Billionaire Jim McColl has revealed that Nicola Sturgeon publicly announced the £97 million price tag for two CalMac ferries before cost negotiations with his shipyard were completed.
The First Minister was dragged into the scandal over the spiralling costs of the two vessels when Mr McColl gave evidence to Holyrood on Wednesday.
Mr McColl, who is one of Ms Sturgeon’s economic advisers, called for a public inquiry into the construction of the two ferries destined for the Hebridean and Clyde routes.
The entrepreneur said his Ferguson Marine shipyard was then “stuck” with the £97 million price tag, even though the firm had been holding out for £103m.
Ms Sturgeon’s role emerged as Mr McColl launched a scathing attack on the first minister and her ministers’ failure to get a grip on the crisis.
Mr McColl went as far as accusing Finance Secretary Derek Mackay of defaming Ferguson Marine management during a Holyrood statement that was highly critical of their handling of the project.
Since the First Minister’s announcement that Ferguson Marine would build the ferries, their cost has soared to around £250 million and their completion dates have been repeatedly delayed.
Appearing before MSPs on Holyrood’s rural economy committee, Mr McColl agreed that the contract signing had been rushed.
Ms Sturgeon announced that Ferguson’s would be building the boats in August 2015 on a visit to the yard which coincided with a visit to Faslane by then Chancellor George Osborne to announce £500m for the nuclear base.
“I think this should be going to a public inquiry because this is a mess that is not going get any better.”
— Jim McColl
Mr McColl also lambasted CMAL, the state-run ferry body, saying there had been “complete hostility and intransigence” from the organisation and suggested it wasn’t needed.
The billionaire said he was unable to see how the project could be completed for less than £100m.
“Before we agreed the negotiation, the First Minister had announced we had been selected as preferred bidders and that the price was £97 million or £96.8m,” Mr McColl said. “CMAL came back to us and said it has been announced by the First Minister, you’ll just have to accept it.”
Mr McColl claimed hundreds of design changes imposed by CMAL led to costs soaring.
Addressing MSPs, he also took issue with a report into Ferguson carried out by Tim Hair, who was brought in to turn around the yard after it was nationalised by the Scottish Government.
‘Scandalous claims’
The report – which highlighted poor record management, a lack of control over sub-contractors, construction and design – was part of a Holyrood statement made by Mr Mackay last year.
Mr McColl described them as “scandalous claims”, adding: “It is misleading, grossly misleading – and I think it is appalling that we had a minister stand up in parliament and defame management by waving this report in the air.”
The businessman’s frustration extended to Ms Sturgeon and Mr Mackay’s failure to help repair Ferguson Marine’s relationship with CMAL.
He raised the difficulties with Ms Sturgeon, Mr Mackay, John Swinney and transport ministers, but there was “no direct action to make it happen”. Meetings were arranged but he accused ministers of being “passive”.
Jim McColl says he raised broken relationship with CMAL over ferries with first minister, finance secretary, deputy fm, business secretary and transport ministers, but they were "passive" about it.
— Tom Peterkin (@TomPeterkin) February 5, 2020
Key Scottish Government documents on the project were missing, claimed Mr McColl, who added: “I think this should be going to a public inquiry because this is a mess that is not going get any better.”
During a meeting with Mr Mackay in June 2018, Mr McColl insisted there should be an independent witness process in a bid to resolve Ferguson’s dispute with CMAL.
According to Mr McColl, the finance secretary then asked his officials to leave the room. Mr Mackay said he was unable to do what Mr McColl wanted because CMAL had sent him a legal letter threatening that the board would quit.
“The First Minister, her finance secretary and a raft of SNP ministers must be properly held to account over their gross incompetence and negligence.”
— Tory transport spokesman Jamie Greene
“I think the term he (Mr Mackay) used at the time was that if I continue to unduly influence them as an independent board they will resign en masse and they will make it public why,” Mr McColl said. “Now what could that be? Maybe the board felt they were under pressure to award it to us, but we certainly weren’t aware of that at the time.
“Why would that (an independent witness process) be refused by the cabinet secretary of finance? What was he scared of? I don’t know to this day what it is but we have suffered the consequences of it.”
Tory transport spokesman Jamie Greene supported calls for a public inquiry.
“The plot thickens with every piece of evidence this inquiry hears. SNP ministers from the First Minister down are mired in this shambles,” Mr Greene said.
“The First Minister, her finance secretary and a raft of SNP ministers must be properly held to account over their gross incompetence and negligence.”
Background: The makings of a ferries fiasco
As one of the last commercial shipbuilders on the Clyde, it was big news when Ferguson Marine went bust on August 15 2014.
Campaigning for the independence referendum was at its height when Jim McColl, the hugely successful Clyde Blowers businessman, rescued the Port Glasgow yard.
Mr McColl, a prominent Yes supporter, stepped in as a result of a deal brokered by then First Minister Alex Salmond.
Initially things went well and the workforce at Ferguson Marine Engineering Ltd (FMEL), as it became known, rose from about 70 to 350.
Then Nicola Sturgeon announced that Ferguson would be the preferred bidder for two new ferries required by Caledonian Maritime Assets Ltd (CMAL), the publicly owned body which has responsibility for Scotland’s ports and ferries.
The first ferry Glen Sannox – destined for the Arran route – came off the slipway in November 2017 and was expected to enter service in mid-2018 but has yet to be completed.
The second ferry, currently known as Hull 802, earmarked for the Skye, Harris and North Uist route, is also unfinished.
As costs spiralled, Ferguson Marine was given controversial Scottish Government loans of £45 million – £15 million in September 2017 and £30 million in June 2018.
Relations between the firm and CMAL deteriorated and the yard went into administration. Finance Secretary Derek Mackay responded by nationalising the company, which was formally taken into public ownership in December last year.
Shortly afterwards, Mr Mackay confirmed taxpayers would have to fork out around £100m extra to complete the two vessels, blaming the “disastrous” impact of the “failing” previous management.
MSPs have launched their own Holyrood inquiry into the fiasco through the rural economy and connectivity committee.
