John Swinney confirms giving botched ferries fiasco contract 'budget approval'

John Swinney has denied giving the "final nod" to the botched ferries fiasco contract, but confirmed he did give it "budget approval".

The Deputy First Minister faced questions over the Ferguson shipyard debacle after new emails were published by the Scottish Government.

A spokesman for Nicola Sturgeon later said Mr Swinney was not aware of the financial risks associated with the contract.

Deputy First Minister John Swinney. Photo by Jeff J Mitchell/Getty Images

It came as a Scottish Government blunder meant a redacted reference to legal advice in the newly-released documents could be read by simply copying and pasting the text.

It showed ministers were warned of "significant procurement risks" relating to the contract and were told: “The impact of a successful legal challenge could be high – in the worst case the contract could be declared ineffective – and a challenge could be brought at any time as the contract terms are not being made public.”

There has been an ongoing row over the construction of two CalMac ferries, the Glen Sannox and the as-yet-unnamed hull 802, which are at least £150 million over budget and five years’ late.

A recent report from Audit Scotland found there was "insufficient documentary evidence" to explain why the contract to build the vessels was given to the Ferguson shipyard in Port Glasgow, which has since been nationalised, without a full refund guarantee.

An email trail released on Wednesday showed former transport minister Derek Mackay, who resigned in disgrace in 2020, signed off on the contract on October 9, 2015.

However, it also pointed to the involvement of Mr Swinney, who was then finance secretary.

Later that same day, an official wrote: “Just finished my call with DFM. He now understands the background and that Mr McKay [sic] has cleared the proposal. So the way is clear to award.”

During First Minister's Questions on Thursday, Scottish Tory leader Douglas Ross pushed for Mr Swinney to make a statement “to hear why he forged ahead with the deal that has cost taxpayers a quarter of a billion pounds”, adding there was a “stench of cover up and corruption” around the issue.

He also highlighted the redaction blunder, and insisted it showed SNP ministers “ignored a stern warning that this disastrous contract could be challenged in court and declared ‘ineffective’".

Speaking to journalists afterwards, Mr Swinney said: “As finance secretary at the time, I’m responsible for providing the budget for the meeting of any contracts.

“What officials were doing was briefing me that there was no need to change the budget arrangements based on the contract that had been agreed and approved by the transport portfolio, and which, of course, is confirmed by the email trail you got yesterday.”

Asked if he gave it the nod, Mr Swinney said: “What I gave was the budget approval, which I had given in August.

“And the budget approval I gave in August of 2015, the officials assured me on October 9 did not need to be changed."

He added: “The finance secretary does not approve all contracts. If that was the arrangement there would be significant inefficiency in the processing of contracts within government.”

Asked if he would give a statement to Parliament to clear the matter up, Mr Swinney said: "I don't think there's anything that needs to be cleared up, or anything that needs to be added to what the First Minister said quite clearly."

He insisted he "didn’t give [the contract] the final nod", adding: “I was given assurance that the budget provision that I had put in place in August was adequate for the contractual arrangements.”

Asked if he could have withdrawn budget approval, Mr Swinney said: "If I had done that, that would expose the Government to legal and financial risk, because we've embarked on a procurement process in good faith."

A spokesman for the First Minister said it was his "understanding" Mr Swinney was not made aware of the financial risks.

On Wednesday, Audit Scotland said there “remains insufficient documentary evidence to explain why the decision was made to proceed with the contract, given the significant risks and concerns raised by CMAL”, the government ferries agency.