The discussion about the root cause for the failure of Scotland to deliver two ferries on time has become a tussle between two competing media stories. On the one hand the Scottish Government wants us to believe it is almost wholly due to incompetence on the part of the shipbuilder which left the government with no option but to bail it out before it failed.
On the other hand opposition parties are seeking to turn this into a story of how everything went wrong because of the tendering and procurement processes of the Scottish Government.
However neither of these explanations is really able to explain what has gone wrong, because the primary cause of the failure at the yards is almost certainly the result of something else altogether – the commissioning and specification process. This has been insufficiently examined in part because the responsible body is heavily engaged in the other two narratives.
The body which is primarily responsible for the specification of the boats is CMal. CMal was effectively created to deal with legal implications of the privatisation of Northlink Ferries and is a privatising-friendly private-sector-dominated organisation. It seems that from the beginning CMal was intensely hostile to the Fergusons yard getting the contract.
Indeed it seems to have sprinkled a wide range of letters and statements around the government during the period which had the primary purpose of seeking to dissuade the Scottish Government from considering a Scotland-based bid.
But the goal of the Scottish Government in securing a substantial shipbuilding presence on an island nation is not only legitimate, it is arguably highly sensible. Most of the competing shipyards which would otherwise have gained the work are heavily backed by their own governments to the extent that in many cases the ‘refund guarantee’ they offer (and which has become the focus of much speculation) are actually state guarantees, not private sector ones.
Equally, using public procurement to build up a strategically important industry like building ships on an island nation is an approach almost certainly used by all the competitor yards. It is economically illiterate to believe that this is a distortion of the ‘free market in shipbuilding’.
But the problems do indeed begin with the procurement process, just not for the reason of the guarantee. The problem was that it appears to have been rushed for political reasons and that meant that the contract was signed hastily before the specification for the ships was agreed – and none of the risks involved in that seem to have been considered by the Scottish Government.
The primary cause of the failure at the yards is almost certainly the result of something else altogether – the commissioning and specification process
From there a very large proportion of the blame lies with CMal (which may explain the rate at which documents pointing at the failures of others which derived from CMal keep making their way into the public domain).
To begin with, CMal overruled multiple experts who advised strongly that it should commission an ‘off the shelf’ ferry, one with well-known structure which was easy to build and where there was widespread industry understanding of its construction. This was also advised strongly as producing the most useable outcomes – a catamaran design is both reliably buildable and particularly suited to some of the comparatively shallow harbours it would be serving.
But CMal insisted on commissioning a bespoke (and therefore essentially experimental) ship based on a deep hull structure which then required unnecessary and very substantial redevelopment of some of the ports it would be serving. It was warned against this repeatedly but refused to listen.
From here the problems only got worse – CMal seems to have been altering the specification of the ferries continuously through the build process. In particular it seems to have increased the overall length of the ship after a lot of the cabling had been installed.
There has been much made of the fact that the cabling wasn’t long enough, generally presented to demonstrate the argument that the construction process was flawed or incompetent. But it seems that in fact the cables were the right size for the ship that was commissioned at the time the cables were put in but were insufficient after CMal extended the length of the ship after the cables were already in place.
The only body which seems largely guilt-free in this whole affair is CalMac itself which is suffering from the lack of supply of reliable ferries but was stripped of the capacity to actually secure those ferries in the first place to facilitate the NorthLink privatisation
This is only one example of major problems which resulted from specifications changing after construction had begun and it seems that some of the legacy problems which are still being dealt with make the new deadline promised for this work almost impossible to meet.
None of this is to dismiss questions about performance at the Fergusons yard – in fact, as a new start-up it might have been quite surprising if there weren’t initial hiccups and teething problems. Indeed this is why patient public procurement is often used to help start-ups like this succeed and establish themselves in the first place.
What is definitely the case is that Fergusons had serious, long-term plans for how it was going to develop and expand, plans which now seem to be largely jettisoned by a shipyard which is now inevitably being run as a political project, not a commercial one.
It most certainly does not exonerate the Scottish Government – again, it was the rush job during procurement which at least exacerbated and potentially caused all the later problems. It was shoddy and poorly managed.
In fact the only body which seems largely guilt-free in this whole affair is CalMac itself which is suffering from the lack of supply of reliable ferries but was stripped of the capacity to actually secure those ferries in the first place to facilitate the NorthLink privatisation. That was why CMal was created, to get round EU rules and allow some privatisation to coexist with the existing nationalised system.
Those who have received blame certainly deserve at least some (in the case of Fergusons) or much (in the case of the Scottish Government) of the blame their have received. But CMal has emerged almost as if it is the most honest and reliable player in this affair, and that is a substantial distortion of the reality.
It now seems that the only possible way the Scottish public are going to get a reliable explanation of the multiple failures which have taken place here is via a full public inquiry. CMal may currently be unscathed by the media debate so far; it is very unlikely that impunity would remain intact in the face of a proper investigation.