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Official Report: search what was said in Parliament

The Official Report is a written record of public meetings of the Parliament and committees.  

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Dates of parliamentary sessions
  1. Session 1: 12 May 1999 to 31 March 2003
  2. Session 2: 7 May 2003 to 2 April 2007
  3. Session 3: 9 May 2007 to 22 March 2011
  4. Session 4: 11 May 2011 to 23 March 2016
  5. Session 5: 12 May 2016 to 4 May 2021
  6. Session 6: 13 May 2021 to 25 March 2026
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Displaying 133 contributions

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Public Audit Committee

Section 23 Report: “New vessels for the Clyde and Hebrides: Arrangements to deliver vessels 801 and 802”

Meeting date: 4 November 2022

Nicola Sturgeon

Indeed.

Public Audit Committee

Section 23 Report: “New vessels for the Clyde and Hebrides: Arrangements to deliver vessels 801 and 802”

Meeting date: 4 November 2022

Nicola Sturgeon

I assume so. Ultimately, I do not end up at places, making announcements, unless I have agreed to do so. If it was in the way that these things happen, it would have come to me as a proposal that, because of the nature of the announcement, it was appropriate for me to do it, and I would have agreed. Obviously, it is common sense to say that I must have agreed to that, because otherwise I would not have been there, making the announcement.

Public Audit Committee

Section 23 Report: “New vessels for the Clyde and Hebrides: Arrangements to deliver vessels 801 and 802”

Meeting date: 4 November 2022

Nicola Sturgeon

It was several years ago, so I will not say that I can tell you the exact sequence of events from memory, but, in the normal course of events—I have no reason to believe that it would have been different here—it is unlikely that I would have instigated it, because I would not necessarily have had knowledge that it was coming up on that date. It would have come to me as a proposal, and such proposals come to me regularly. The Government makes announcements—if not every day, then regularly, several times a week—and in all of those there will be a process of judgment about who is the right person to make the announcement. When the judgment is that it should be me, that will come to me as a proposal, and I am pretty certain that that is what would have happened here.

Public Audit Committee

Section 23 Report: “New vessels for the Clyde and Hebrides: Arrangements to deliver vessels 801 and 802”

Meeting date: 4 November 2022

Nicola Sturgeon

If there are any points beyond those answers that the committee wants to explore, that is obviously why I am here today.

Public Audit Committee

Section 23 Report: “New vessels for the Clyde and Hebrides: Arrangements to deliver vessels 801 and 802”

Meeting date: 4 November 2022

Nicola Sturgeon

I am the First Minister. You can—

Public Audit Committee

Section 23 Report: “New vessels for the Clyde and Hebrides: Arrangements to deliver vessels 801 and 802”

Meeting date: 4 November 2022

Nicola Sturgeon

Mr Hoy, as has been reflected in the exchanges that we have just had, a key driver for the Scottish Government all along has been protecting employment at the shipyard. You have rightly probed me about the decision around nationalisation and, understandably in the circumstances, you have questions and scepticism about whether that was the right decision. However, I repeat that, without that decision, people would have lost their jobs. A key driver of the Scottish Government has been to protect employment, and I make no apology for that.

11:15  

I was not party to your discussions at the yard earlier this week, but we have made no commitment to additional funding for the vessels since March 2022. The chief executive of what is now Ferguson Marine Port Glasgow wrote to the portfolio committee with an assessment of the cost to complete the vessels and the latest update on delivery timescales. That is still under scrutiny by the Scottish Government, with input from legal shipbuilding technical advisers, and we will come to a view on it in due course.

Beyond those vessels, of course we want to support the shipyard to reach a position in which it is a viable proposition that can successfully bid for and win contracts, and I think that the shipyard is closer to that now than it has been in recent history. That goes beyond the particular issues around the vessels that we are discussing.

Public Audit Committee

Section 23 Report: “New vessels for the Clyde and Hebrides: Arrangements to deliver vessels 801 and 802”

Meeting date: 4 November 2022

Nicola Sturgeon

Buying the yard?

Public Audit Committee

Section 23 Report: “New vessels for the Clyde and Hebrides: Arrangements to deliver vessels 801 and 802”

Meeting date: 4 November 2022

Nicola Sturgeon

I absolutely accept Audit Scotland’s view of the issue around the recording of that decision. We will reflect on that and look at Audit Scotland’s views about any lessons that should be learned on the recording of decisions.

I will make two points about that. First, what happened with the construction of the vessels did not happen because a decision was not recorded in a particular format. It happened for a variety of reasons that, no doubt, we will come on to talk about. It is important to recognise that.

Secondly, had there been a fuller response from Derek Mackay—I say this from my now fairly lengthy experience of government—it would just have repeated what was in the submission as the basis for the decision. The shorthand is, “I approve it,” and the implication is that it is approved on the basis of all the mitigations that are set out. Often, the lengthier responses that a minister gives are given when they go against what is in a submission.

Yes, of course we will reflect on the matter. I am sure that the committee does not need me to give it advice on any aspect of its inquiry, but it would be fundamentally wrong to say that, because a decision was recorded in shorthand as opposed to repeating verbatim what was in the submission, it is somehow the cause of what happened since.

Reflecting on lessons learned will, obviously, be an on-going process as we complete the vessels. I am absolutely determined that the Government properly and fully learns all lessons that are appropriate. I do not know what stage the committee is at in its considerations or when we might get a report out of its deliberations, but we will properly feed that into the lessons learned process as well.

I can write to the committee in more detail about this in the interests of time if you want, but CMAL has already made changes to its procurement processes. It will require a full builders refund guarantee in future for major vessel contracts, has enhanced the financial due diligence that it does on all contracts over £500,000, will use a ship broker to provide assurances on the yards that are bidding for vessels, will have an independent panel member on vessel procurements and will use naval architects to work alongside its in-house team on technical assessments.

Transport Scotland has already made considerable changes to governance on vessel procurement. For example, it has made changes to the accountable officer template and to the scrutiny and sign-off of vessel and port projects. Its investment decision-making board is now involved in that process, which was not the case when the contracts were awarded.

The Scottish Government has also strengthened its approach in general terms to any strategic interventions that it makes in commercial assets. Back in, I think, March this year, we published the business investment framework as part of the Scottish public finance manual.

That is a summary of some of the lessons and changes that have already been learned and made. I am sure that that is not the end of the process, not least because we will reflect on any recommendations that the committee makes in the fullness of time.

Public Audit Committee

Section 23 Report: “New vessels for the Clyde and Hebrides: Arrangements to deliver vessels 801 and 802”

Meeting date: 4 November 2022

Nicola Sturgeon

I preface my answer by stating an obvious point: I am not a shipbuilder, so I am not qualified in any way to talk about the technical requirements of ferries or any other vessels. That is the task of CMAL.

We should remember that these vessels are not the first, or the only, ferries that CMAL has procured. CMAL is a very well-established and experienced organisation when it comes to procuring vessels, and the experience there is exceptional. I certainly do not think that there is any suggestion—obviously, I am talking in general summary terms here—that CMAL did not do the sort of proper technical process for this procurement that it would do for any procurement.

The other point to make concerns Ferguson’s. It was under new ownership; perhaps there is a lesson there in terms of the confidence in the shipyard based on previous contracts—many vessels in the CalMac fleet were constructed at Ferguson’s—versus the experience under new ownership. CMAL went through a process, the contract was a standard industry contract and FMEL signed that contract. The management and ownership of FMEL were experienced businesspeople, and they signed the contract in full knowledge of what they were signing up to. They would have taken their own advice on that.

To go back to your question about whether there are lessons to be learned here, of course there are. In some of what I said in response to previous questions, I captured some of the changes that CMAL has already made: having a ship broker to provide assurances on yards that are bidding; having an independent panel member on vessel procurements; and using naval architects alongside its own in-house team on the technical assessment. Those changes certainly suggest that CMAL is very serious about learning lessons and strengthening the process around technical aspects of bids for the future.

Public Audit Committee

Section 23 Report: “New vessels for the Clyde and Hebrides: Arrangements to deliver vessels 801 and 802”

Meeting date: 4 November 2022

Nicola Sturgeon

I am sorry—what did you say there?