Scotland business

Government ferry firm hits back in £97m contract row

Launch of the UK's first LNG passenger ferry Image copyright Mark F Gibson
Image caption The delayed ferries are at the centre of a row between Ferguson Marine and the Scottish government's ferry company Caledonian Maritime Assets Ltd

The public body that owns Scotland's ferries has hit back in a row over a contract to build two new CalMac vessels.

Ferguson Marine has claimed it will lose £40m on the delayed deal, blaming "interference" by the Scottish government's ferry company.

But Caledonian Maritime Assets Ltd (CMAL) said only around £1.45m in extra costs have been incurred.

CMAL's Kevin Hobbs described the row as "sad and distressing".

Mr Hobbs, chief executive of CMAL said delays to the £97m fixed-price contract means "considerable stress" is being put on the vessels currently operating on CalMac's Clyde and Hebridean routes.

In an interview with the magazine for members of the Institute of Directors Scotland, Mr Hobbs said: "It's been very sad and distressing for the communities, CalMac and CMAL.

"This is a very large and prestigious order and should have helped showcase a Scottish shipyard. Sadly, it's done anything but.

"We have not changed the tender specification.

"We built in a contingency for changes to the vessels' design and build of 3% of the entire £97m budget - it works out as around £2.9m. So far we've spent around half that amount on minor changes.

"They knew the requirements and what was needed from the vessels, their speed, capacity, dimensions... none of those have changed.

"It's so very sad and distressing that the contract has ended up like this, it's not to the benefit of Scotland or the shipyard."

Image caption The Scottish government has loaned a total of £45m to the shipyard

CMAL buys and leases the CalMac ships on behalf of the Scottish government and ordered the two vessels, which are fuelled by both liquified natural gas and marine oil, to meet growing demand on the country's ferry network.

BBC Scotland business and economy editor Douglas Fraser has blogged on the troubled contract.

They were meant to be delivered last year but a public row over the contract specifications has since ensued.

In its latest accounts - which were filed over a year late - Ferguson Marine stated that it will lose £39.5m on the deal and that its directors "believe that post contract award, variations, interference, and disruption caused by the customer have resulted in additional unforeseen costs".

Image copyright Ferguson Marine

The Inverclyde yard has been given access to a total of £45m in Scottish government loans and launched a compensation claim against CMAL earlier this month.

'Considerable stress'

Mr Hobbs said delays to the two new vessels and increased demand for ferry travel in Scotland was putting pressure on the CalMac network.

He added: "These two ferries should have been in service last summer, allowing us to withdraw existing vessels which are getting old.

"We're putting considerable stress on two vessels that should have been retired off by now, or used as replacements elsewhere on less demanding routes.

"We are doing more with our current fleet than we've ever done before but we run the risk of pushing it too hard."

A spokesman for Ferguson Marine said: "Having welcomed the Scottish government's encouragement for both parties to find a resolution, our focus at this time is to concentrate efforts to make that happen."

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