Contracts at ferries shipyard could be reviewed to axe bonuses, MSPs told

Contracts at the shipyard where two delayed and overbudget ferries are being constructed could be renegotiated to prevent bonuses being paid to staff, a senior member of the Scottish Government has said.

Wellbeing Economy Secretary Neil Gray said while there are “contractual obligations” regarding bonus payments to staff at the Ferguson Marine yard in Port Glasgow, there is now a “process ongoing” to see if these terms can be changed.

There was an outcry after six senior members of staff at the yard were awarded a total of £87,000 in bonuses in 2021-22, despite work on two new ferries for CalMac running several years late and about three times over budget.

In April, First Minister Humza Yousaf said he had “made it clear there should be no bonuses paid” in relation to the two vessels.

Questioned on the issue by MSPs on Holyrood’s Public Audit Committee on Thursday, Mr Gray said: “I think the Government has been very clear in terms of our view of performance-related bonuses.

“We have made very clear to the yard our displeasure at there having been, and any likelihood of any future, bonuses.

“There is a process ongoing about whether or not those contracts can be renegotiated in order to see those removed, and I hope that can be the case.

“Because I share the upset and the anger colleagues in this committee, colleagues in Parliament and people in Scotland will have around these bonuses being paid when there has been such delay and such cost overruns on this project.”

He also told MSPs that one of the ferries currently being built, the Glen Sannox, is “very close to completion”.

He was forced to provide written authority for Fergusons to continue work on the second ship, the as-yet-unnamed hull 802, after a report found doing so would not be value for money.

Asked if that report would be made public, Mr Gray said doing so would put the future of the shipyard in jeopardy.

He told the committee: “There was a decision taken in Government jointly by officials and ministers that the commercial sensitivity of the information within there, it would not be appropriate to release that report.

“There’s nothing in there to hide. There is no issue with the numbers, that is not the problem at hand. It is the commercial sensitivity of the report… it makes it difficult for us to release that.

“We don’t want to put the competitiveness of the yard at risk. But putting it in the public domain absolutely would, and would jeopardise the future of the yard.”

Committee convener Richard Leonard asked Mr Gray if he had “vetoed the release of that report”.

The minister said it was a “collective decision taken in Government” not to publish the study – which is estimated to have cost £620,000 to prepare.

He added: “The report and its contents are commercially sensitive, they would put the competitiveness of the yard at risk, and so it would not be appropriate for us to release it.”

He told the committee scrapping work on 802 and starting the procurement process again from scratch would mean a delay until May 2027 in getting a new ferry for the islands.

Mr Gray, who is originally from Orkney, added: “Our island communities have suffered significant disruption, as an islander myself, someone who was born and brought up on an island, I know how difficult a time that will have been for people in the isles.

“I am very acutely aware of the need to deliver these vessels as quickly as possible.”