”.

The government has faced criticism over when it knew that Ferguson Marine would struggle to deliver the high-tech ferries.

“Nobody was ever compromised on that matter”, said Mackay, adding that the decision to award the contract to Ferguson Marine was based on the strength of its bid. The risk of lateness and poor performance was seen as low and “there was confidence in the yard”, he said.

Responding to Ross on Thursday, Sturgeon said that although she regretted the cost overruns, she did not “regret the actions this government took to save the Ferguson shipyard and to ensure that those working there still have a job”.

“That is important and of course we will continue to take action to ensure that the two ferries are completed.”