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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. Current session: 13 May 2021 to 30 November 2025
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Public Audit Committee

Section 23 Report: “New vessels for the Clyde and Hebrides: Arrangements to deliver vessels 801 and 802”

Meeting date: 28 April 2022

Richard Leonard

Item 3 is the continuation of our evidence session with the Auditor General and his team on the report into new vessels for the Clyde and Hebrides. We are pleased to welcome back the Auditor General, who is joined again by Angela Canning and Antony Clark. I thank them for coming back so quickly to help us keep the momentum of our scrutiny going.

Auditor General, you gave an opening statement last week and I will not ask you to repeat that. With your forbearance, I will move straight to questions.

Rhoda Grant is also joining us again remotely. If she wants to come in, she should indicate that via the chat function and we will attempt to bring her in.

I will begin by recapping a couple of areas from last week and seeking a bit more clarity. In the evidence that you gave last week, Auditor General, you said that we

“do not know on what basis”

ministers agreed to take the risk of placing the order for vessels 801 and 801 with Ferguson Marine Engineering Ltd on the basis of a non-standard contract. You said that

“there is no documentary evidence of how those risks were considered or how it was intended that they would be managed during the running of the contract”—[Official Report, Public Audit Committee, 21 April 2022; c 28, 27.]

I ask you to reflect on something that the First Minister said to Parliament on 24 March. When asked about documentary evidence, she said:

“Many of the documents that relate to the decision have been in the public domain for some time. They clearly narrate the issue of the lack of a full-refund guarantee. They also clearly narrate the mitigations that were put in place to reduce that risk.”—[Official Report, 24 March 2022; c 11.]

Please give your comments on the view expressed by the First Minister.

Public Audit Committee

Section 23 Report: “New vessels for the Clyde and Hebrides: Arrangements to deliver vessels 801 and 802”

Meeting date: 28 April 2022

Richard Leonard

I was going to turn to that next.

In the light of the questioning of the First Minister last Friday, a Scottish Government official was reported to have said:

“A thorough search has been conducted and the ... documentation cannot be located.”

On Tuesday, that was confirmed in the Parliament by the Minister for Business, Trade, Tourism and Enterprise, who said that, following “a thorough search”, the documentation could not be located.

I turn to section 24 of the Public Finance and Accountability (Scotland) Act 2000, which, I am reminded, is headed

“Access to documents and information”.

The 2000 act is fairly clear that, for a section 23 report such as this one, the examiner from Audit Scotland is entitled under section 24(3)(a)

“to ... have access at all reasonable times to any document in the possession, or under the control, of the body or office-holder in question which the examiner may reasonably require”.

It appears that that document does not exist. However, the 2000 act goes on to say under section 24(3)(b) that the examiner is entitled

“to ... require from any person holding, or accountable for, any such document any assistance, information or explanation which the examiner reasonably thinks necessary”.

Does that cover information and explanation as to why documents do not exist?

Public Audit Committee

Section 23 Report: “New vessels for the Clyde and Hebrides: Arrangements to deliver vessels 801 and 802”

Meeting date: 28 April 2022

Richard Leonard

Okay, Mr Clark, I will leave the redresses to you or the Auditor General. Did you get an explanation as to why that documentary evidence did not exist?

10:00  

Public Audit Committee

Section 23 Report: “New vessels for the Clyde and Hebrides: Arrangements to deliver vessels 801 and 802”

Meeting date: 28 April 2022

Richard Leonard

That brings us to the end of the time that we have this morning. Once again, Auditor General, I thank you for your willingness to answer the wide range of questions that we have put to you. I also thank the team that has joined you. We very much appreciate the input of Antony Clark and Angela Canning, which has been illuminating.

We will have to consider what our next steps are. You have given us some suggestions on where it might be useful for us to look further. We will reflect on those and, as a committee, we will reach our own conclusions on our next steps. I thank you again for your evidence.

We now move into private session.

11:16 Meeting continued in private until 11:53.  

Public Audit Committee

Section 23 Report: “New vessels for the Clyde and Hebrides: Arrangements to deliver vessels 801 and 802”

Meeting date: 28 April 2022

Richard Leonard

Okay, so we do not know whether the Government is searching for something that exists.

Public Audit Committee

Section 22 Report: “The 2020/21 audit of NHS Highland”

Meeting date: 28 April 2022

Richard Leonard

Rhoda, do you have any further questions?

Public Audit Committee

Section 22 Report: “The 2020/21 audit of NHS Highland”

Meeting date: 28 April 2022

Richard Leonard

That brings the evidence session to a close. I thank Boyd Robertson for his opening statement, which was very useful in framing our session. I thank David Garden, director of finance, for his input, which has been valuable, and I particularly thank Pam Dudek, the chief executive, who has fully, comprehensively and candidly answered the questions that we put to her.

We will suspend briefly to allow for a changeover of witnesses.

09:50 Meeting suspended.  

09:52 On resuming—  

Public Audit Committee

Section 23 Report: “New vessels for the Clyde and Hebrides: Arrangements to deliver vessels 801 and 802”

Meeting date: 28 April 2022

Richard Leonard

You mentioned the turnaround director. Do you, as Auditor General, have a view on the contractual arrangements and terms of engagement of the turnaround director? I do not think that that is included in your report, but I wondered whether you have had a chance to reflect on it.

Public Audit Committee

Section 23 Report: “New vessels for the Clyde and Hebrides: Arrangements to deliver vessels 801 and 802”

Meeting date: 28 April 2022

Richard Leonard

That might be a line of inquiry that we will pursue elsewhere. Thank you. I now invite Craig Hoy to ask a series of questions.

Public Audit Committee

Section 23 Report: “New vessels for the Clyde and Hebrides: Arrangements to deliver vessels 801 and 802”

Meeting date: 28 April 2022

Richard Leonard

We have heard this morning about how people have applied to court to get settlements in disputes about payments, we have heard about mediation mechanisms being considered and then abandoned, and we are looking at a new environment in which there is a cost-plus arrangement. If you read the evidence that Jim McColl submitted to the committee, you find that a lot of it is saying that we are looking at the situation through the wrong end of the telescope, that unfair demands were placed on Ferguson Marine, and that that is why the costs and delays ended up where they did. That is all because of CMAL, which is now the technical consultant in an environment in which there is a cost-plus arrangement. In looking out for the public’s money, how do we know that that is not a blank cheque for CMAL to get the highest specification and technical corrections that will cost an inordinate amount of money on which there is no limit?