Meeting of the Parliament

Meeting date: Tuesday, September 27, 2022

Official Report 954KB pdf

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Urgent Question

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Ferries Contract

To ask the Scottish Government what its response is to the claim in a BBC report today that the process for awarding the contract for ferries 801 and 802 may have been rigged.

The BBC’s allegations were first put to me in advance of an interview that I conducted last week as part of a programme that is to be broadcast this evening. Scottish ministers are not aware of any impropriety in the procurement process, but take the claims that have been made extremely seriously. It is important that they are addressed carefully.

As I made clear in my interview, those issues are concerning. I know that the current management teams at Caledonian Maritime Assets Ltd and Ferguson Marine (Port Glasgow) Ltd share that concern. I have already committed to ministers exploring what further steps the Government needs to take to ensure that all questions about the fairness and appropriateness of the tendering process are properly and independently investigated.

I confirm that, at the request of ministers, the permanent secretary has already proactively been in contact with the Auditor General for Scotland to discuss the matter. The Auditor General informed the permanent secretary that Audit Scotland will look at the substance of the allegations around procurement that are raised by the programme before deciding whether further audit work is required. I welcome that, and the Scottish Government, CMAL and Ferguson’s all commit to fully supporting that exercise.

We found out today that the disastrous ferries contract appears to have been rigged in Ferguson’s favour. The new documents appear to show that Ferguson’s received a 424-page report to help its bid; no one else did. Ferguson’s was allowed to change its design at the halfway mark; no one else was. Ferguson’s was able to change its price after the deadline; no one else could. Ferguson’s had a confidential, in-person, meeting; no one else got that.

In short, it appears that Ferguson’s received special treatment that no one else got from this Government and its agencies. That special treatment might have broken laws that could open the Government to legal action. That is a scandal. It looks like corporate corruption, and the fact that we are finding out about it only now means that there has also been a cover-up.

Will the Deputy First Minister tell us who chose to give Ferguson’s special treatment and why the documents that we now know about were kept hidden?

As I indicated in my first answer, there is a lot of material in the BBC report. It was first put to ministers last week and I responded in good faith by giving an interview. I have indicated that there are issues of concern that require exploration and I welcome the comments that have been made this afternoon by the Auditor General, who has said that he will consider what further audit work is required in the light of the points that are raised in the BBC report.

There are issues of concern. I do not believe that it would be appropriate for the level of specific information that the BBC documentary says was available to Ferguson’s to have been made available to the company. It is important for me to place on the parliamentary record that CMAL has made it clear to the BBC that it can find no trace of that document going from CMAL to Ferguson’s. It is important that those points of factual accuracy are put on the record.

In relation to the wider questions that have been raised, that is why I gave a commitment that the new points of detail and information that are raised in the BBC documentary must be explored further. I welcome what the Auditor General said about that today.

It is no use for the Deputy First Minister to hide behind the Auditor General. The claims were put to him last week. I cannot believe that he has been sitting there doing nothing and not finding out what has gone on.

If the Government accepts that what is claimed is wrong, which it appears to do, but does not know how it has happened or who is responsible, it must now call in the police to investigate. If Ferguson’s received special treatment, for whatever reason, that is beyond a scandal and is, in my view, a crime. The alleged rigging of the contract and the potential fraud has cost the country £250 million, and the figure is rising. Will the Government call in the police so that we can finally find out the truth of what has happened?

Mr Simpson asks what I have been doing since the points were put to me. I have been asking the permanent secretary of the Scottish Government to raise the issues with Audit Scotland, thereby enabling Audit Scotland to consider them. Audit Scotland has, of course, already undertaken audit work in relation to the Ferguson’s procurement process and will establish whether any further inquiry is required. That would enable independent scrutiny of the procurement process, which is something that Audit Scotland does on countless other issues and has already done on the Ferguson’s contract.

That is what I have been doing, because I thought that Parliament would want an independent assessment process that allows the issues to be properly considered, so that any appropriate action can be taken as a consequence.

Today’s BBC reports of historical allegations of potential impropriety between CMAL and Ferguson’s during the procurement process are clearly concerning. Will the Deputy First Minister provide assurances about the timescale for full investigation of the matter?

Obviously, we do not want matters of this nature taking an inordinate amount of time to be investigated. If concerns are raised, they should be properly looked into. That is the step that the permanent secretary has taken, on ministers’ behalf, in raising the issue with Audit Scotland.

As I said, I welcome what the Auditor General has said this afternoon to allow independent investigation of the claims that have been made in order to determine what further action is required to be taken.

What is being trailed by the BBC is very worrying, as is the Deputy First Minister’s answer about being unable to find any exchange of documents. The Auditor General struggled to investigate the procurement process previously. What changes has the Deputy First Minister made? What information will he make available to allow the Auditor General to investigate thoroughly? In the interests of full transparency, will he now agree to an independent public inquiry into the whole fiasco and, indeed, to call in the police if corruption is suspected?

In relation to the point that Rhoda Grant puts to me in connection with any further investigation, I have set out to Parliament the steps that we have taken to raise with Audit Scotland the issues that have been put to us, and Audit Scotland has made its own judgment, as it should do as the independent auditing body in Scotland.

In relation to documentation, I remind Rhoda Grant that the Government published a huge volume of material in—if my memory serves me correctly—December 2019, which included all the detail around information that was available on the procurement process and development of the contract with Ferguson’s. As I have indicated in my answers today, the Scottish Government, CMAL and Ferguson’s all commit to fully supporting any investigation that is properly undertaken under the auspices of the Auditor General.

I very much share the concerns that have been expressed by Graham Simpson, Alasdair Allan and Rhoda Grant. We were told by ministers that everything was out in the open and that the Government had nothing to hide, so why is it that we are only finding out about this now? What does it say about the oversight function within this Scottish Government?

As I set out in my answer to Rhoda Grant, the Government published a huge volume of material in 2019, which covered all aspects of the procurement process. Obviously, specific points have been raised with us about information to which Ferguson’s had access, which ministers did not previously know was the case. That is why we have taken the steps that we have taken in raising the issues with Audit Scotland today to enable it to make a judgment about the issues that are raised in the BBC documentary.

The Government wants to make sure that any question that is raised in this regard is properly and fully considered as part of the analysis that should properly be undertaken on the awarding of a contract, if concerns of this type are raised.