A PROBE into the construction of two new CalMac ferries has branded the management of the process a “catastrophic failure” in a damning report.

Holyrood’s Rural Economy and Connectivity Committee called for a “root and branch overhaul” of the procurement of new vessels in Scotland in the wake of the fiasco.

It demanded an independent review of the ferry procurement process after concluding that the established procedures are “no longer fit for purpose”.

MSPs launched an inquiry last year into how a disastrous contract to build two ferries at Ferguson shipyard in Port Glasgow went so badly wrong.

Ferguson Marine Engineering Limited (FMEL) won a £97 million contract to build two hybrid ferries for Caledonian Asset Management Limited (CMAL) in 2015.

CMAL is a Scottish Government-owned firm that owns and procures ferries for use by operator CalMac.

But disputes and a breakdown in relations eventually culminated in the shipyard falling into administration, before it was nationalised last year.

The two CalMac ferries at the centre of the row will now be delivered years late at twice the original cost.

In a 129-page report published today, the Holyrood committee said the evidence exposed a “lack of robust due diligence” on the part of CMAL.

It called on Audit Scotland to undertake a separate review of the financial management of the contract by CMAL and the role of Transport Scotland in the process.

It also highlighted concerns about a “complete lack of transparency” surrounding the purpose, agreement and payment of commercial loans totalling £45m to FMEL by the Scottish Government. 

Committee convener Edward Mountain MSP said “all parties involved must share in the responsibility for the catastrophic failure to deliver this contract on time or on budget”. 

He said: “A lack of due diligence, poor project management and a failure by all parties to take the necessary action to resolve problems as they emerged, means that the cost of the contract has increased from £97m to almost £200m while the island communities who are relying on these ferries to be delivered continue to suffer.

“Our report calls on the Scottish Government to commission an independent external review of the processes for public procurement of ferries to ensure appropriate lessons are learned for the future.”

He added: “The Committee acknowledges that existing processes for procuring new ferries to serve the Clyde and Hebrides ferries network have, in the past, resulted in new vessels being delivered on time and on budget. 

“However, based on the evidence it has received, the Committee believes that there has been a catastrophic failure in the management of the procurement of vessels 801 and 802, leading us to conclude that these processes are no longer fit for purpose and that a complete overhaul is needed. 

“That could include merging or even abolishing certain bodies currently involved in decision-making on ferry procurement.”

A CMAL spokeswoman said: “We will examine the content of the report as a matter of priority and give the recommendations our full consideration.  

“Our position has always been that the problems with the dual fuel ferry project were driven by supplier failure and our evidence to the REC Committee was robust in this respect.”

The former management of FMEL pointed to a response they sent to the Holyrood committee last week, raising a “number of matters of concern” in relation to the evidence MSPs had received.

A Scottish Government spokeswoman said it will “consider the report and respond to its recommendations in due course”.

She said it has already committed to commissioning a study of the legal structures and governance arrangements that exist between the “tripartite group” of Transport Scotland, CMAL and CalMac.