It is deeply disappointing to learn that CMAL has effectively cut Ferguson Marine out of the tendering process for its next ferry orders. That they have done so with the tacit approval of the Scottish Government is perplexing. Why would you nationalise a shipyard and then place obstacles in the way of its success?

The Scottish Government has apparently done this on the basis that Ferguson Marine cannot be allowed to compete for new work until it has finished the contract for the controversial two ferries currently under construction. They can’t tender for new orders until the yard ‘has got its act together’!

This might sound reasonable but it is actually very punitive and will go a long way towards preventing the yard becoming succesful. Fergusons Marine has gone into liquidation, it’s former owner has gone and the senior management has been replaced by a so called ‘turnaround manager’ earning around £1 million per annum. The Scottish Government needs to show faith in its own shipyard. If the Government doesn’t have faith in the shipyard why should anyone else have faith in it, including the workforce, and the many other businesses that the yard will depend on.

Business operates to a large extent on the basis of faith. It is an act of faith to assume that any business can and will deliver what it promises. It is also an act of faith to assume that a customer can and will pay for what is ordered. If the Scottish Government does not have confidence in its own nationalised shipyard under the management of its very highly paid ‘turnaround director’ then it is a sorry day and it is up to the Government to effect a remedy. Two years after the nationalisation and a year and a half after the ‘turnaround director’ was appointed the yard is apparently still not in a position to tender for new orders ! What on earth is going on?  

The Scottish Government position also lacks understanding of how such businesses operate. Shipbuilders do not finish one job and then sit around twiddling their thumbs and polishing their tools until another order comes in. If that were so they could never compete with shipbuilders who have a pipeline of orders and can therefore offer value for money to each of their customers.

Long before the keel for a new ship is laid the project managers will be hard at work planning the job and liaising with multitudinous subcontractors and suppliers. Long after the fabrication of the hull is complete a multitude of trades will be fitting out the ship. Meanwhile in a well-run yard the shipwrights and the welders and fabricators will be working on a new hull and while all this goes on estimators will be hard at work tendering for new orders.

Those who profess to a knowledge of business continually make the case for competition; the necessity for and the value of competition. Such folk often fail to understand the value of co-operation. It is the unrivaled ability of humanity to co-operate that has led to the success of our species and it is the efficient cooperation of suppliers, subcontractors, employees and a whole host of others that leads to the success of any business.

This truth, known throughout the enlightened business world, is almost entirely lost on the dinosaur directors of CMAL.      

CMAL who it seems has the full backing of the Scottish Government and yet the Scottish Parliament’s Rural Economy and Connectivity Committee, who held an enquiry into what went wrong with the controversial Ferguson Marine contract for ships 801 and 802, concluded that the problem had been a “catastrophic failure of procurement”. CMAL were in charge of the procurement and were calling all the shots and yet no blame has attached to them.

The owner and directors of Fergusons Marine have lost their business and their jobs. That is the moral hazard that pertains in the private sector. In the public sector its seems there is no blame to be laid and no accountability. No heads have rolled, the usual statement ‘that lessons will be learned’ is proffered and on they go as brazenly and as cockily confident as ever. And why shouldn’t they be because they have quite literally run rings around the Scottish Government and continue to do so.

This would be laughable if it wasn’t so important. The importance goes beyond Fergusons yard and beyond even the dire need for reliable ferries for our islands. One of the great and tragic themes that bedevils and ruptures the fabric of our country is the contest between public sector inefficiency and private sector greed.

We on the left wing of political thought generally favour the nationalising of strategic industries and repeatedly make the case for publicly run services, but if public ownership is to remain a possibility and public services are to remain affordable and viable, then we must find a way in which they can be run effectively and efficiently. Our ability to do so rests almost entirely on the concept of accountability.

In viewing the debacle surrounding the sad and sorry tale of the building of ships 801 and 802 it is tempting to follow the wisdom of Solomon and ascribe 50% of the blame to each party. The truth of who is to blame and who is not may never be known but there is no reading of the evidence which ascribes no blame at all to CMAL. It is therefore imperative that they are held accountable and are seen to be held accountable for their reckless part in this debacle. The moral hazard of public sector accountability has to echo across the public sector.

If the Scottish Government has neither the courage, the understanding nor the common sense to see this, then the public will surely hold them accountable at the next opportunity.