Friday, August 16, 2019

Scottish Government Nationalises Shipyard to Ensure Lifeline Freight and Passenger Ferries Completed

Port Glasgow Group Deal Delights Transport Unions
Shipping News Feature
UK – The troubled Ferguson Marine Engineering shipyard in Port Glasgow has been taken into public ownership after the Scottish Government agreed to nationalise it following two years of extensive discussions with partners to try and find a workable commercial solution to its demise. The agreement ensures that the two ferries being built there for Caledonian Maritime Assets Ltd (CMAL), and scheduled to supply lifeline island freight and passenger services, will be completed.

The government says the deal 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 week saw a meeting between Economy Secretary Derek Mackay and the newly-appointed turnaround director, Tim Hair, with a view to appointing a CEO and new management team. Mr Mackay said:

“We have always been clear that we want to complete the vessels, secure jobs and give the yard a future. 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.”

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 the company 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, many of whom are represented by the Unite and GMB unions, GMB Scotland Organiser and CSEU Scotland Chair, Gary Cook, commented:

“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.”

The government has a vested interest in the future success of the CalMac services to the islands which sit off the Scottish coast. Calmac, like the CMAL operation is a publicly-owned private company of which the Scottish Government is the only shareholder. The vital services provided to the outlying communities make them a special case in the eyes of the government, a situation several union interests traditionally find most acceptable, as again in this case, of which Unite Scottish Secretary, Pat Rafferty, observed:

“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.”

Photo: Ferguson’s in its heyday.