£87,000 bonus for Ferguson bosses branded 'unacceptable'
- Published
The Ferguson shipyard was nationalised in 2019
Scotland's public spending watchdog has raised concerns over £87,000 paid in bonuses to six senior managers at Ferguson shipyard in Inverclyde.
The auditor general said it was "unacceptable" the money had not been cleared by the Scottish government.
The BBC understands the money was paid under former turnaround director Tim Hair, who was brought in in 2019.
Current chief executive David Tydeman said the firm had introduced greater transparency over incentives.
In a report, external to MSPs on Tuesday, Auditor General Stephen Boyle said the bonus payments were approved by the remuneration committee and based on a paper from Mr Hair, who was appointed by the Scottish government after it nationalised the yard.
The report said he was paid £1.8m during his time at the yard between August 2019 and February 2022.
It added: "There was a lack of transparency and good governance around the assessment and approval of these payments.
"FMPG was unable to evidence the evaluation over the discretionary element of this payment."
'There were managers everywhere'
By Calum Watson
Alex Logan and John McMunagle told the BBC how they became disillusioned with the management appointed after nationalisation
The workers at Ferguson Marine have had so many false dawns. When the BBC investigated the ferries scandal last summer, we were keen to get their perspective.
In 2019, as the shipyard faced administration for a second time in five years, they told us they were initially sceptical about nationalisation.
Many of them still bought into owner Jim McColl's dream of a Clyde shipbuilding revival - but they were persuaded it was the best chance of saving their jobs.
The government appointed Tim Hair with the title "turnaround director" on a daily rate of £2,850. Soon the old management team were gone and a new team were in place, promising to get the build back on track.
"Our concerns started growing when there were more, as we call it, management team planners, whatever you call them, grey hats, every week. There was more and more and more people coming on site," said plater Alex Logan.
Welder and GMB steward John McMunagle added: "We brought it up at every board meeting. 'Why is this happening? We just can't believe what's happening here, we've got managers everywhere. We can't get steelworkers'."
Read more - The workers who saw Scotland's ferries saga unfold
Mr Boyle said: "It is unacceptable that performance bonuses were awarded to senior managers at the shipyard, without proper governance for such payments. The Scottish government needs to make sure its rules over pay are followed by this public body."
Mr Boyle also warned about uncertainty over the completion of two lifeline CalMac ferries, Glen Sannox and the unnamed vessel 802.
The ships are five years behind schedule and three times their original budget.
Mr Boyle said there were uncertainties over the final cost of the ferries, when they will be ready and whether the yard has a viable future.
The report said another £9.5m is potentially needed for their completion.
They are due to be finished in May of this year and March 2024.
Glen Sannox and hull 802, pictured, are still being constructed at Ferguson shipyard
Mr Boyle added it was deeply concerning that the cost of the two ferries had continued to escalate while island communities remained "significantly impacted".
Mr Tydeman said the funding gap identified in the report was "largely to cover increased contingency expenditure".
He said: "I would stress that the construction costs to build both vessels are not a major contributing factor to this funding gap.
"FMPG is largely holding to the budget submitted in September 2022 to complete construction."
Mr Tydeman said the firm had taken on board the watchdog's remarks.
He said he believed there was a strong future for the yard.
'Damning report'
The Scottish government said it was a concern that Fergusons did not get approval for bonuses, but the firm's new senior management team was committed to consulting with the government on the issue in future.
It said it expected Fergusons to provide a strategic business plan to ministers "in due course".
A spokesperson added: "Significant progress has been made by the chief executive and chair of the board on the governance structure at the shipyard over the last 12 months.
"We deeply regret that work on the two ferries is taking longer than it should. The Scottish government remains focused on supporting our island communities that rely on this type of vessel."
Scottish Conservative transport spokesperson Graham Simpson said the report was "utterly damning" and called for an independent inquiry into the ferry scandal.
He said: "The SNP-Green government need to urgently spell out what the future holds for the yard and if they are going to remain competitive in any future procurement processes."
Neil Bibby, Scottish Labour's transport spokesperson, added that islanders, taxpayers and yard workers were being "failed at every turn" with no answer on what went wrong.
And Scottish Lib Dem economy spokesperson Willie Rennie called for an urgent statement from ministers to explain the saga.
- Published29 November 2022
- Published23 February 2023
