TYCOON Jim McColl has condemned ministers' failure to disclose a "suppressed" ferry fiasco contract which he says shows his now defunct shipyard firm could have been allowed to complete two lifeline vessels at less than half the current cost.
Mr McColl, one of Scotland's wealthiest men, says the failure amounts to a "cover up" as it shows that his Ferguson Marine firm was legally entitled to ask for extra costs to complete the ferries before it went into insolvency and was subsequently nationalised by the Scottish Government.
The contract, he says, crucially states that it was not fixed price as insisted by state-controlled Caledonian Maritime Assets Limited (CMAL) and ministers.
Issues over whether it was a fixed price led to CMAL refuting a claim for £67m over the £97m proposed price to complete the ferries under Mr McColl's Ferguson Marine.
The Scottish Government concluded two months before Ferguson Marine went under that there was no legal basis for CMAL to pay more than what it said was a £97m fixed price.
Mr McColl says if the extra costs claim had not been rejected because of the idea that it was a fixed price, the ferries would have been built for just £200m rather than the near £500m he believes it will end up being.
READ MORE: Anger as SNP blocks ferry fiasco compensation vote
It has emerged that vital pages have been removed from the previously secret contract to build the ferries before they were finally published by the Scottish Government. They included crucial financial details over the contract, guarantees, payment details, permissible delays and cost liabilities.
Out of 59 contract clauses relating to the build for both vessels, just eight are ever disclosed in any capacity, full or not.
In March it was confirmed that due to "persistent design gaps and build errors" the first of the two Ferguson Marine vessels, Glen Sannox is scheduled for autumn 2023 rather than the end of May 2023 with a "contract backstop" of no later than the end of December 2023.
Hull 802 is now not expected to set sail till the autumn of 2024 having already been delayed to the end of March 2024. The contract backstop was stated as being at the end of December 2024.
Official financial budget statements revealed that the cost to the taxpayer of the Scottish Government's intervention in Ferguson Marine before and after its nationalisation has now soared to more than £450m.
Mr McColl who wants the full contract released, says it omits 35 pages of contract terms out of 37 and that a full disclosure would reveal the "lie" that no more money could be paid to Mr McColl's firm for the ferries.
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"They intentionally suppressed the release of crucial pages which reveal that the contract is not a fixed price contract and that there was a prescribed legal way for CMAL to pay more than the original contract price," said Mr McColl who added that it was "scandalous" that there remains a lack of proper scrutiny over the affair.
"It is appalling it has been withheld and is fundamental to what went wrong.
"The Scottish Government wanted to shut down a knowledgeable investigation into what went wrong.
"It was presented as a legal issue but it was a lie to say they can't pay more for the contract. Not releasing the full contract details is suppressing information. The details have been blocked because it would have exposed the full problem."
Richard Leonard, convener of the Scottish Parliament public audit committee, which is investigating the arrangements to deliver the vessels is currently seeking an unedited copy of the contract from the Scottish Government's economy director general Gregor Irwin.
"The committee believes there is clear merit in publishing this contract information in full and asks the Scottish Government to do so in the interests of transparency and to enable scrutiny. Should this not be possible, the committee requests a detailed explanation of the reasons for this approach," says Mr Leonard in a letter to the Mr Irwin.
"It should all be out in the open, "said Mr McColl, who rescued the Ferguson Marine out of administration in the summer of 2014 in a move partly brokered by former First Minister Alex Salmond, who kept the entrepreneur abreast of businesses that needed saving. "It was under this pretence that the Scottish Government took over the yard."
The Scottish Government had stated that sections of published documents relating to Ferguson Marine were redacted "due to commercial or legal confidentiality" but Mr McColl says the 'get-out' clause should not he allowed to stand.
Ferguson Marine's claim for extra costs rose from £17.5m in July, 2017 to £65.8m in December, 2018.
The shipyard firm fell into administration in August, 2019 because the dispute with CMAL over the spiralling costs and delays in the construction of the ferries could not be resolved. By the end of the year, the Scottish Government brought the shipyard into public ownership.
READ MORE: 'Eyewatering' £620,000 taxpayer cost of 'ignored' ferry fiasco study
The taxpayer has ended up paying the price for the ferry fiasco - as ministers constructed a deal to allow Mr McColl's Ferguson Marine to get the contract in the autumn of 2015 which meant it is not being paid for through CMAL's revenues, as it would have if it was still being built by Mr McColl's Ferguson Marine.
Ministers provided a £106m public loan with special provisos to protect to CMAL to protect them to ensure that the ferry contract could go through without the normal safeguards in the wake of the ferry procurer's concerns that it was being put at commercial risk if Ferguson Marine became insolvent or failed to deliver on the ships without the full refund guarantees.
Ministers sanctioned special financial support for CMAL with a crucial pledge that the ferry owners would not have to repay anything until after the vessels had been delivered.
CMAL would normally have been expected to pay off the loan over 25 years using revenue it generates from the fees they get from the lease of vessels like CalMac's ferry fleet and harbour access charges.
It comes amidst a row over ministers blocking the release for audit scrutiny of the reasoning behind going ahead with the completion of Scotland's ferry fiasco vessels despite being considered not value for money.
MSPs have been told that the 'value for money' analysis by consultants Teneo that cost the taxpayer £620,000 will not be disclosed because it is feared it will jeopardise the future of nationalised Ferguson Marine's.
The review said it would be cheaper to scrap Hull 802 and place a new order elsewhere. But the government said continuing the build of Hull 802 was the fastest way of securing a new ship.
They have used the same reasoning in blocking the release of a report commissioned by the Scottish Government from consultancy firm First Marine International (FMI) which is punctuating ministers' decision-making on how it deals with Ferguson Marine.
Scottish Conservative shadow transport minister Graham Simpson MSP said: “There has been a woeful lack of transparency from the very beginning of this sorry saga – and we have the bizarre situation where the SNP-Green government are blocking an audit report into why ministers chose to ignore the verdict that it would be cheaper to scrap hull 802 and start from scratch.
“This murky scandal has cost the Scottish taxpayer hundreds of millions and failed to deliver for islanders. Yet we still don’t know why ministers allowed the removal of mandatory financial safeguards, whether Fergusons received preferential treatment, or the basic terms of the contract.
“Given the scale of this disaster, that is unacceptable. The SNP must come clean and the public must be given all the facts about how this deal went so badly wrong.”
A Scottish Government spokesman said: “We will consider this request from the Public Audit Committee in due course.”
CMAL was contacted by The Herald for comment.
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