Evidence to MSPs

Mackay: ‘I had confidence in ferries deal’

Derek Mackay
Derek Mackay: Ferguson Marine ‘won on quality’ (pic: Terry Murden)

Former SNP transport minister Derek Mackay has told a government committee that he had confidence in the recommendation to proceed with awarding a contract for new CalMac ferries to Ferguson Marine shipyard on the Clyde.

In written evidence on his involvement in the controversial decision he told Holyrood’s public audit committee that the submission had followed the “necessary process, procurement assessment and milestone stages”.

Mr Mackay was transport minister at the time and in a five-page letter to Richard Leonard, the Labour chair of the committee, he said he could not “recall” conversations with other key figures after receiving notice of grave concerns about the inability of Jim McColl’s shipyard to provide a guarantee should the contract default.

Ferguson Marine had “won on quality with an impressive bid”, Mr Mackay said, adding that he had been provided with “sufficient” information to be satisfied it would honour its end of the bargain.

Mr Mackay said: “I was satisfied with the information that was provided at the time, and that all relevant officials had been involved in the submission.”

The two vessels, the Glen Sannox and the as yet unnamed hull 802, were due to be completed in 2018 but have been delayed until at least next year. They are also vastly over budget, with the latest estimated cost at least £250 million.

The Scottish Government provided Ferguson Marine loans worth a total of £45 million in September 2017 and June 2018 – the second of which was awarded despite serious concerns being raised about delays to construction.

Mr Mackay said: “The drawdown would have been in line with the stated purpose and terms of the loans. It also allowed [Ferguson Marine] to retain its workforce as suppliers, and without the loans clearly there would be less progress on the vessels. Again, there would be disputed analysis of progress.”

The yard was later nationalised by government ministers who claimed it needed to be rescued in order to save jobs, a claim recently denied by Mr McColl who said it would have survived without the ferries contract.

Glen Sannox ferry
One of the two unfinished ferries

In his evidence, Mr Mackay insisted: “The option of finding another commercial buyer was also not ruled out, but the public ownership option was the best outcome at the time and the right thing to do in the circumstances.”

Mr Mackay added: “There was a high level of confidence in the yard, which had successfully completed other vessels for the CalMac fleet. There was also an expectation that there would be sufficient monitoring and oversight.”

He said he was first made aware of problems and delays in December 2016, after which he was updated “as appropriate” by officials.

In order to resolve the dispute, he said he “made every effort to take advice, ensure fairness, provide challenge and support to officials, engage with other ministers and request review and independent intervention when necessary”.

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A spokesman for the Scottish parliament said: “The committee will consider the content of the letters, and next steps, when it meets on Thursday.”

Commenting on Mr Mackay’s evidence, Scottish Labour Transport spokesperson Neil Bibby, said: “This evidence doesn’t come close to answering the massive questions still hanging over this dodgy deal.

“There is no clarity whatsoever on why the SNP government were so determined to forge ahead with this contract against any and all warnings.

“The SNP have tried to block scrutiny at every turn and pin the blame on anyone but themselves – but the usual spin won’t cut it.

“Derek Mackay and every other Minister embroiled in this mess must come before the Public Audit Committee and deliver some much-needed honesty.”

Mr Mackay, 44, quit as finance secretary in 2020 over private messages. He now has his own consultancy.

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