Hansard

I welcome the opportunity to update the Parliament on Ferguson Marine. My statement will build on the Cabinet Secretary for Transport’s statement and set out clearly the Scottish Government’s commitment to doing all that we can to secure the yard’s long-term future.

Ferguson Marine is the last commercial shipyard on the Clyde. It supports skilled employment in Inverclyde, and it plays an important role in Scotland’s wider industrial capability. In 2019, the Government brought the yard into public ownership to safeguard jobs and shipbuilding skills and to complete the Glen Sannox and the Glen Rosa. Our priority now is to secure a sustainable future for the yard, with clear work, improved delivery confidence and a modernised facility.

Progress on current vessels is important context for the decision that I will set out. The MV Glen Sannox has now completed her first year in service, and the MV Glen Rosa continues to make progress, with delivery anticipated to be in the fourth quarter of 2026. I recognise the frustration felt by the Parliament, island communities and the workforce as a result of the delays and cost pressures associated with the Glen Sannox and the Glen Rosa. I also recognise the impact on those affected, particularly the island communities that rely on the ferries for work, family life and essential services. Their frustrations are justified, and I understand the strength of feeling.

Delivery challenges have rightly led to scrutiny of the yard’s performance and of past decisions. That scrutiny is both necessary and appropriate, but it is also a catalyst for change. As the Glen Rosa build enters its latter stages, we also need to address the longer-term future of the shipyard. A new senior leadership team is in place, with stronger commercial disciplines, clearer accountability and improved assurance reporting. Oversight has been strengthened and governance arrangements have been tightened. The annual accounts for 2024-25 and Audit Scotland’s accompanying report were published in December. Taken together, they demonstrate measurable improvement in governance and controls compared with previous years. Those arrangements are designed to support better planning, firmer cost control and more consistent delivery. It is on that strengthened foundation that I am now able to set out the next steps.

Securing the long-term future of the yard requires a clear and credible pipeline of work. In her statement, the Cabinet Secretary for Transport set out that the Scottish Government proposes to directly award the contracts for two ferries under phase 2 of the small vessel replacement programme to Ferguson Marine. In addition, I can also announce that ministers propose to award contracts for a further two vessels to Ferguson Marine—replacements for the marine research vessel Scotia and the marine protection vessel Minna. Together, that represents a programme of four new vessels that it is proposed will be built in the yard. That is a substantial and clear demonstration of our confidence in Ferguson Marine.

Ministers must, of course, ensure that public contracts are awarded in accordance with legal requirements and that they demonstrate value for communities and for the taxpayer. A detailed due diligence process is under way in the Scottish Government to closely assess the viability and implications of the proposals, and engagement with the Competition and Markets Authority is among the steps that are required before any formal contract award decisions can be made.

It is important to be clear about why the vessels in question are a strong fit for the yard and why we have confidence in Ferguson Marine to build them. First, they are of a scale and technical profile that match the yard’s facilities and workforce capability. The proposals are supported by strengthened governance and assurance, so that progress, costs and risks would be properly managed throughout delivery. Secondly, there is continuity of experience. In several cases, the new vessels will replace vessels that were previously built at the yard, building on knowledge of similar vessel types and public service requirements. Thirdly, the proposed programme would support steady delivery, because a pipeline of vessels would allow the workforce to move from project to project and would support investment in training, apprenticeships and productivity.

The proposed programme is intended as a bridge to the future, but it is not the limit of our ambition for Ferguson Marine. A sustainable shipyard must be able to win and deliver work beyond a single customer, so ministers intend to return the business to the private sector when the time is right. The proposed programme would provide a stable baseline that would allow the yard to plan its workforce, strengthen its supply chain and invest in improved ways of working. It would also provide the yard with an opportunity to re-establish itself as a credible and competitive shipbuilder by demonstrating consistent delivery, controlling costs and delivering vessels that perform in service.

The proposed four-vessel programme would form the core of the yard’s workload over the next five years. Alongside that, the yard would continue to have capacity to take on other commercial work, where that can be planned and delivered without compromising the delivery of the public service vessels.

I have previously announced a commitment of up to £14.2 million over two years to support the modernisation of Ferguson Marine, which, again, is subject to due diligence in advance of formal investment decision making. In the current financial year, interim investment has focused on essential repairs, health and safety improvements and targeted equipment upgrades. Those measures were necessary to stabilise operations and support the delivery of the MV Glen Rosa, but they were not transformational. Further modernisation must be aligned with the needs of the proposed vessel delivery programme, so that investment supports efficient production and improved productivity.

Our proposal to progress with four new directly awarded vessels provides the clarity that is needed to plan modernisation properly. We are working with the yard to optimise sequencing and to develop an updated business plan that must undergo legal, commercial and subsidy control assessments before formal decisions on contract awards can be made. By linking workload to modernisation and governance, the yard would upgrade infrastructure, improve productivity and streamline production practices while vessel projects were under way. That approach would provide continuity for the workforce, stability for the supply chain and a stronger foundation for a competitive and sustainable future.

The substantial proposals that we are announcing today would deliver for Ferguson Marine, for island communities and for Inverclyde. We are strengthening ferry resilience and connectivity for communities that rely on dependable services. At the same time, our plans for new vessel awards would support skilled employment and industrial capability in Inverclyde, where Ferguson Marine remains an essential part of the local economy and a shipyard of national industrial importance.

I have spoken about investment in the yard and in new vessels, but I also place on record my sincere thanks to the workforce at Ferguson Marine. Through a prolonged period of challenge, scrutiny and uncertainty, they have continued to demonstrate professionalism, resilience and a deep commitment to their craft. Shipbuilding is highly skilled and demanding work that requires precision, teamwork and pride in delivery. Despite the pressures surrounding recent projects, the workforce has remained focused on completing complex vessels to a high standard and on maintaining the yard’s reputation for engineering expertise.

I also recognise that uncertainty affects not only those who are employed at the yard, but their families as well. Stability and clarity matter deeply to the people whose livelihoods depend on Ferguson Marine, and I acknowledge the constructive role of trade unions in supporting stability, reform and improvement. Their engagement is important in helping to steer the yard through difficult times and towards a more secure future. I spoke to Alex Logan and Kenny Meechan of the GMB again this morning, and they stressed the need to retain the young workforce at Ferguson Marine.

My statement makes clear that the Scottish Government is committed to doing all that we can to secure a competitive, productive and sustainable future for Ferguson Marine. With our proposal to award a four-vessel programme to the yard, we are setting a clear ambition for Ferguson Marine’s future—one that is built on shipbuilding confidence, capability and continuity. We rescued Ferguson Marine for a purpose, and we are determined to see it succeed.