Covid shutdowns add £4.3m to over-budget ferry costs
- Published
Shutdowns of the Ferguson shipyard during the Covid pandemic have added an extra £4.3m to the cost of two over-budget and delayed CalMac ferries.
The Port Glasgow shipyard had to suspend working for four months during the first lockdown and was closed for another four weeks earlier this year.
Despite the latest shutdown, the yard still hopes to deliver the first ship Glen Sannox in April to June next year.
The nationalised firm plans to move to seven-day working later this month.
The two ferries, destined for CalMac's Arran and Skye/Outer Hebrides routes, were originally expected to enter service in 2018/19. They have been subject to repeated delays and will cost the public purse more than twice the original £97m fixed price contract.
How the costs have added up
£97m - original fixed price contract for design and construction
£110m-£114m - estimated cost of "remedial work" to finish the ships after the yard was nationalised
£45m - Scottish government loans to Ferguson prior to its collapse, which are now "written down", an assumption they will not be fully repaid
£4.3m - "exceptional costs" as a result of two yard shutdowns during the Covid pandemic
The shipyard went into administration in 2019 with the ferries still far from completion, and the yard was later taken over by the Scottish government.
A programme of remedial work to complete the ships, drawn up by the shipyard's new management, will add an extra £110m-£114m to the overall cost.
Tim Hair, turnaround director appointed by ministers, said the Covid shutdowns were being treated as "exceptional costs" in addition to this figure - but the remedial work itself remained within budget.
He told a committee of MSPs last week that in addition to a four month shutdown last year, the shipyard had to close for four weeks in January to reconfigure amenities under new Covid guidance. The shutdowns cost £3.3m and £1m respectively.
Turnaround director Tim Hair wants to recruit 120 extra workers to allow weekend working
Mr Hair said that 80% of design work was now signed-off by regulators and that the latest delivery schedule of April to June 2022 for Glen Sannox, and December 2022 to February 2023 for the second ship, was still achievable.
Much now depends on the successful recruitment of 120 extra skilled workers to allow the yard to move to seven-day working from 19 March, taking the total workforce to more than 500.
To date, 191 applications have been received, with 40 so far identified as having the relevant skills.
The aim is to recruit UK-based workers, but if that fails, Ferguson Marine will have to consider foreign workers and any delays could affect the delivery schedule.
Mr Hair said "excellent progress" had been made in establishing a design office and recruiting a new head of engineering - and that the yard should be able to take on new work from next spring.
CMAL, which procures ships for CalMac, is about to seek tenders for a new large ferry for the Islay route, and has just announced a 10 year programme to replace seven smaller ferries.