Ministers delay new small ferries contract in bid to save £41m

The small vessel replacement programme is viewed as key to the future of the embattled Ferguson Marine shipyard

The small vessel fleet is set to be replaced over the next ten years.

Ministers have delayed the awarding of a contract for a new fleet of small lifeline ferries to next year in a bid to save £41m, it can be revealed.

Finance secretary Shona Robison announced the delay to the small vessel replacement programme in a letter to the finance committee last week. Critics said it was a “hammer blow” for islanders.

The delay also affects the embattled Ferguson Marine shipyard. David Tydeman, the yard’s chief executive, has repeatedly underlined the importance of winning this contract for its future viability.

Social Justice Secretary Shona Robison says violence against women and girls is caused by 'predatory and abusive men, not trans people' (Picture: Fraser Bremner/pool/Scottish Daily Mail/PA)

Ferry procurement body, CMAL, previously told The Scotsman the contract “must get underway by the end of the year as the next priority”, but this has been delayed as the Scottish Government continues to cut budgets in order to break even.

Phase one of the programme will see seven new small ferries for routes such as Oban to Lismore and Mallaig to Armadale be constructed. CMAL and ministers are exploring a potential direct award to Ferguson Marine, the government-owned shipyard which has struggled to build two larger ships, the Glen Sannox and the Glen Rosa, for the CalMac network.

However, £41m has been saved from this year’s budget in connection with this construction programme.

Ms Robison’s letter to MSPs said: “Small Vessels Replacement Programme [SVRP] Phase 1 estimated contract spend has been reprofiled, allowing time to fully consider the business case work, vessels design criteria, and help ensure alignment of the related shore power and port improvement works.”

Ferguson Marine shipyard in Port Glasgow, where two ferries are being built for the CalMac fleet.

Despite this cut, Transport Scotland said the programme remains a “priority for delivery”.

A spokesperson said: “We will continue to make significant investments in our vessels, working with CMAL and the operators to improve reliability and resilience of services as we progress.

“The Outline Business Case for SVRP is nearing completion and is a crucial aspect of the delivery process, ensuring that we deliver not only value for money but also that vessel and shoreside works align.”

Kevin Hobbs, the CMAL chief executive, told The Scotsman in July a decision on the programme was required by the end of the year. He said: "We are not prepared to wait and wait and wait and see the small vessels getting older and older and older off the back of somebody [who] can’t make a decision. That needs to be made in the next three or four months."

However, a CMAL spokesperson said the programme remains “on track” despite the delay, with concept design “now complete”. They added: “Payments will only become due when a shipbuilding contract is signed, which will be during financial year 2024/25.”

David Tydeman, chief executive of Ferguson Marine, said he believes the yard to be a “strong contender” for the contract. However, it is likely such a bid would require a direct award by ministers.

He said: “We believe Ferguson Marine is a strong contender to build small ferries for CMAL, given our ‘on time and on budget’ delivery of vessels of a similar size in the past. We look forward to having an opportunity to prove that we can do so again.”

Critics said the delay was “ominous” for CMAL and Ferguson’s, and would impact island communities.

Graham Simpson, the Scottish Conservative transport spokesperson, said: “Shona Robison’s ‘reprofiling’ might claw back money for the SNP’s financial black hole, but it’s another hammer blow for islanders.

“And it’s ominous news for CMAL and Ferguson Marine, who said getting the small vessels replacement contracts sorted by the end of this year was a priority.

“The SNP have already seen the dire consequences of their neglect, with constant breakdowns in an ageing fleet. Getting that sorted isn’t just urgent. It’s long overdue, and the fact they are kicking it down the road shows utter contempt for those who depend on these vital lifelines.”

Scottish Liberal Democrat spokesperson, Willie Rennie, demanded a parliamentary statement from Ms Robison on the decision to delay the contract.

He said: “Pushing the small vessel replacement programme further down the line makes it even less likely that the shipyard is able to pull together the pipeline of work necessary for it to continue operating.

“The Finance Secretary should come to parliament this week and say whether this cut puts the future of the yard at risk and what the feedback was from Ferguson Marine which she informed them of these changes to the budget.

“Islanders are thoroughly sick of being messed around by SNP ministers who don’'t seem able to offer basic clarity about when the boats they rely on will be replaced.”