Shipyard future remains 'uncertain' as calls grow for review into 'failings'

The future of the shipyard tasked with building the MV Glen Sannox and MV Glen Rosa remains uncertain, auditors have said.

An Audit Scotland report called for an independent review of governance at Ferguson Marine Port Glasgow (FMPG) to address "failings and weaknesses.”

FMPG has no more work secured beyond the completion of MV Glen Rosa, currently due to be delivered in September 2025 with the Glen Sannox already handed over to Calmac.

However, there are multiple risks to the continued costs of completing MV Glen Rosa.

Ongoing investment is needed to make the yard competitive and generate future income, with the only guaranteed income being funding from the Scottish Government up to 2026.

Now, auditors have raised serious concerns over poor governance and decision-making.

Stephen Boyle, auditor general for Scotland said: “We are again highlighting issues of inadequate governance and decision making.

“An independent review of governance arrangements needs to be swiftly actioned to ensure such poor decisions, without the right checks and balances, are not repeated.”

No evidence was provided as to how FMPG decided to award two employee exit packages.

Both were above the £95,000 public sector threshold set out in the Scottish Public Finance Manual, which provides guidance on the proper handling and reporting of public funds. These payments were made without the required Ministerial views.

An internal investigation revealed the yard’s previous chief executive agreed changes to a seconded employee’s contract, without the formal approval of either the board or remuneration committee.

Not only was this a failure to follow the accepted procedure, but it also resulted in FMPG having to back-pay HMRC £48,000 in underpaid income tax.

A spokesperson for the yard said it "remains optimistic" about the bid from the small vessel replacement programme and has undertaken "significant" work on governance.

The spokesperson said: "The contractual changes involving a seconded employee came to light due to proactive action by our chief financial officer and accountable officer, who immediately took the necessary steps to investigate, alert HMRC and ensure all monies due were paid.

"HMRC has since informed Ferguson Marine that no penalties will be imposed, due to the 'behaviour and quality of disclosure' by the chief financial officer.

"The decision not to disclose this agreement - and two other payments to departing employees - to the FMPG board or its remuneration committee is not acceptable practice at Ferguson Marine; the individuals involved are no longer employed by Ferguson Marine.

"We can add further that, since uncovering the governance concerns, a significant amount of work has been undertaken to implement a robust programme of governance inspections and improvements, and we continue to make every effort to ensure that correct protocols are followed.

"With regard to the future of the shipyard, we have a Letter of Comfort from Scottish Government for the majority of 2025, and we remain optimistic that our current bid for the small vessel replacement programme tender and other commercial activities will be successful and provide more certainty for our experienced and skilled workers as we continue to explore other opportunities while progressing Glen Rosa to completion."

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