The Scottish Government has reached an agreement with administrators to take the Ferguson Marine shipyard in Port Glasgow into public control. The agreement will enable completion of the two ferries being built there for Caledonian Maritime Assets Ltd (CMAL). It will also ensure work continues towards delivery of the other vessels currently under construction and secure a future for the yard through continuity of employment for the workforce. This follows two years of extensive discussions with partners to try and find a workable commercial solution.
Economy Secretary Derek Mackay visited the yard this morning to speak to the workforce and outlined the Scottish Government’s commitment to achieving the best possible outcome for the yard. He also met with the newly-appointed turnaround director who will take forward steps to stabilise the business and support the recruitment of an incoming management team, including a Chief Executive Officer.
Mr Mackay said: “We have always been clear that we want to complete the vessels, secure jobs and give the yard a future. I am here today to ensure that we hit the ground running in making that happen and to reassure Ferguson’s excellent staff of the government’s commitment.
“Public control will provide much-needed continuity of employment now and ensure the completion of the CMAL ferry contracts at the lowest possible cost to the taxpayer. It is absolutely essential that the outstanding contracts to build these two ferries are completed in order to sustain the Clyde and Hebrides Ferry Services network and provide vital support for the economies of our island communities.
“The alternative was for the government to stand aside while the company went into administration, resulting in the jobs being lost and the vessels not being completed. That was not an outcome I was willing to consider.
“We are now working to put in place a management team which will refocus all efforts on completing this vital government contract. We will also be working closely with staff and the trades unions – as well as suppliers and customers – to achieve the best possible outcome for the yard.”
GMB Scotland Organiser and CSEU Scotland Chair, Gary Cook, said:
“Nationalisation secures the immediate future of the yard and that is a very welcome development, particularly after all the recent uncertainty.
“Our members were caught in the middle of a situation that had nothing to do with them and their relief will be palpable. It is five years since the yard went bust and the Scottish Government has prevented that from happening again.
“We can now look to the future and everyone should do so with a sense of purpose. With vision and competency we can get on with building the ships Scotland needs and together we can grow jobs and prosperity on the lower Clyde.”
Unite Scottish Secretary, Pat Rafferty, said:
“Unite fully supports the actions of the Scottish Government to intervene and nationalise Ferguson Marine shipyards. It’s clear at this stage that nationalisation was the only serious option on the table to save the yard and more than 350 highly skilled jobs. The Scottish Government have rightly acknowledged their obligations to the workforce, and the people the ferries would serve which must be acknowledged.
“Unite also welcomes the fact that the trade unions have been fully engaged in this process so far. This must remain the case going forward to ensure that the ferries on the existing contract become operable and future contracts can be secured. The yard can have a very successful future and we must all now play our part to make sure this happens.”
The Scottish Government is operating the yard under a management agreement with the administrators while the yard sale process is completed. As part of the agreement entered into with the administrators, the Scottish Government will acquire FMEL at the end of that process should no viable commercial offer be forthcoming during that period. This process is expected to last up to four weeks and will include the administrator undertaking a market testing exercise.
There are around 300 employees at the yard (including permanent, temporary and contract workers). Developing a revised cost analysis to establish the actions required to complete the two CMAL vessels will be one of the main tasks going forward. The routes that the two CMAL vessels will serve will be Ardrossan to Brodick and Uig to Tarbert and Lochmaddy. While the CMAL vessels are completed the Scottish Government will conduct further work to identify a viable future structure for the yard.The Scottish Government will at all times remain open to discussions with any parties interested in securing a viable commercial future for the yard.
Turnaround Director Tim Hair is a qualified Marine Engineer and a member of the Institute of Marine Engineering Science & Technology. He spent his early career working at sea as an Engineer Officer. Since then Mr Hair has worked in a range of industrial business, specialising in transformational change, and he has a track record of stabilising companies in difficult situations. Mr Hair has a wealth of experience across a range of sectors including oil & gas, manufacturing, aerospace and the automotive sector.