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Chamber and committees

Official Report: search what was said in Parliament

The Official Report is a written record of public meetings of the Parliament and committees.  

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Dates of parliamentary sessions
  1. Session 1: 12 May 1999 to 31 March 2003
  2. Session 2: 7 May 2003 to 2 April 2007
  3. Session 3: 9 May 2007 to 22 March 2011
  4. Session 4: 11 May 2011 to 23 March 2016
  5. Session 5: 12 May 2016 to 4 May 2021
  6. Session 6: 13 May 2021 to 8 April 2026
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Displaying 8272 contributions

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Meeting of the Parliament

Points of Order

Meeting date: 29 September 2022

Edward Mountain

On a point of order, Presiding Officer. During topical questions on 6 September, the Minister for Business, Trade, Tourism and Enterprise, Ivan McKee, assured this Parliament that the budget and completion timescales for vessels 801 and 802 were on track. Last night, we were told that the vessels could cost another £84 million, bringing the total cost to £336 million against the budget of £97 million. Furthermore, we were told that vessel 802 will be subject—[Interruption.]

SNP members may be struggling to find this interesting, but the people of Scotland and the people of the islands that I represent find it very interesting, so I suggest that they listen to it.

Meeting of the Parliament

Ferries

Meeting date: 28 September 2022

Edward Mountain

Will the minister give way?

Meeting of the Parliament

Ferries

Meeting date: 28 September 2022

Edward Mountain

Thank you, Presiding Officer. I will bring them to a conclusion.

I do not believe that the Government did not know what was going on. It knew fine well what was going on, and the Parliament has been misled, not only in the committees but in the chamber.

Meeting of the Parliament

Ferries

Meeting date: 28 September 2022

Edward Mountain

We all know that delays cost money, but there is no mention of the extra cost in the letter to the Net Zero, Energy and Transport Committee. Is the Government worried about that, and what will it do in response?

Meeting of the Parliament

Ferries

Meeting date: 28 September 2022

Edward Mountain

First, as the convener of the REC Committee when it produced the report, I can say that the committee certainly was not aware of all the information that is currently being put in the public domain. To say that all that information was available to us and that we could draw conclusions from it is, frankly, wrong.

Secondly, as I understand it, the Net Zero, Energy and Transport Committee is not going to be looking at the procurement of vessels 801 and 802, but at future procurement of ferries and the ferries plan, which the minister has not updated for a considerable time.

Meeting of the Parliament

Ferries

Meeting date: 28 September 2022

Edward Mountain

We need a public inquiry.

Meeting of the Parliament

Ferries

Meeting date: 28 September 2022

Edward Mountain

Thank you, Presiding Officer. I am pleased to be able to rise to speak in this debate.

I will try to address the matter and put some flesh on the bones, because I spent a huge amount of time as convener of the Rural Economy and Connectivity Committee in session 5 looking at the procurement of vessels 801 and 802. I also had the privilege—if you can call it that—of having seen most of the documents on which the BBC based last night’s programme.

I will start off by talking about the contract bid. Let us be clear about this: CalMac gave its requirements to CMAL. They were quite considerable requirements, running to some 400-odd pages. They were not all perfect; in fact, some of them were strange. For example, CalMac asked for passenger cabins on the ferries, when there were to be no passenger cabins on these boats—but there they were, in the document.

That document was then distilled down into a 350-page document that formed the basis of Ferguson’s bid. Interestingly, if you look through it—or if you were able to flick your eyes quickly over it as the BBC were showing it—you will see that single words had been changed. For example, the word “should” had been changed to “will”. CalMac said that it “should” have something, while Ferguson’s said that it “will” have it. That is not really very clever.

What is also not clever is duplicating the errors in the original contract. For example, it was put in that there would be passenger cabins on the ferry, although we know that they were never part of it. We also found out that, as part of the tender process, the boat that was put forward by Ferguson’s was overpriced and overweight.

What I do not understand—and what I will fail to understand until the day I die—is why no one picked that up. Why did no one see that the biggest part of the document, which was about what the ferry would consist of, was pure duplication? The Government is telling us that it did not know, but I am not sure that I can go with that.

Let us look at the builders refund guarantee. In December 2014, Ferguson’s said that it would be incapable of producing a builders refund guarantee. It gave two reasons for that: it was a new business, and it had not developed a relationship with a bank. It said to CMAL in December that it could not do it. That was in the middle of the process, and yet Ferguson’s was able to continue with the process and was eventually awarded the contract—with no refund guarantee.

What does it mean to have no refund guarantee? It means that if everything goes wrong, one person has to pick up the costs. There is only one person who can pick up the costs for that, and it is not CMAL—it is the Scottish Government. If you are telling me that the Scottish Government did not know that it was going to be the lender of last resort when it all went wrong, I, frankly, do not believe you.

I also point out that CMAL was particularly nervous about that, and I am sure that it mentioned the issue to the Government, because it suggested that, as Ferguson’s bought the parts, they would become the property of CMAL and would not belong to Ferguson’s at all. As CMAL paid during the contract, it was taking control of the parts. That is an odd thing to do, so nobody should tell me that CMAL did not warn the Scottish Government. I believe that it must have done.

Then we got to the stage of the retender. Quite simply, the boat that was put forward was the wrong size—it was too heavy and cost too much. What did CMAL do? It said, “Well, you mentioned another boat and said it was no good, but we think it’s an excellent boat and we’d like you to tender on the principle of that.” That is what happened, and that is the boat that ended up being designed. Are people telling me that the Scottish Government did not know that? I do not believe that.

We started off with 15 staged payments and ended up with 18. When there are more staged payments, it probably means that the business that is getting the payments is in trouble and is financially unreliable. What happened then? In March 2017, the yard was nearly bankrupt, so CMAL said that it would release only part of the staged payments to the yard and that, when the yard could prove that the contractors who were owed money had been paid, CMAL would give a bit more of the staged payments. CMAL was trying to deliver the money to the yard and to make sure that the contractors were paid so that the yard did not go into receivership. However, at the same time, Derek Mackay was round the back with a van shoving £15 million into Ferguson’s and then another £30 million, making a mockery of that.

The Government can claim that it did not understand that the yard was close to being bankrupt. I would ask why ministers did not know that, but ministers cannot claim that they did not know that their Government was dishing out unsecured loans to Ferguson Marine.

I am running out of time, but I will look briefly at Tim Hair, who cost us £2 million and was interviewed on the telephone. He came to the business with a lot of knowledge—he had been an engineer on a cruise liner for a couple of years and had never built a ship in his life. It is always said of turnaround directors that, for the first six months of a contract, they are part of the problem and, after that, they become the problem. That is what happened, and that is why we are seeing the delays to the ferries that we are seeing at the moment.

In summary, we understand that crucial financial requirements were waived to allow only one bidder. The tender specification documents were given to only one bidder. The chance to retender and reduce the price was given to only one bidder. The tender happened to be awarded to a loyal Monegasque supporter. Staged payments were adapted to allow money to go into the yard—

Meeting of the Parliament

Ferries

Meeting date: 28 September 2022

Edward Mountain

—and unsecured loans were agreed.

Net Zero, Energy and Transport Committee

Programme for Government

Meeting date: 27 September 2022

Edward Mountain

We agree that there is a need for it. I was concerned that Donald Henderson said to the committee just now that he did not have a timescale for it. I am trying to push you on the timescale.

Net Zero, Energy and Transport Committee

Role of Local Government in Delivering Net Zero

Meeting date: 27 September 2022

Edward Mountain

Thank you. As members have no other questions, thank you very much, cabinet secretary. We will have a brief pause to allow a changeover of witnesses. Thank you to those who are leaving, and thank you to those who are staying.

10:47 Meeting suspended.  

10:54 On resuming—