Scottish Parliament, 23 March 2022

241 contributions from 54 members. The official report.

Covid-19 Recovery and Parliamentary Business

Annabelle Ewing (Scottish National Party, Cowdenbeath)

Good afternoon. I remind members of the Covid-related measures that are in place. Face coverings should be worn when moving around the chamber and across the Holyrood campus.

The first item of business is portfolio question time, and the first portfolio is Covid-19 recovery and parliamentary business. If a member wishes to ask a supplementary question, they should indicate so by pressing their request-to-speak button or by entering the letter R in the chat function.

Covid-19 (Vaccination Certification)

Alex Cole-Hamilton (Liberal Democrat, Edinburgh Western)

1. To ask the Scottish Government what plans it has for the future of the Covid-19 certification scheme. (S6O-00894)

John Swinney (Scottish National Party, Perthshire North)

We have lifted the legal requirement for venues to operate a Covid certification scheme, but some venues might opt to use certification to make their customers and staff feel safer.

The Covid status app will remain in place for as long as it is needed to facilitate international travel. A domestic certification scheme will remain in our package of protective measures and might be used if it is required in the future to manage Covid outbreaks, although we hope that that will not be necessary.

Alex Cole-Hamilton (Liberal Democrat, Edinburgh Western)

In her Covid statement last month, the First Minister said that the passes would be retained on a voluntary basis for any business that wants to use them, and the Deputy First Minister has said that again. That creates, in effect, an unregulated scheme, with businesses free to refuse custom to anyone on the basis of their not having the right piece of paper or the correct barcode on their phone, and there is no suggestion of when the scheme will end. Does the Deputy First Minister agree that that creates a potentially dangerous loophole in which the liberties and the right of Scots to medical privacy could be undermined indefinitely?

John Swinney (Scottish National Party, Perthshire North)

No, I do not take that view, because the arrangements around the gathering, handling and processing of information relating to the Covid certification app are all carefully regulated and compliant. Any business would have to be mindful of its policies, decisions and legal obligations in administering any scheme. I am satisfied about legal compliance, and the onus is on businesses to ensure that their operations are legally compliant, too.

Stephen Kerr (Conservative, Central Scotland)

Given that this entire debacle has cost the taxpayer £7 million, which went to Danish and American companies to build an app that many Scottish companies, including those in the Forth valley, could have made more cheaply and effectively, what lessons has the Deputy First Minister learned from the experience? What does he plan to do to ensure that such a thing does not happen again?

John Swinney (Scottish National Party, Perthshire North)

I do not recognise Mr Kerr’s characterisation of the situation. There is an open procurement process, and the Government has to ensure that such services are procured properly and are legally compliant. That process was followed in these circumstances.

The scheme was expanded significantly beyond its original purpose, which is why it cost more money. Clearly, if we expand a scheme beyond its original concept, it will cost more money—that is as straightforward as B following A.

The Government subjects all its decisions to careful scrutiny with regard to financial handling, legal compliance and compliance with other regulatory arrangements. The scheme has complied in every aspect.

I stress that the scheme is a valuable tool in ensuring that we can take the necessary steps to suppress circulation of the virus. It also allows individuals to provide a crucial piece of evidence to enable them to undertake international travel. If Mr Kerr wants to support our airports in attracting more custom, he should note that they require their customers to be able to comply with the requirements of the Covid status app.

The Deputy Presiding Officer

I call Sharon Dowey.

Sharon Dowey (Conservative, South Scotland)

Sorry—I wanted to come in on question 5.

The Deputy Presiding Officer

Okay. You had pressed your button. That is why I called you.

Covid-19 Recovery (Support)

Rona Mackay (Scottish National Party, Strathkelvin and Bearsden)

2. To ask the Scottish Government what work and action across Government it is undertaking to support local authorities and local communities in their recovery from the Covid-19 pandemic. (S6O-00895)

John Swinney (Scottish National Party, Perthshire North)

Across Government, we are working closely with our partners in local government and the third sector to deliver outcomes that will bring about a fairer future, particularly for those who have been most affected during the pandemic. By working together, we will align services around the individuals and families who need them.

The “Covid Recovery Strategy” sets out clearly the outcomes that we will improve for communities. We will increase financial security for low-income households, enhance the wellbeing of children and young people and create good green jobs and fair work through a package of targeted actions. Alongside the president of the Convention of Scottish Local Authorities, I chair the Covid recovery strategy programme board, and we met last week to progress further that ambitious transformation of public services.

Rona Mackay (Scottish National Party, Strathkelvin and Bearsden)

Businesses will play a crucial role in the recovery of local communities up and down the country. However, large rises in energy bills, increased costs for everyday essentials and rising interest rates will mean that businesses will see their margins squeezed.

Does the Deputy First Minister consider that the measures that the Chancellor of the Exchequer set out in his statement just hours ago will have any substantive effect on businesses that already struggle with Brexit-related import costs and supply chain problems, as the high streets that serve our communities try to recover from the impacts of the pandemic?

John Swinney (Scottish National Party, Perthshire North)

I have not had a lengthy opportunity—because of other business—to take in all the details of the spring statement. I have not heard enough in that statement to be confident that businesses have been protected from the challenges that they face. Some measures, such as the reduction in fuel duty, will have an effect, but the implications of Brexit, particularly on the availability of labour, are colossal challenges for the business sector. I hear about that issue every week in my constituency from organisations that cannot recruit enough staff because of the removal of free movement of European Union citizens. What I have heard so far today does not give me confidence that the business community has been given the support that it requires to address the challenges that businesses currently face.

Mercedes Villalba (Labour, North East Scotland)

Universities are a vital part of many local communities, and we must ensure that they recover from the pandemic in a way that protects the health of students and staff. However, in light of rising Covid cases nationally, we continue to see outbreaks in universities such as the University of St Andrews, where more than 450 students tested positive in a single week.

Does the Scottish Government agree that we should consider continuing to mandate protections such as face coverings, testing on campuses, social distancing and ventilation in our universities?

John Swinney (Scottish National Party, Perthshire North)

I acknowledge the significance of the points that Ms Villalba puts to me. We are now going through very significant levels of community transmission, which is presenting itself in a number of ways in university and college campuses around the country, where it is important that we are taking every measure to sustain the education of young people and to protect their safety into the bargain.

In the strategic framework that the Government has published, there is a range of baseline measures that we expect institutions to take forward, and some of those will be around ventilation. We have a mandatory position on face coverings, but Ms Villalba will realise that that position is not universally welcomed in Parliament—the Conservative Party vigorously opposed our extension of the face coverings measures. However, I think that those measures are appropriate for the moment, given the significance of the challenges that we face. Of course, the Cabinet will consider those measures for review at its meeting on Tuesday, and there will be a statement to Parliament next week about those issues.

Pam Duncan-Glancy (Labour, Glasgow)

The additional funding that was given to third sector organisations during the pandemic was much needed, and essential to allow them to offer their crucial support to families. However, this year’s budget hands a cut of around £1 million to third sector organisations. The need for their advice and services has never been greater, particularly as we recover from the pandemic but also in the cost of living crisis and as a result of people taking refuge here because of the war in Ukraine.

What engagement is the Scottish Government having with the third sector to ensure that adequate funding arrangements are in place? Can the Deputy First Minister provide an update on any further considerations that the Scottish Government has given to the development of multiyear funding models?

John Swinney (Scottish National Party, Perthshire North)

The question of multiyear funding models is an issue that arises from the degree of prospective information that we have on the financial arrangements from the United Kingdom Government. We are in a different situation at this moment, because we now have a longer line of sight than we have had for a number of years. The Cabinet Secretary for Finance and the Economy will reflect on those points, because it is desirable for us to give multiyear settlements, and I know that the finance secretary has shared that position with the third sector.

I encourage Pam Duncan-Glancy to look at all budget lines, not just individual budget lines where there might be changes that members would like to see reversed. The Government is making a range of funding streams available to third sector organisations. Within the “Covid Recovery Strategy”, there is a heavy emphasis on the role of the third sector in supporting the work on Covid recovery.

More will be said tomorrow when the social justice secretary shares with the Parliament the approach to the child poverty implementation plan. Obviously, the third sector is critical in supporting our work to eliminate child poverty in our country.

The Deputy Presiding Officer

Question 3 was not lodged.

Freedom of Information Requests

Edward Mountain (Conservative, Highlands and Islands)

4. To ask the Scottish Government what percentage of FOI requests made to it were answered in full within 20 working days, within the last 12 months. (S6O-00897)

George Adam (Scottish National Party, Paisley)

During calendar year 2020-21, we responded to more than 4,000 freedom of information requests, 86 per cent of which were answered within the statutory deadline. That is broadly in line with the average of other Scottish public authorities, and represents the continued recovery of our performance since the start of the pandemic.

Edward Mountain (Conservative, Highlands and Islands)

That is interesting. Perhaps it is just me, but I have numerous examples of FOI requests not being responded to within the time limit, even those that I have had to appeal. Even a simple question such as, “When will vessels 801 and 802 be delivered?” has been left unanswered for more than four weeks. Surely a Government minister with their finger on the pulse should know the answer to that. Will the minister undertake to look at the 14 per cent of FOI requests that did not make the cut and find out why they did not?

George Adam (Scottish National Party, Paisley)

The simple answer to Mr Mountain’s question is that there are other methods of parliamentary scrutiny. He could ask parliamentary questions, should he wish. [Interruption.]

The Deputy Presiding Officer

Minister, could you resume your seat? Could we please have less sedentary comment. A question has been asked, so please let the minister answer. That is the courteous way to proceed. Minister, please resume.

George Adam (Scottish National Party, Paisley)

In summary, Presiding Officer, there are more than adequate measures for members to ask questions about anything they wish to in the chamber.

Covid-19 Recovery (South Ayrshire)

Sharon Dowey (Conservative, South Scotland)

5. To ask the Scottish Government how its policies and actions across Government will support South Ayrshire to recover from the Covid-19 pandemic. (S6O-00898)

John Swinney (Scottish National Party, Perthshire North)

Priorities for recovery will vary by location. Across Government, we are committed to working with communities to understand local needs and tailor support services to support them. We announced an £80 million Covid economic recovery fund for local authorities to target support for businesses and communities. South Ayrshire Council will receive more than £1.68 million and will have full discretion over how to target that support to maximise economic recovery.

Further to that, the Scottish Government is investing £103 million in the Ayrshire growth deal, which will see transformational investment in projects across Ayrshire to support long-term inclusive growth. Regional partners estimate that the deal will create 7,000 new jobs and unlock an additional £300 million from the private sector.

Sharon Dowey (Conservative, South Scotland)

In my constituency, I was proud to see communities and the third sector organisations coming together to support South Ayrshire Lifeline when the pandemic began. That allowed the organisation to expand services such as its helpline and its prescription collection and distribution network, but that would not have been possible without people going above and beyond for their communities. Will the Deputy First Minister outline how the Scottish Government will continue to fund the third sector and retain people in local organisations?

John Swinney (Scottish National Party, Perthshire North)

This is a very important issue. The type of service that Sharon Dowey talks about is increasingly evident within our communities, and is also increasingly developing, because communities are building their capacity to make services and support available on an on-going basis. Just last week, I had a helpful conversation with a number of community development organisations to establish how the good example that Sharon Dowey has put to me can be replicated in other parts of the country. There are many other comparable examples that are already working well.

I am keen to explore how we can ensure that that capacity exists, not just to deal with a situation such as Covid, but to deal with other situations such as winter weather or flooding or other examples where we can use community capacity to assist the public services in addressing need within communities.

I welcome the information about the example that Sharon Dowey has put to me, and I assure her that the Government is keen to build up community capacity.

The Deputy Presiding Officer

Siobhian Brown has a supplementary question.

Siobhian Brown (Scottish National Party, Ayr)

How much money has the Scottish Government spent in South Ayrshire to mitigate the United Kingdom Government policies that are hitting families in my constituency hard as we recover from the pandemic?

John Swinney (Scottish National Party, Perthshire North)

The Scottish Government has made available a number of funding streams in the South Ayrshire area. As part of the local government finance settlement, South Ayrshire Council is receiving funding of £247.6 million, which represents a real-terms increase of 8.2 per cent, and cost of living support of nearly £5 million will be made available to South Ayrshire.

In addition, South Ayrshire Council was allocated £533,000 from the flexible element of the winter support fund. We also allocated more than £1.7 million in discretionary housing payment to the council to fully mitigate the damaging effects of the UK Government’s bedroom tax.

Covid-19 Recovery (Low-income Households)

Emma Roddick (Scottish National Party, Highlands and Islands)

6. To ask the Scottish Government what steps are being taken with ministerial colleagues across Government to ensure that Scotland’s recovery from the Covid-19 pandemic addresses the reported disproportionate impact of the pandemic on low-income households. (S6O-00899)

John Swinney (Scottish National Party, Perthshire North)

Our strategy is focused on those who have been most affected during the pandemic and on creating a fairer future for everyone who has been affected. We will do that by transforming public services to ensure that they are person centred in design and delivery, and by working closely with our partners, including the Convention of Scottish Local Authorities, local government and the third and private sectors. That will multiply the impact of our actions and support communities and the most vulnerable to thrive.

The Government has declared tackling child poverty to be a national mission and is working to mobilise all of Scotland to help us to achieve that goal. We will publish the second tackling child poverty delivery plan tomorrow, which will outline the transformational action that we will take, alongside our delivery partners, to tackle child poverty, which lies at the very heart of the Covid recovery strategy.

Emma Roddick (Scottish National Party, Highlands and Islands)

Recent polling suggests that more than 80 per cent of people in Scotland are worried about the Tory cost of living crisis, with food, fuel and household bills skyrocketing. As inflation soars to a 30-year high, does the Deputy First Minister consider that the United Kingdom Government’s spring budget goes anywhere near far enough to reverse the damage that has been caused by a decade of Tory cuts? Without drastic action, those low-income households will not be a part of Scotland’s recovery.

John Swinney (Scottish National Party, Perthshire North)

Emma Roddick makes a very fair point. I highlighted the fact that the drive to tackle and eliminate child poverty lies at the heart of our Covid recovery strategy. Although, as the Scottish Government announced in December’s budget, the Scottish child payment will be increased in the next financial year, at the same time, the UK Government has removed important increases that were put in place on universal credit. That is a glaring example of how the efforts of the Scottish Government to tackle child poverty are undermined by the actions of the UK Government.

As I said in my answer to Rona Mackay, I have not had a large amount of time to take in all the details of the spring budget statement, but I heard the strong contribution of my parliamentary colleague Alison Thewliss, in which she made the point that not nearly enough action had been taken to tackle the effects of poverty on low-income households. Such action is at the heart of the Scottish Government’s strategy. We would like to have our actions reinforced, not undermined, by the UK Government.

Coronavirus (Recovery and Reform) (Scotland) Bill (Emergency Powers)

Jackie Baillie (Labour, Dumbarton)

7. To ask the Scottish Government whether it will remove the provisions on the extension of emergency powers from the Coronavirus (Recovery and Reform) (Scotland) Bill. (S6O-00900)

John Swinney (Scottish National Party, Perthshire North)

The Government will, of course, consider carefully the views of Parliament as it completes its stage 1 scrutiny of the bill, but I must stress that removing key provisions from the bill in the way that Ms Baillie suggests would mean that Scotland would not have the public health protection measures in place that are needed to counter future public health threats, and I do not believe that that is in the public interest.

Jackie Baillie (Labour, Dumbarton)

The Deputy First Minister has chosen to use the made affirmative procedure, which means that measures can be routinely introduced without parliamentary scrutiny or approval in advance. That does not allow for consultation or for the voice of our constituents to be heard in the chamber.

The Parliament has demonstrated that it can operate quickly. I remind Mr Swinney that we have passed primary legislation in a week—indeed, that was the case with the very first bill that the Parliament considered—and Covid bills have subsequently been passed in a matter of days.

Rather than risk the other positive measures in the bill, will John Swinney change the provisions on the extension of emergency powers so that they are at least subject to scrutiny in advance?

John Swinney (Scottish National Party, Perthshire North)

I do not think that, in these circumstances, Jackie Baillie’s characterisation of the issue is appropriate. The made affirmative procedure is only ever used where time circumstances do not allow us to undertake the normal consultation and dialogue around the affirmative procedure.

I have gone on the record before the Delegated Powers and Law Reform Committee to make it clear that the Government does not routinely intend to use the made affirmative procedure. We would prefer to use the affirmative process, to enable the type of dialogue that Jackie Baillie talks about.

What the Government is trying to do—I am very keen to engage with Parliament on this question—is ensure that we have a statute book that enables us, having learned the lessons of Covid, to respond swiftly and promptly to challenges that may come towards us. Jackie Baillie knows the issues of Covid well; she knows how quickly events have changed in front of us. The legislative framework that we are putting in place is designed to create the capacity for us to act swiftly.

I am keen to ensure that I work with parliamentary colleagues to try to address the legitimate concerns on this question, but, fundamentally, we must have a statute book that is fit to deal with the challenges of the pandemic, and that is my objective in this legislation.

The Deputy Presiding Officer

I have received a number of requests for supplementaries, and I intend to take all of them. The first is from Sandesh Gulhane.

Sandesh Gulhane (Conservative, Glasgow)

In order to ensure that Parliament is able to scrutinise emergency powers in advance of their being enacted, could we agree a raft of emergency powers and leave them dormant? If the need arises, we could get a statement—either virtual or in person—and we would, in the time that it would take to play a football match, be able to grant the Government those powers.

John Swinney (Scottish National Party, Perthshire North)

Well, that is a rather interesting development of the Conservative position, which I am very happy to explore with the Conservatives, since we are now talking turkey on the issue. That is very welcome. Maybe Jackie Baillie will catch up with the new reformist thinking of the Conservatives, who have once again moved ahead and dumped her from the better together alliance.

I welcome Dr Gulhane’s suggestion. What we are trying to do—I go back to my answer to Jackie Baillie—is ensure that there is a framework of legislation in place that enables Parliament to act quickly, where we require to do so. Dr Gulhane has offered an interesting perspective on that, and it is obviously something that can be advanced in the legislative process. If he would care to write to me, I would be happy to meet him and his colleagues to explore what might be involved in that, because—as always—I am keen to build consensus in the chamber.

Willie Rennie (Liberal Democrat, North East Fife)

Well, that is a very interesting development of the Government’s position, because when I asked the very same question of the Cabinet Secretary for Education and Skills, at the Education, Children and Young People Committee, she rejected the suggestion out of hand. I suggest a bit of co-ordination on the Government side.

The Children and Young People’s Commissioner Scotland gave some important evidence on the bill to the committee. He said that he had

“considerable concerns”

that

“Permanent powers ... may ... not be lawful under ... Article 15 of the ECHR.”

Why is the Deputy First Minister ignoring the concerns of the children’s commissioner?

John Swinney (Scottish National Party, Perthshire North)

I am not ignoring them—I am addressing them. I understand the perspective of commentators and commissioners, but ministers have duties to protect public health. Members such as Mr Rennie come to the chamber and complain, if ministers do not act quickly enough to protect public health. I see that Mr Rennie is shaking his head, but I have sat here and listened to him complaining about ministers not acting quickly enough to do certain things.

I am happy to engage in discussion and dialogue on the provisions of the bill, but there is one fundamental point: we must have in place a legislative framework that will allow us to act quickly, should appropriate circumstances arise. That is the purpose of the legislation, and the Government will engage constructively with Parliament to try to achieve it.

John Mason (Scottish National Party, Glasgow Shettleston)

Opposition members often whine when Scotland is a little bit different from England. Will the Deputy First Minister clarify whether the provisions will move us closer to the position in England, or further away from it?

John Swinney (Scottish National Party, Perthshire North)

The statute book in England and Wales contains many such provisions, and they have enabled the UK Government and the Welsh Assembly to act, within their legal framework, swiftly and immediately.

Mr Mason has characterised how the Opposition parties sometimes contribute to the debate. I will not comment on his assessment, but I will say that Opposition parties often come here and ask us to learn lessons. We have learned a lesson from the pandemic, which is that our statutory framework was not adequate to deal with the issues, which is what I am trying to address in the legislation that is before Parliament.

Covid-19 Recovery (Glasgow)

Pauline McNeill (Labour, Glasgow)

8. To ask the Scottish Government how its policies across government will support people living in Glasgow to recover from the Covid-19 pandemic. (S6O-00901)

John Swinney (Scottish National Party, Perthshire North)

By working collaboratively with our partners in local government, business and the third sector, we will deliver a strong recovery that meets needs specific to each area. For example, the Glasgow city region deal empowers Glasgow and its city region partners to identify, manage and deliver a programme of investment to stimulate economic growth and create jobs in the area, thereby supporting the region to achieve its shared long-term vision for the local economy.

The Government is actively involved in dialogue on the city region deal, and we will continue that dialogue, with our focus being on recovery from the Covid-19 pandemic.

Pauline McNeill (Labour, Glasgow)

A report that was published last week by PWC said that Glasgow had slower growth than Aberdeen and Edinburgh in 2021, and that that would continue this year. The United Kingdom average growth across 50 cities that were measured in the report was 7.4 per cent, but, worryingly, Glasgow is at only 4.4. per cent.

Yesterday, the House of Commons Scottish Affairs Committee published an excellent report. It highlighted that the bosses of AGS Airports, which own Glasgow and Aberdeen airports, have said that the pandemic

“has ... set us back decades”,

not just because of

“loss of passengers”,

but because of

“loss of connectivity”

to the whole of Glasgow and its city region.

What more evidence does the Government need that Glasgow is in trouble and needs more assistance and special attention? Will the Government elaborate on what intervention it would make to help the Glasgow city region?

John Swinney (Scottish National Party, Perthshire North)

I acknowledge the importance of ensuring that every part of the country is supported to recover, and it is vital that that is the case in Glasgow and the city region. The Government is engaged with the city region partnership. We use a range of interventions and measures to enhance transport infrastructure and ensure that there is adequate connectivity. Ministerial colleagues are actively involved in discussions on these matters with the relevant organisations.

We have made significant skills investment in the college and university sector in Glasgow and the west of Scotland, to make sure that the skills that are required for the future are adequately delivered and to support the recovery of key sectors that have been affected by the pandemic.

If we look at the overall position on economic recovery, we see that the economy is broadly back to where it was before the pandemic. The key challenge is to make sure that the many strengths of the city of Glasgow and its surrounding areas are built on, to ensure that all citizens can appreciate and enjoy the opportunities of economic growth. That is at the heart of the dialogue between the Government and local authorities.

Bill Kidd (Scottish National Party, Glasgow Anniesland)

How much will Glasgow stand to benefit from the regional economic partnership fund? How does the Scottish Government envision that funding supporting Glasgow’s economic recovery?

John Swinney (Scottish National Party, Perthshire North)

The funding to which Mr Kidd refers is important, and we have to consider the ways in which it can have an effect on economic opportunities in the city of Glasgow. Applications are being assessed by officials, and I can confirm that Glasgow has submitted an application. Decisions will be made in due course and applicants will be notified.

The objective of the partnership is to support internationalisation of the regional economy and ensure that the foundations of the city and regional economy are secure for the long term. That will lie at the heart of decision making about the fund.

The Deputy Presiding Officer

That concludes portfolio questions on Covid-19 recovery and parliamentary business.

Net Zero, Energy and Transport

The Deputy Presiding Officer

We move on to questions on the net zero, energy and transport portfolio. If a member wishes to ask a supplementary question, they should press their request-to-speak button or enter R in the chat function during the relevant question.

Annie Wells joins us remotely for question 1.

Energy Company Obligation 4

Annie Wells (Conservative, Glasgow)

1. To ask the Scottish Government whether it will provide an update on when it is scheduled to meet with United Kingdom Government ministers to discuss the implementation of the energy company obligation 4 scheme in Scotland. (S6O-00902)

Patrick Harvie (Green, Glasgow)

The energy company obligation is a UK Government scheme. Although the ECO4 scheme is scheduled to begin in April 2022, the design of the scheme has not been confirmed by the UK Government.

Since June last year, we have repeatedly attempted to engage with UK ministers on the future of the warm home discount scheme and ECO, but our approaches have not been answered. I would welcome a meeting with UK Government ministers to discuss how ECO can better tackle fuel poverty and deliver a just transition in Scotland.

Annie Wells (Conservative, Glasgow)

I have been in touch with energy businesses in Glasgow, which are extremely concerned about the lack of communication from the Scottish National Party-Green Government about the transition period between the ECO3 and ECO4 schemes. They have revealed to me that if there is no confirmation of a transition period, they fear that, when ECO3 expires in just eight days’ time, many jobs in Glasgow could be relocated to England and Wales.

Will the minister urgently clarify that an ECO3 interim period will apply in Scotland, to help to save those jobs?

Patrick Harvie (Green, Glasgow)

I very much appreciate the frustration that many people have with the lack of clarity. Clarity is needed. However, it is the UK Government that has refused to confirm the design of the ECO4 scheme. Even though that scheme is due to come into force in April, we do not anticipate seeing the regulations that will be laid to define it until April.

Some of the changes that were signalled in the UK Government’s response to the public consultation appear to be based on the English definition of fuel poverty. That might limit the number of eligible Scottish properties.

For clarity, let me say that we have known for a long time that this change was coming. In February 2021, the Scottish Government proposed combining the warm home discount and ECO schemes into a single more flexible fuel poverty scheme in Scotland. Scottish ministers wrote to their UK counterparts in June, in October and in December to ask whether that approach would be acceptable to the UK Government, and we have still not had an answer from it one way or the other.

Offshore Energy Sector (Skills Transition)

Mercedes Villalba (Labour, North East Scotland)

2. To ask the Scottish Government what steps it is taking, in relation to green skills, to remove barriers facing offshore oil and gas workers in transitioning to green jobs in the offshore energy sector. (S6O-00903)

Lorna Slater (Green, Lothian)

I am pleased that OPITO, with Scottish Government support through the energy skills alliance, is making excellent progress towards the enabling of a skills passport.

In the coming months, the ESA will publish its skills transition plan, which will set out work to date and next steps. There has been great progress in what is a complicated and important piece of work, which will support the offshore workforce in its transition journey.

Mercedes Villalba (Labour, North East Scotland)

I look forward to meeting the minister tomorrow, alongside trade unions and climate campaigners, to discuss the need for an offshore training passport.

Another barrier that faces offshore oil and gas workers in transitioning to green jobs is the poor employment practices in the offshore wind supply chain. The Scottish Government often talks about its commitment to fair work, so will it support sectoral collective bargaining in the offshore wind industry?

Lorna Slater (Green, Lothian)

I look forward to meeting the member tomorrow to discuss progress on the offshore skills passport.

The Scottish Government absolutely supports workers. In “Scotland’s National Strategy for Economic Transformation”, the member will see that we support collective bargaining and workers having more of a say in how their jobs are executed.

Liam Kerr (Conservative, North East Scotland)

In a written answer to me, the Minister for Just Transition, Employment and Fair Work, Richard Lochhead, admitted that, having delivered only approximately one in 20 of the offshore wind jobs that it forecast, the Government proposes to widen the definition of a green job. He proposes to use a different definition from the one that the Office for National Statistics—and therefore the rest of the United Kingdom—is using. Does the minister accept that widening the definition would give a distorted picture of how the Government is really performing on the creation of green jobs and that it will make it impossible meaningfully to compare that with performance in the rest of the UK?

Lorna Slater (Green, Lothian)

The discussion of what a green job is is absolutely a live one. It is fair to say that, in the future, all jobs will be green jobs. Tackling the climate crisis is not something that we can put in a box.

Jamie Greene (Conservative, West Scotland)

How can it be green if you do not have one?

Lorna Slater (Green, Lothian)

Everybody needs to play their part; all sectors need to play their part. Of course, it is useful to have a definition when we are planning training and investment, but it is correct that the Scottish Government—[Interruption.]

The Deputy Presiding Officer

Minister, please resume your seat for a second. I call for some courtesy from Conservative members, please.

Please resume, minister.

Lorna Slater (Green, Lothian)

It is absolutely right that Scotland develops a definition of green jobs that is appropriate for our workforce and our industry here.

The Deputy Presiding Officer

Question 3 was not lodged, and question 4 was withdrawn.

Net Zero (Fiscal Measures)

Michelle Thomson (Scottish National Party, Falkirk East)

5. To ask the Scottish Government what ministerial discussions have taken place regarding whether its net zero ambitions could be supported through the introduction of new fiscal measures. (S6O-00906)

Michael Matheson (Scottish National Party, Falkirk West)

Ministers regularly consider new policies, proposals and fiscal regulatory measures to accelerate our transition to net zero. While Scottish ministers endeavour to take all action required to reach net zero, many levers sit within reserved competence. For example, transmission charging sits with the UK Government, and that acts as a disincentive to renewable energy investment in Scotland. It is therefore essential that the UK Government works with the Scottish Government to ensure that fiscal measures support our net zero ambitions.

Michelle Thomson (Scottish National Party, Falkirk East)

Not only will the ambitious net zero targets set by the Scottish Government require to be funded; the frameworks need to be developed, too. That cannot be done in isolation without consideration, by those with the full fiscal levers, of what measures could be utilised. Given the scale of the challenge and the fact that the majority of green tax powers are reserved to the UK Government, does the cabinet secretary share my concern at the recent Westminster Public Accounts Committee report, which noted that the UK

“Government has no clear plan for how the transition to net Zero will be funded”?

Michael Matheson (Scottish National Party, Falkirk West)

Given that a number of the crucial levers, including but not limited to green tax powers, are reserved to the UK Government, I share the member’s concern, referring in particular to the issues that have been highlighted by the Public Accounts Committee about the UK Government’s lack of any

“clear plan for how the transition to net Zero will be funded.”

Prior to publication of the UK Government’s net zero strategy, we made consistent calls for action to be taken in a number of crucial areas that are within reserved competence. Although the strategy contained a number of positive steps to be taken to support achievement of net zero, it was a concern that there was no clear indication as to how those actions would be pursued at fiscal level. That is why it is absolutely essential that the UK Government works with the Scottish Government in ensuring that the fiscal measures that are within the hold of the UK Government also meet Scotland’s ambitious climate change targets.

As I have highlighted, transmission charging, for example, acts as a disincentive. It is therefore essential that the fiscal measures are consistent with achieving net zero by 2045.

Office of Gas and Electricity Markets (Meetings)

Collette Stevenson (Scottish National Party, East Kilbride)

6. To ask the Scottish Government when it last met representatives from the energy regulator, Ofgem, and what was discussed. (S6O-00907)

Michael Matheson (Scottish National Party, Falkirk West)

I last met Ofgem’s board, the gas and electricity markets authority, on 9 February 2022. That was a general catch-up with the board, but the main topics discussed included the price cap announcement, the outcome of Crown Estate Scotland’s ScotWind leasing round and transmission charges. Scottish Government officials continue to meet and engage with Ofgem on a regular basis.

Collette Stevenson (Scottish National Party, East Kilbride)

With rising energy costs and the increase to the price cap, the Tory cost of living crisis is about to escalate. Can the cabinet secretary set out the average cost per household of United Kingdom Government-imposed VAT and energy policy costs, and does he agree that the Tories must cut VAT from household energy bills and immediately implement a fairer warm home discount scheme to support people?

Michael Matheson (Scottish National Party, Falkirk West)

Ofgem has estimated that the VAT component of the average household’s dual fuel energy bill will be around £60 per year and policy costs added are over £150 more. I have taken the issue up with the UK Government on a number of occasions and have asked it to consider a temporary cut to VAT.

Alongside that, we have asked it to take action on the warm home discount scheme and to review the socioenvironmental costs that are included in energy bills. We believe that those actions could collectively help to support families who are facing spiralling energy costs, which are adding to the wider cost of living crisis that the Conservative Government is responsible for. That is why it is essential that the UK Government takes proper concerted action to address the crisis.

Sadly, that was lacking in the spring statement, and the reality is that households will still face very considerable energy costs alongside other rising costs of living, which the UK Government is responsible for taking action on.

The Deputy Presiding Officer

I have a number of supplementary questions, and I intend to take all of them. The first is from Elena Whitham, who joins us remotely.

Elena Whitham (Scottish National Party, Carrick, Cumnock and Doon Valley)

For many rural households in my constituency who are off grid and use oil as their primary source of heating, there are no price-cap protections. Many people are seeing price increases from around 50p to £1.40 per litre, with minimum delivery quotas and payment required on delivery. Does the cabinet secretary agree that the UK Government must intervene to tackle the unregulated heating-oil industry and prevent uncertainty and extreme fuel poverty for rural households?

Michael Matheson (Scottish National Party, Falkirk West)

That area of the energy market is unregulated, and we have raised the issue consistently with the UK Government. It impacts particularly on people who live in rural areas of Scotland, and I recognise the points that the member makes on behalf of her constituents who have had significant increases in the cost of oil for heating systems. That is why we believe that there is a need for proper regulation in the sector to protect households and address the ever-increasing costs that those who rely on oil heating face. It is a policy area that we want the UK Government to take action on urgently.

Foysol Choudhury (Labour, Lothian)

A constituent has recently argued that they believe that the estimated energy bill that they were given during the latest wave of the pandemic was excessive. Has the Scottish Government had any discussion with Ofgem on the use of estimated bills when meter readings cannot be taken?

Michael Matheson (Scottish National Party, Falkirk West)

That area is regulated by Ofgem. If the member has a particular concern about a constituent’s circumstances, he can pursue that directly with Ofgem and ask it to consider the complaint. Estimated bills have a role to play for some households, but there is a process that can be used for individuals to ask for that to be revised on the basis of their submitting a reading.

If the member’s constituent continues to experience problems, advice can be provided on pursuing those issues with their energy supplier to ensure that their energy bill reflects their use of energy, given that their previous bills have been based on estimates.

Maurice Golden (Conservative, North East Scotland)

My question relates to the targeted charging review of transmission demand residual. Ofgem analysis of domestic consumers highlights that the no-floor approach could result in consumers in north Scotland receiving credits that are driven by consumption during the evening peak. A floor approach shows that that would result in an overall decrease in transmission network use of system—TNUOS—charges for typical domestic consumers, apart from those in Scotland. For north Scotland in particular, Ofgem notes that charges will increase compared with current charges, given the assistance for areas with high electricity distribution costs—AAHEDC—policy. The north-east pays more again. Does the cabinet secretary agree with flooring the forward-looking charge at zero?

Michael Matheson (Scottish National Party, Falkirk West)

What I agree with is that the existing system is not fit for purpose, which is why the whole system needs to be changed.

We have a system now in which the predominant TNUOS charging regime is based on providing energy as close to the consumer as possible. However, the reality is that, as we move to a net zero age, the vast majority of energy will be much more distant from centres of population. That is why it is important that any regime that we have in place is one that is reflective of the need to move to net zero.

In addition, any price cap mechanisms that are introduced on the back of that and alongside those measures need to be reflective of the situations of households, including households in our rural areas. As yet, Ofgem has failed to take forward an approach that is reflective of the needs in Scotland.

The Deputy Presiding Officer

Question 7 has been withdrawn.

“Is Scotland Climate Ready?” (Response)

Brian Whittle (Conservative, South Scotland)

8. To ask the Scottish Government what its response is to the Climate Change Committee’s latest report “Is Scotland Climate Ready?”, which states that progress in delivering climate change adaptation measures in Scotland has stalled. (S6O-00909)

Michael Matheson (Scottish National Party, Falkirk West)

Preparing for the locked-in impacts of climate change forms a key part of a just transition, and we are making real progress on that. That progress includes an extra £150 million for flood risk management and £12 million for coastal change adaptation over this parliamentary session.

We are pleased that the Climate Change Committee supports our vision for a climate-resilient Scotland. However, we accept that more needs to be done. This is a global challenge, and we are not alone in needing to accelerate progress. We are now considering the committee’s recommendations, and we will respond to them in due course.

Brian Whittle (Conservative, South Scotland)

I thank the cabinet secretary for that answer, but perhaps I can help him give the real answer to Michelle Thomson’s questions about the concerns around reaching Scotland’s net zero targets. The Climate Change Committee’s report is scathing in its criticism of the Scottish Government. It says that

“action is not being implemented with sufficient scale and urgency”,

that there is no

“credible planning to adapt farmland habitats and species”,

and that there is a

“gap in planning for maintaining a weather-resilient energy system”

and

“insufficient inclusion of adaptation in plans for many key infrastructure sectors”.

It contains repeated criticisms of

“a critical lack of relevant datasets to assess ... progress”

making it difficult to properly assess progress or evolving risk.

When will the Scottish Government realise that the success of its plans will not come from good headlines but from actually doing the hard work?

Michael Matheson (Scottish National Party, Falkirk West)

If the member’s interpretation of the report is that it is scathing about the Scottish Government, I wonder what that means for the UK Government and its failure in this area of policy, given the comments that the report makes about the United Kingdom Government and the fact that the Scottish Government is ahead of it in climate adaptation.

I am sure that the member, as we would often expect from the Opposition, will be selective about the aspects of the report that he chooses to mention. For example, he could pick up on the report’s highlighting of the progress that we are making in transport on rail and climate change and the way in which we are taking forward policies to provide greater resilience there; or the fact that

“Progress has been made in planning for adaptation in commercial forestry”,

which is, again, highlighted in the report; or a number of other areas where the report highlights that Scotland is demonstrating strong and clear leadership in those areas.

However, clearly, we need to do more. That is certainly what we intend to do, and we will respond to the recommendations in the report, which rightly raises the challenge that climate adaptation has to be measured against the same actions that we take when tackling climate change overall and that we need to make sure that they are treated in an equal fashion. That is why we are putting increased funding into a range of areas to help to support the embedding of our actions to tackle climate adaptation. We will look to do more of that as we move forward.

Willie Rennie (Liberal Democrat, North East Fife)

I do not think that most people would agree with the cabinet secretary that the measure of success is being marginally better than the Conservatives.

A vision counts for not very much when the action is not delivered. The report says very clearly:

“The majority of Scotland’s shoreline is not covered by Shoreline Management Plans”.

I am deeply concerned about many properties and a lot of land in my constituency. What is the cabinet secretary doing to make sure that those plans get delivered, and soon?

Michael Matheson (Scottish National Party, Falkirk West)

I concede that measuring ourselves against the Conservative Party in Government at Westminster is not a high bar to set. However, I assure the member that we are certainly doing more than the low bar that that Government consistently operates at.

The member may be aware that we are already taking forward the second phase of the dynamic coast project, which I launched in August last year, in Montrose. A key part of the project is the modelling work that is being undertaken to look at coastal erosion and the potential risks in individual parts of the country—no doubt including areas of the member’s constituency. That particular piece of work is being done to understand the areas of risk and the potential mitigations that need to be put in place in order to manage that risk.

That work is happening just now. The member will appreciate the complexity and some of the challenges involved but the dynamic coast project is there specifically to try to address the type of concern that the member has raised, and we are providing funding to try to support local authorities in taking forward some of the mitigation measures that are necessary in order to address the issue of coastal erosion.

Jackie Dunbar (Scottish National Party, Aberdeen Donside)

Does the cabinet secretary agree that, although there is clearly much more to do, the Scottish Government’s efforts and ambitions around tackling the climate crisis have been widely recognised, including by Chris Stark, the chief executive of the United Kingdom Climate Change Committee, who said on “Good Morning Scotland” recently that the Scottish Government “has been noticeably better” than other parts of the UK

“at putting a vision around ... what it wants to do to make Scotland more resilient”

in terms of climate, and also said that

“We don’t see that, for example, from DEFRA in the UK”?

Michael Matheson (Scottish National Party, Falkirk West)

I recognise that we are making progress on this. The report recognises that we are making progress on it but also calls for us to do more in order to show greater urgency in tackling the issue of climate adaptation.

We are doing more than other parts of the UK and we are further ahead than other parts of the UK, although I recognise that, at Westminster, the bar is low. Having said that, we also need to recognise that there are further measures that we need to take. That is why there is the £150 million for flood risk management and the £12 million for coastal adaptation that I referred to, as well as the investment that we are putting into areas such as peatland restoration. Those are all measures that help to support our climate adaptation work, alongside the investment of £60 million in climate adaptation on our trunk road network. However, we need to look at what more we can do to adapt to the changing climate that we face, and members can be assured that this Government is determined to do that and to continue to show the leadership that is necessary, not just here in Scotland or in the UK but internationally, on tackling climate adaptation.

The Deputy Presiding Officer

That concludes portfolio questions on net zero energy and transport. There will be a short pause before we move to the next item of business.

Ferguson Marine (Port Glasgow) Holdings Limited

Alison Johnstone (Presiding Officer, Lothian)

The next item of business is a statement by Kate Forbes on Ferguson Marine updates. The cabinet secretary will take questions at the end of her statement, so there should be no interventions or interruptions.

Kate Forbes (Scottish National Party, Skye, Lochaber and Badenoch)

The statement is in response to the report that has been published today by Audit Scotland and the updated ferries delivery schedule from the chief executive of Ferguson Marine, a copy of which has been sent to the Net Zero, Energy and Transport Committee.

We are crystal clear about what we expect from Ferguson Marine in terms of delivering vessels 801 and 802, as well as in terms of turning the business around to be competitive. I recognise the critical nature of completing 801 and 802 for the sake of island communities; like some other members, I come from the Highlands and Islands, and many of my family members and friends are dependent on lifeline ferry services. I understand the urgency and the necessity of delivering the vessels as quickly as possible.

We do not manage the yard directly, but the chief executive is accountable to the board and the board is ultimately required to deliver on our clear expectations for the business. I meet the chief executive fortnightly and I meet the chair every six weeks to press the board and the management to drive the programme as hard and as fast as possible, in order to successfully complete the vessels.

Let me be clear with Parliament: I expect the yard, as a priority, to complete the vessels successfully and at the fastest most achievable pace; to turn around its operations so that it is competitive, productive and efficient; and to win and secure a future pipeline of work on the basis of its operations

I also meet trade union representatives and the workforce, and have heard at first hand the impact on their morale of the challenges and of the very public criticism of the yard. Many of them have worked in the yard for decades; they know their trade and they know the yard. Their insights have been invaluable.

Parliament knows the challenge that we took on when we rescued Ferguson’s from administration in 2019, but we saved hundreds of jobs and the future of commercial shipbuilding on the Clyde. It was the right thing to do. We stand by our commitment to the shipbuilding communities in Inverclyde and to our island communities that rely on the vessels that the yard will deliver.

The challenges have been great. The initial report on the state of the yard in December 2019 set out the scale and depth of the business turnaround that would be required to put Ferguson Marine on to a stable footing. Undoubtedly, Covid has slowed the turnaround efforts. The yard has twice had to shut down due to Covid and has worked at reduced capacity for many months as a result of the necessary distancing requirements that were in place, Covid sickness absence and self isolation.

Despite the mammoth task, progress is being made. A new permanent chief executive has been in post since February, with fresh eyes and a new approach. He has created a more collaborative culture and is working more closely with Caledonian Maritime Assets Ltd, whose employees—it is well known—have had differences of opinion with Ferguson’s leadership about progress at the yard. The chief executive has bolstered his senior team with an experienced secondee from CMAL, thereby embedding a closer direct relationship with the yard. Crucially, the Ferguson Marine team is actively pursuing vessel opportunities and is back to being a serious contender for future vessel contracts.

It goes without saying that progress has not been as fast as we would have liked, which has been largely due to on-going legacy issues. The then turnaround director of Ferguson’s wrote to the Net Zero, Energy and Transport Committee on 9 February highlighting a legacy issue around cabling that would impact on the vessels’ schedule and cost. Those problems happened before Scottish Government ownership, and although the board has no visibility on work that happened before we brought the yard into public ownership, it is important that lessons be learned. The chief executive of Ferguson Marine has written to committee today quantifying the impact of that legacy issue. As part of his consideration of the delay that is associated with the legacy cabling, the chief executive has critically reviewed the delivery schedule in its entirety.

The cabling issue will cause a direct four-month delay on vessel 801. The chief executive believes that, given the emergence of legacy issues, an additional four months is required, and so his letter sets out that there will be a maximum delay of eight months in the delivery of 801. Delays on 801 will inevitably lead to delays on 802. However, Ferguson Marine believes that it can reduce the delay on 802 to six months, which means that 801 will be delivered between March and May 2023, and 802 between October and December 2023.

It is important to note that the estimates have been developed in collaboration with CMAL. I will not rehearse my frustration, nor Parliament’s frustration, about that updated timetable. The Ferguson Marine board and chief executive are aware of the depth of my dissatisfaction about the emergence of the cabling issue and the knock-on impact on the timetable. I have made it very clear that the vessels must be delivered in line with that schedule.

There is also a cost increase that comes with that extension of the programme. The chief executive has confirmed an additional £8.7 million will be required. Of that cost, £825,000 directly relates to cabling and £7.875 million relates to overhead, labour and material costs that are associated with the new schedule. As such, the cost to complete the ferries will increase to between £119 million and £123 million. I have agreed to additional funding to ensure that the vessels are completed.

I am also taking the opportunity to make provision for previously unbudgeted warranty costs of £3.5 million, to provide a builder’s warranty and warranty cover in respect of equipment whose warranties have time expired. That is completely separate to the cabling and schedule costs that I outlined above. The warranty costs were not unknown, but in the spirit of transparency I want to quantify those costs.

I turn to Audit Scotland’s report on the arrangements to deliver the ferries. The report reflects fairly on the complex issues that have mired the history of the build-out of the ferries and which underpin many of the legacy issues that Ferguson’s is dealing with today.

The report says that

“The turnaround of FMPG is extremely challenging”

and it highlights that

“FMPG has implemented some of the significant operational improvements that were required at the shipyard”.

Nonetheless, there is no denying Audit Scotland’s view that

“work on the vessels has taken longer than expected, and ... Covid-19 ... has delayed progress.”

I fully accept the Audit Scotland report’s recommendations on Ferguson Marine in public ownership, and work is already under way on a number of the recommendations. Collaboration between Ferguson Marine and CMAL has been considerably strengthened. Officials are working with Ferguson Marine on its business case for investment, and will continue to do so in order to deliver a competitive and sustainable business.

The Audit Scotland report makes reference to a range of reports and an appropriately complex governance structure. In the interests of openness and transparency, later today I will proactively publish documents on the Scottish Government website. I hope that those documents, as well as other contextual information, will help people who are in less proximity to the issues to understand the full picture.

Across the chamber, there is a shared belief in the importance of the vessels, so it is critical that we see them in service as soon as possible, for the benefit of our island communities. I reiterate that there are no ifs or buts—the vessels must be completed as quickly and effectively as possible.

The board and leadership of Ferguson Marine know where I stand on the issue, and they expect to be held to account for delivery of these crucial ferries, in line with the new schedule that they have communicated to Parliament today. Until those vessels are serving the communities for which they were built, we will not let up in our drive and determination to get them finished.

The Presiding Officer

The cabinet secretary will now take questions on the issues raised in her statement. I intend to allow around 20 minutes for questions, after which we will move to the next item of business. I would be grateful if members who wish to ask a question could ensure that their cards are in place and that they have pressed their request-to-speak buttons.

Graham Simpson (Conservative, Central Scotland)

I thank the cabinet secretary for the advance sight of her statement and a copy of the letter that Ferguson’s that was sent to the Net Zero, Energy and Transport Committee.

The Auditor General’s report is scathing. It should make uncomfortable reading for ministers and, frankly, they should be ashamed. We now learn from the cabinet secretary that, as well as further delays, extra costs of at least £8.7 million will be involved in the project to deliver ferries 801 and 802.

I am not going to give a big preamble, because we will come to a debate on ferries later, so I have just a few questions. Based on what the cabinet secretary has told us and what is in the Auditor General’s report, there is a bit of confusion over costs. The Auditor General says that

“the total cost of the ... project is currently estimated to be at least £240 million”,

which is significantly more than the cabinet secretary told us.

In addition to that, who is to blame for the cabling problem? I might have this wrong, but the cabinet secretary seems to suggest that it was the people who put the cabling in. I do not think that that is true. I think that the problem happened after the cables went in. Can the cabinet secretary give a clear and simple answer to that question?

Finally, on the report from the Auditor General, why did ministers ignore CMAL’s advice not to award the contract to Ferguson’s? Will the cabinet secretary now agree to hold a public inquiry?

Kate Forbes (Scottish National Party, Skye, Lochaber and Badenoch)

I will try to be brief with my answers, but I want to do those questions justice.

On the point around costs, I cited the cost to complete the ferries versus what was communicated to Parliament in December 2019. In terms of the overall cost, the member is right to cite the Audit Scotland figures; the cost on which I am updating Parliament is the total additional cost that is associated with the letter that has been communicated to Parliament today, which will be between £122.5 million and £126.5 million. That includes the entirety of the costs in terms of the warranty, today’s update and the costs that were previously communicated to Parliament for completion of the vessels. If there is still confusion, it is easy for me to set out the matter in a written communication to the member.

The cabling issue relates entirely to legacy cables. The cabling was installed by Ferguson Marine Engineering Ltd contractors in late 2018 and early 2019, which was entirely prior to the yard coming into public ownership. It was during planned electrical works for 801 that the issue with the length of the cabling was discovered by the yard.

The legacy cables issue relates to cables that were not already planned for replacement. I want to be clear that we are talking about legacy issues that arose prior to the yard coming into public ownership, and it is during the process of essentially commissioning the vessel that we are discovering where there are still issues. The cabling was installed by a reputable contractor, and the yard had no reason to suspect that there was a problem with it until it started to connect the equipment.

The member asked about an inquiry. The Audit Scotland report is comprehensive, thorough and fair. We have also had the Scottish Parliament committee report on an inquiry, which was chaired by the member’s colleague Edward Mountain. Therefore, there have been two fairly thorough inquiries into the issues.

If I recall correctly, the last point was around interventions by the Scottish Government at an earlier point. The member is shaking his head, so I think that I have answered his three questions.

Neil Bibby (Labour, West Scotland)

I thank the cabinet secretary for the advance sight of her statement. The problem is that islanders have heard it all before—more delays and rising costs. The ship has sailed on Scottish National Party excuses.

From the very start, ministers did not put in place the normal financial safeguards. Why? Can we get the latest total cost for both ferries in writing today? It is time for the Government to take responsibility. The cabinet secretary says that she is holding the new board accountable. I am sorry, but it is the cabinet secretary who is accountable.

We have heard again the tough talk about “no ifs or buts” and that the ferries must be delivered as soon as possible. The ferries are already estimated to be five years late. The reality is that the only chance that islanders have of seeing a new ferry this year is if they take a holiday to Marmaris.

The question for the cabinet secretary is, will she stake her reputation on this, or is it just more words? If it is not just words, will Kate Forbes confirm that, if the ferries are not ready by May and December 2023, she will resign? If she is not confident enough to stake her position on that, why should islanders have any confidence in what she is saying now? What is the point in her being responsible for the issue if she is going to keep passing the buck?

Kate Forbes (Scottish National Party, Skye, Lochaber and Badenoch)

I remind the member that, for the past five years, I have represented communities that rely on lifeline services. I am accountable to them, as we all are after every election. With regard to the “tough talk”, as he calls it, what we have committed to today is clear. The chief executive has updated Parliament on the updated schedule. Critically, and perhaps this is fairly new, that has been endorsed by CMAL. CMAL and Ferguson Marine are working together to ensure that we have a schedule that is achievable and that we can stand by and cost in order to deliver.

I have been clear with them that we expect the schedule to be delivered. I have set out the reasons for that schedule, as per the chief executive’s letter, and I have broken down the costs. However, as I said to Graham Simpson, if there is still confusion about the costs, I am happy to ensure that the information is committed to paper so that Neil Bibby fully understands it.

Kenneth Gibson (Scottish National Party, Cunninghame North)

I welcome the clarity in the cabinet secretary’s statement on why we are where we are and how we will move forward. When MV Glen Sannox and vessel 802 were ordered, my Arran constituents looked forward to a state-of-the-art vessel serving the island that would be much more resilient and reliable in bad weather. Can she confirm that, when the boat enters service, that will indeed be the case?

Kate Forbes (Scottish National Party, Skye, Lochaber and Badenoch)

The short answer is yes. Communities can have confidence that the vessels will perform in service and improve the network. They will not enter service before rigorous assessment has been done to ensure that they meet the required specifications from CMAL, which, as an adviser to the Scottish Government, maintains a presence in the yard. The vessels will not be handed over for delivery unless they are satisfactory and can deliver the requisite service. They will also not be able to enter service until they have received all the clearances that are required by the Maritime and Coastguard Agency and have classification society approval from Lloyd’s Register.

I hope that that gives Mr Gibson the clarity that he needs. I remind him that, when the vessels are delivered, they will aid my island constituents, too.

Elizabeth Smith (Conservative, Mid Scotland and Fife)

The whole ferries fiasco comes hard on the heels of plenty of other examples of SNP mismanagement of taxpayers’ money—the cases of Burntisland Fabrications, Prestwick airport and Rangers administrators, to name just three—and of Audit Scotland’s concerns that there is insufficient transparency from Scottish Government ministers about public spending. Will the Scottish Government commit to Scottish Conservative plans that ministers should open the books regularly and that we should have a formal finance bill procedure in Parliament so that we can have effective scrutiny of what the Government is spending taxpayers’ money on, in order that such a fiasco never happens again?

Kate Forbes (Scottish National Party, Skye, Lochaber and Badenoch)

We accept and agree with in full the recommendation in the Audit Scotland report on transparency and accountability, particularly when it comes to investments in private businesses. It calls on us, in line with the new framework for investing in private businesses, to improve the transparency of our investment decisions. Work is on-going on that, and we have already made changes. I am happy to update the member when that work is fully complete.

In relation to more general commitments, I take some issue with the member’s suggestion that work to complete the vessels and save the yard is, in her words, a waste. I stand by the decision to complete the vessels. We will complete them, and we have secured the future of the yard. The money that we are spending on completing the vessels is important money.

Alasdair Allan (Scottish National Party, Na h-Eileanan an Iar)

The cabinet secretary will be aware of the pressures on existing services and vessels that serve North Uist and Harris. Delays at Ferguson’s yard have certainly contributed to those pressures and to the human consequences of them. Can the cabinet secretary give an indication of how the new vessels will be utilised to alleviate some of the pressures and problems in my constituency and elsewhere?

Kate Forbes (Scottish National Party, Skye, Lochaber and Badenoch)

The member is right to highlight the vital role that the vessels will play and to confirm why it is critical to pursue their completion, contrary to what others might suggest. Those who have been most affected by the delays are those who live in his constituency and in other constituencies along the west coast, in particular.

We need the vessels to provide additional capacity and resilience, and we are already carefully considering the best deployment options in discussion with CalMac, CMAL and service users. Options include the potential for a two-vessel service for Harris and North Uist on the Skye triangle routes—that option was previously raised by those communities—although further consideration is required of the operation and affordability of that proposal. There is also the opportunity to consider maintaining a relief vessel in the fleet for a period of time.

In advance of the new tonnage being made available, the MV Loch Frisa, a new vessel, is expected to enter service soon, which will improve the Craignure to Oban route, particularly in the winter. It will also allow for additional sailings to be made on the Lochboisdale to Mallaig route and for additional capacity on the Mallaig to Armadale service.

Rhoda Grant (Labour, Highlands and Islands)

We all know, and the cabinet secretary knows, that the blame for the fiasco sits squarely with her Government. Will she guarantee to members that those boats will come into service for our outer island communities?

Kate Forbes (Scottish National Party, Skye, Lochaber and Badenoch)

As I said in my statement, I confirm that we are committed to getting the vessels completed and delivered. As I said, some people would prefer that we had given up, but we have not given up and we stand by our commitment to deliver the vessels.

John Mason (Scottish National Party, Glasgow Shettleston)

We absolutely must keep commercial shipbuilding on the Clyde. In her statement, the cabinet secretary mentioned the skills of the current workforce. Can she say anything about maintaining and building on those skills, for example through apprenticeships?

Kate Forbes (Scottish National Party, Skye, Lochaber and Badenoch)

Ferguson Marine boasts an impressive apprenticeship programme. Although the discussion about the work is now focused on the completion of the two vessels 801 and 802, the yard has delivered three smaller vessels since nationalisation—hull 803, hull 804 and hull 805.

On opportunities for apprentices, 43 apprentices are spread across various disciplines—welding, fabrication, mechanical fitting and design engineering—and 38 of them are working towards their level 3 Scottish vocational qualifications. In 2022, another 15 apprentices will join the programme.

Willie Rennie (Liberal Democrat, North East Fife)

The cabinet secretary tries desperately to distance herself from the ferries fiasco, but those ferries were contracted by Government-owned CMAL, paid for by the Government and built initially by a company that is celebrated by the Government—and the Government owned the company when it collapsed. However, no minister has ever faced the music. If the latest delayed deadlines are not met, will the cabinet secretary resign?

Kate Forbes (Scottish National Party, Skye, Lochaber and Badenoch)

Contrary to what Willie Rennie just said, absolutely no distancing is going on here. I have set out clearly and robustly in my statement that we are committed to completing the vessels for the sake of island communities, many of which I represent directly; to ensuring that the yard has a future; and to ensuring that we protect jobs. We stepped in to do that, and I stand by the 2019 decision to step in to ensure that neither vessels nor jobs were lost.

Stuart McMillan (Scottish National Party, Greenock and Inverclyde)

I welcome the secondee from CMAL to Ferguson’s, who will help with the job that needs to be done. It is important that the Scottish Government is clear in its expectations for the yard. However, the new chief executive has only recently been appointed. Does the cabinet secretary agree that it will be important for him to be given time, space and support as he begins to get the yard back on track?

Kate Forbes (Scottish National Party, Skye, Lochaber and Badenoch)

Stuart McMillan raises an important point. Ultimately, it is important that the people who are working on the ground in the yard, which includes worker representatives, employees more generally and yard leadership, inform our debates and discussions about the yard.

I have set out again my priorities for the yard’s management. We are engaging regularly with the new chief executive and, as a shareholder, we will continue to support the yard to achieve its goals in any way that we can. I reiterate the point that I have made today that the boats must be completed as quickly as possible. The board and leadership at Ferguson Marine know where we stand on that point. They have a plan in place; they have made substantial changes already; and progress has been made against Audit Scotland’s recommendations. We will continue to build on that progress.

Maggie Chapman (Green, North East Scotland)

The recent appalling behaviour by the bosses at P&O Ferries highlights the weaknesses of poor management and poor oversight of vital transport services, and points to the need for strong industrial relations. The cabinet secretary mentioned regular meetings with trade union representatives and their clear skills and expertise. How can we ensure that these workers play a key role in future work that is vital for the long-term sustainability of the yard and their jobs? How can we reassure people who rely on lifeline ferry services that the deprioritisation of service support in next year’s budget will not have a negative impact on the delays and cost escalations that were announced today?

Kate Forbes (Scottish National Party, Skye, Lochaber and Badenoch)

As I said in my statement, input from workers and trade union representatives has been invaluable as we try to get to the bottom of what is needed to make progress at the yard. I have valued their input and meeting them at the yard itself.

The input of workers and trade union representatives, management and CMAL has ensured that we have been able to make progress. We clearly need to build on that and complete the vessels. Ultimately, our three priorities for the yard are completing the vessels, turning the yard around and saving jobs. Had we not intervened, that would not have been the case.

Jenni Minto (Scottish National Party, Argyll and Bute)

In order for it to successfully win new contracts, it is important that work to increase the yard’s efficiency and competitiveness continues. Will the cabinet secretary provide an update of the steps that Ferguson’s is taking to improve its competitiveness?

Kate Forbes (Scottish National Party, Skye, Lochaber and Badenoch)

The best way to secure a sustainable future for the yard is to ensure that it can compete for contracts on merit. We are working with the yard to support the development of a business case for investment to help to improve competitiveness, which is another recommendation of the Audit Scotland report.

Driving up day-to-day productivity is rightly an operational matter for the yard. From my discussions with the chief executive and chair, I know that the yard is already doing that as part of the programme that we set up. The yard has set quite clear targets for more efficient work planning so that the use of labour and materials is better focused. One small example of that is the creation of the permit-to-work office on the ship, so that walking on and off ship is minimised.

A lot of investment has been made and there has been a lot of progress. We must keep driving ahead so that Ferguson’s can secure a long-term future.

Jamie Greene (Conservative, West Scotland)

Here is a straightforward question. If the Scottish Government is so keen for Scotland’s proud shipbuilding history to flourish in the modern age, why on earth are we building our new ferries in Turkey and not on the Clyde?

Kate Forbes (Scottish National Party, Skye, Lochaber and Badenoch)

I have two things to say to Jamie Greene. Based on the questions of some of his colleagues this afternoon, some people might assume that he would have preferred shipbuilding on the Clyde to be shut down a number of years ago. There is therefore an irony at the heart of his question. Through Government interventions, we protected shipbuilding on the Clyde in the first place.

The second point is on the procurement that Jamie Greene asks about. Ferguson Marine is working to complete the two vessels, and it is important for island communities that those vessels are completed. It is also important that we do not wait to procure two new vessels. I am sure that we will hear during the course of the debate this afternoon how critical it is that we supplement the vessels that are available.

We have made progress in procuring two new vessels, and I do not think that island communities want us to wait.

Katy (Labour, West Scotland)

Islanders on Arran and other islands were asking for smaller vessels. Does the cabinet secretary now agree with the views of many that Ferguson Marine should have been awarded contracts for smaller, simpler ferries, which could have been constructed far more speedily for those islands?

Kate Forbes (Scottish National Party, Skye, Lochaber and Badenoch)

The member is right. In the period since nationalisation, Ferguson Marine has completed three smaller vessels, which demonstrates that there are skills and capability at the yard.

I am sure that this afternoon’s debate will cover ferry policy in more detail, and it is really important that the needs of communities are taken into account when it comes to procurement and design. That is essential. Vessels must be built for the purposes for which they are required. When a smaller vessel is more important, we should go with that, rather than building a vessel around a yard’s capabilities.

Liam Kerr (Conservative, North East Scotland)

Given that the warranty on the engines for vessels 801 and 802 has lapsed, when did the Scottish Government first become aware of potential issues with the dual-fuel engines? Will the cabinet secretary comment on claims that they are now old technology, given the fact that they are already seven years old?

Kate Forbes (Scottish National Party, Skye, Lochaber and Badenoch)

I am sure that I recently answered a written question from Liam Kerr on the same issue, so he will have that in writing. However, I am happy to respond again.

In terms of the provision that I have announced today for unbudgeted warranties on warranty-expired equipment and builders’ warranties, those were already known about. Today, we have announced an estimate based on 5 per cent of the £70 million equipment costs, to ensure that there is as much transparency as possible around costings. When the vessels begin commissioning, which is targeted for May, that will be the ultimate test of equipment on board that might not have been used because the vessels are being constructed. That is why today’s updated schedule takes into account the need to test legacy issues.

The Presiding Officer

That concludes the ministerial statement on Ferguson Marine updates.

Ferries

Alison Johnstone (Presiding Officer, Lothian)

The next item of business is a debate on motion S6M-03712, in the name of Graham Simpson, on Scotland’s ferries.

Graham Simpson (Conservative, Central Scotland)

When the then Rural Economy and Connectivity Committee published its report on the construction and procurement of ferries in Scotland in December 2020, it concluded that there had been

“a catastrophic failure in the management of the procurement of vessels 801 and 802, leading it to conclude that these processes and structures are no longer fit for purpose.”

That was no small claim from a cross-party committee, and one that should have made the Scottish Government and all its agencies sit up and take notice.

The committee called on the Scottish Government to commission an independent external review of the processes for public procurement of ferries. The Government did so. That report, “Project Neptune”, has been completed by Ernst & Young and is being sat on by Transport Scotland. Jenny Gilruth promised to publish it when I asked her about it last month, yet Transport Scotland continues to get its way. We demand that it be published in full immediately.

The Rural Economy and Connectivity Committee also called for the management of the ferries contract and the role that was played by Transport Scotland to be reviewed by Audit Scotland. That review has taken place and its conclusions, which have been published today, are damning. I will start with that, but I will also deal with the wider issues because at the heart of the matter is the fact that the Scottish National Party Scottish Government is letting down islanders and those who need to get to islands. That cannot go on.

Today, the Auditor General has been scathing in his criticism. His report lays bare the shambles of the contract to build the two ferries. Ministers were warned not to give the contract to Ferguson’s. The cost is two and a half times the original budget, and ministers are tied into paying whatever it takes. The cost could go higher—it has done today, by £8.7 million, which is not a drop in the ocean. There are major failings at the shipyard that still need to be resolved. The Auditor General’s report leaves the SNP holed below the waterline when it comes to its record on ferries.

Today, Stephen Boyle said:

“The failure to deliver these two ferries, on time and on budget, exposes a multitude of failings. A lack of transparent decision-making, a lack of project oversight, and no clear understanding of what significant sums of public money have achieved. And crucially, communities still don’t have the lifeline ferries they were promised years ago.

The focus now must be on overcoming significant challenges at the shipyard and completing the vessels as quickly as possible. Thoughts must then turn to learning lessons to prevent a repeat of problems on future new vessel projects and other public sector infrastructure projects.”

Of course, the Auditor General’s report says what we already know—that the project to deliver the two new ferries has been fraught with problems and delays over six years. Vessels 801 and 802 were originally expected to be delivered in May and July 2018 respectively, but they are now almost four years late, and we have heard about a further delay.

The total cost of the project is currently estimated to be at least £240 million—that was confirmed earlier—which is two and a half times the original vessels’ budget, and there is apparently no limit to the final cost, despite what the cabinet secretary said earlier. According to the report, the Government is committed to paying any extra costs

“regardless of the final price.”

The Scottish ministers announced Ferguson Marine Engineering Ltd, which I will refer to as FMEL, as the preferred bidder for the £97 million fixed-price—“fixed-price”; if only!—contract to design and build the two vessels in August 2015.

The contract notice for the design, construction and delivery of the vessels was advertised in October 2014. We have been told today that both boats will be delivered next year. Even if that is true, it will have been nearly 10 years in total by the time they take passengers. We have designed and built rockets to take us to the moon and back more quickly than that.

The Auditor General says that, in September 2015, FMEL confirmed that it was unable to provide Caledonian Maritime Assets Limited—CMAL—with a full refund guarantee, which was one of the mandatory requirements of the contract.

Although CMAL subsequently negotiated a partial refund guarantee with FMEL, it remained concerned about the significant financial and procurement risks that that created. CMAL had the option to reject the bid at that point, and it told Transport Scotland that it wanted to restart the procurement process.

Transport Scotland alerted Scottish ministers to CMAL’s concerns and to the risks of awarding the contract to FMEL. The Auditor General says:

“There is insufficient documentary evidence to explain why Scottish ministers accepted the risks and were content to approve the contract award in October 2015.”

CMAL thought that there were too many risks to award the contract, but the Government thought that it knew better. Why, when the Ferguson’s bid was the highest, and when the Government’s ship-buying arm said no, did ministers plough ahead? I asked the cabinet secretary that question earlier, but I got no answer.

Kenneth Gibson (Scottish National Party, Cunninghame North)

Did the Conservative Party oppose the awarding of that contract to Ferguson Marine at the time?

Graham Simpson (Conservative, Central Scotland)

I say to Mr Gibson that ministers should listen to the experts. Perhaps if they had listened, we would not be in this mess, and we would not now be ordering ferries from Turkey.

Stuart McMillan (Scottish National Party, Greenock and Inverclyde)

Will Graham Simpson take an intervention on that point?

Graham Simpson (Conservative, Central Scotland)

No.

There was then the £45 million loan to FMEL; we do not know what good that did. As things went belly up, the Government decided to nationalise the yard, but it had absolutely no idea what the condition of the boats was when it did so, so it could not have predicted how costs would rise.

Despite advice from PWC, there was no exit strategy—a bit like the situation with Prestwick airport. That is scandalous. Throughout the process, the various parties have been squabbling like children, unable to get on. There have been a string of disasters, with the latest being the discovery that the cables that were fitted on the vessel that was launched with blacked-out windows by Nicola Sturgeon in 2017 are now too short.

No one has accepted blame for that, or for anything in this fiasco. Ministers and others—including the highly paid and mistitled turnaround director—have moved on, but nobody’s head has rolled. That is the problem. There is no accountability—none—not just in Ferguson’s, but in the entire ferry system and especially in Government. To get to the bottom of that, we need a public inquiry.

There is a telling sentence in the Audit Scotland report, which states:

“The two new vessels, and subsequent additions and disposals, were expected to reduce the average age of CMAL’s major vessel fleet from 21 years ... to 12 years by 2025.”

How are we doing on that? The average age of the CalMac Ferries Ltd fleet is 23 years. The situation has got worse, and nobody’s head has rolled. We need new ferries, and we need to increase the budget for that in order to catch up. Graeme Dey reckoned that it would take £1.5 billion over 10 years; we are saying that it requires £1.4 billion. That would create a pipeline of work that could herald a boost for Scottish shipbuilding.

This is not some obscure topic. Having an ageing and unreliable ferry fleet affects people’s lives. This week, I have been speaking to island campaigners on Arran, Mull and Iona. A psychotherapist told me that he is dealing with increasing numbers of stressed-out patients. Other people have said that they have not been able to get to hospital appointments, because they cannot book a car space less than a few weeks in advance. The situation is also affecting tourism.

I have heard of bare shelves in shops, and I have seen the photographic evidence. Farmers cannot get feed and cannot get their animals to market. It goes on. Kids cannot get to school. People are thinking of giving up island life altogether—under the SNP.

Rachael Hamilton (Conservative, Ettrick, Roxburgh and Berwickshire)

Does Graham Simpson believe that the issue could be contributing to island depopulation?

Graham Simpson (Conservative, Central Scotland)

I just said that. People are now thinking of giving up island life altogether. That is tragic.

I will end with a personal testimony from a lady on an island that I have not mentioned so far: Cumbrae. She told me:

“We are only an 8 minute journey from the mainland and this nearness, and our small size, results in a heavy reliability on the mainland. We do NOT have the infrastructure on the island that other islands have. Residents require to travel to the mainland for secondary schooling, work, medical, dental, optical and veterinary services, as well as supermarket food shopping and PETROL! The service in recent months has been the worst in living memory. I am aware of a lady who missed a mastectomy operation due to a sewage issue on the ferry and at least 2 other ladies that have had their Chemotherapy impacted. We need a solution now!”

I disagree with that lady. We needed a solution long before now.

I move,

That the Parliament believes that islanders, island economies and all those reliant on vital ferry links are being severely let down by the failure to deliver a resilient ferry fleet; calls on the Scottish Government to increase funding to build new ferries in the next five years and to commit to spending £1.4 billion in the next 10 years in order to bring down the average age of ferries and to upgrade ports; is deeply alarmed and disappointed with the late arrival of new operational vessels for the Clyde and Hebridean routes; understands that the construction of vessels 801 and 802, which were due to be delivered in May and July 2018 respectively, are severely delayed; notes with disappointment that the Scottish Government has yet to confirm a revised timetable for the completion of vessels 801 and 802, following the identification of issues with the cabling; believes that the Scottish Government has made insufficient progress on acting on the recommendations set out in the report by the Rural Economy and Connectivity Committee, in Session 5, on ferry construction and procurement; calls upon the Scottish Government to publish an unredacted copy of the Project Neptune report compiled by Ernst and Young, and further calls for a full public inquiry into the Scottish Government’s failure to renew the ageing ferry network based on a workable ferries plan.

The Presiding Officer

I call Jenny Gilruth to speak to and move amendment S6M-03712.2.

Jenny Gilruth (Scottish National Party, Mid Fife and Glenrothes)

I thank Graham Simpson for securing this important debate on Scotland’s ferries, which is timely, given the Cabinet Secretary for Finance and the Economy’s statement on the Audit Scotland report this afternoon.

It is necessary that, as transport minister, I listen to the Opposition and engage collaboratively on the best way forward. Mr Simpson and Mr Bibby know that I am adopting that approach to public ownership of Scotland’s railways, so it will not surprise either of them that it is in that spirit that I intend to make the changes that are required to build resilience in our ferry fleet and to provide reassurance to our island communities.

I know that for our island communities, our ferries are not just boats: they are lifeline services that bring food and vital supplies. They facilitate onward journeys to family and essential hospital appointments, as we have heard. They are a bridge across our sometimes tumultuous seas and it is vital that the Government—where it has responsibility and accountability—gets this right for people who live on our islands.

I want, therefore, to start with an apology. I am sorry that, this winter, islanders have not been provided with the services that they deserve and to which they should have access. I am sorry that their needs have not always been fully met. I am sorry that when things have gone wrong, islanders have often not always been communicated with appropriately or in a timely fashion.

I am acutely aware of the need for Government—and CalMac—to improve in that regard. Although I cannot wave a magic wand and make our fleet more resilient overnight, I am intent on delivering a better service. Working with our island communities, I will explore every possible avenue to do just that.

I have heard loud and clear the concern and difficulties that have been faced in the recent prolonged period of disruption. It is important to reflect on the combination of an unprecedented series of named storms and the considerable disruption on the network resulting from the impact of the pandemic.

On weather, when I say “unprecedented”, I note CalMac’s own observation that there was more weather disruption in the first seven weeks of 2022 than there was in the whole of 2012. In much the same way as it is impacting on our railway network, climate change is impacting on our seas and our ferry fleet. Indeed, weather and Covid-related incidents combined accounted for 92.75 per cent of the disruption that was experienced in January and February alone. Although it is important to note that those disruptions were caused by factors that are outwith our control, the impact of extended maintenance requirements and breakdowns, which were due in part to the age of the fleet, must also be addressed, so I will come to that shortly.

Liam Kerr (Conservative, North East Scotland)

When will the “Project Neptune” report be released?

Jenny Gilruth (Scottish National Party, Mid Fife and Glenrothes)

I will come to that shortly. I have already given Mr Simpson an assurance that it will be published in due course.

Although I note the undeniable challenges that are faced by Scotland’s ferry fleet, I want to express my on-going thanks to the crews and staff of CalMac, who have been working hard in extremely challenging circumstances. I am sure that members from across the chamber will join me in expressing that sentiment. As the Government amendment notes, that includes commending

“the vessel masters for the key role that they are trained to play in ensuring people’s and vessels’ safety with the decisions that they make about how and when ferries can sail”.

Regardless of the reasons for cancellations, the impact on communities is clear, whether we are talking about lack of fresh produce in local shops or missed hospital appointments on the mainland. We must do everything that we can to avoid or mitigate service cancellations on the network.

Alasdair Allan (Scottish National Party, Na h-Eileanan an Iar)

I appreciate the tone of much of what the minister has said about accepting the need for more responsiveness on the part of CalMac and CMAL. Does she agree that both organisations would be more responsive to communities if any of their board members had to use a CalMac ferry in their daily life?

Jenny Gilruth (Scottish National Party, Mid Fife and Glenrothes)

I recognise Dr Allan’s interest in the matter, given his constituency. I am broadly sympathetic to his suggestion, but I do not want to make a decision on it right now, in the chamber. I recognise the challenges to do with getting islanders’ voices to inform the work of CalMac.

I want to talk about services that have been impacted. We heard about services to Arran, and I am well sighted on the difficulties on Barra, Cumbrae, Coll and Tiree. I will meet CalMac next week, following our initial meeting last month, to raise concerns directly and seek an action plan for improvement. I make an offer to members who would like me to raise constituency cases with CalMac directly: I ask them to email my private office, and I will ensure they receive an update and an assurance from CalMac that their concerns have been adequately addressed.

I have asked CalMac for regular briefings regarding service cancellations. I have also requested, through officials, an up-to-date understanding of the approach to Covid on vessels and the impact that that has had. The issue has been raised with me.

There is, furthermore, a need for joined-up cross-portfolio work on resilience. With the Cabinet Secretary for Rural Affairs and Islands, I have set up work across Government to establish what more can be done to prepare better for known resilience events, by building on the already well-established engagement between Government and local resilience partnerships.

It is important to note that the age of the fleet has been a significant contributing factor in cases of breakdown or extended periods of maintenance or dry-docking. Ministers recognise the need to address delays in investment in ferries infrastructure, which is why we committed £580 million in the infrastructure investment plan.

Graham Simpson (Conservative, Central Scotland)

Will the minister give way?

Jenny Gilruth (Scottish National Party, Mid Fife and Glenrothes)

I want to make progress, but I will give way to Mr Simpson.

Graham Simpson (Conservative, Central Scotland)

I am grateful. Does the minister recognise concerns that £580 million is nowhere near enough and that the budget needs to be at least doubled?

Jenny Gilruth (Scottish National Party, Mid Fife and Glenrothes)

I recognise what Mr Simpson argues for. I also note that the Conservatives voted against the Scottish Government budget, which increased funding for our ferry services and support to improve our ports.

Neil Bibby (Labour, West Scotland)

Will the minister take an intervention?

Jenny Gilruth (Scottish National Party, Mid Fife and Glenrothes)

I want to make progress, if Mr Bibby would allow me to do so.

The investment will enable delivery of improved infrastructure, including three ports on the Skye triangle, to bring greater resilience and allow a wider range of vessels to be used. It also supports delivery of the new Islay vessels and associated port improvements, with both elements allowing increased capacity alongside improved efficiency on the route. The Islay programme was developed following detailed community engagement, which led to a decision to invest in a second vessel.

We have also been able to use the investment to realise an opportunity to secure an additional vessel in the fleet—MV Utne, now MV Loch Frisa—following extensive worldwide searches of the market by CMAL.

Jamie Halcro Johnston (Conservative, Highlands and Islands)

Will the minister take an intervention?

Jenny Gilruth (Scottish National Party, Mid Fife and Glenrothes)

I want to make progress.

The purchase of the additional vessel secures an island-focused year-round timetable, as was requested by the Mull community. It also frees up other vessels that can improve services to Skye and South Uist. The actions have been welcomed by local communities.

CMAL, Transport Scotland and CalMac continue to work with communities and key stakeholders across the network to develop the required projects to a point at which they are ready for investment.

I recognise that we have been criticised for not engaging early enough with communities on such decisions. I hope that the work that I have described demonstrates that we have made significant improvements to our approach—a point that the ferries community board noted with reference to the Islay vessel experience.

Jamie Halcro Johnston (Conservative, Highlands and Islands)

Will the minister take an intervention on that point?

Jenny Gilruth (Scottish National Party, Mid Fife and Glenrothes)

I would like to make progress.

Since 2007, our investment in ferry services has exceeded £2 billion, to provide new vessels and improved infrastructure and to underpin our Clyde and the Hebrides and the Northern isles ferry services.

Since the ferries plan was published in 2012, we have seen the addition of new routes, including to Campbeltown and Lochboisdale, as well as significantly increased frequency of sailings on routes to Arran and Mull.

The islands connectivity plan offers the Government—and, I think, the Opposition—the next opportunity for greater delivery for our island communities. The ICP will be published later this year and will replace and enhance the current ferries plan. It will build on the ferries plan’s progress and will refresh the strategy that guides the ferry services for which the Scottish Government is responsible. When it is published, it will cover a long-term investment programme for ferries and ports, which will aim to improve wider resilience. Engagement is already under way on it—

Neil Bibby (Labour, West Scotland)

Will the minister take an intervention on that point?

Jenny Gilruth (Scottish National Party, Mid Fife and Glenrothes)

I would like to make some progress.

Discussions took place this morning with stakeholders from both networks. I again wish to provide the Opposition with an opportunity to feed into the ICP’s development, as was the case on rail, and I would welcome the chance to speak directly to party spokespeople.

Jamie Halcro Johnston (Conservative, Highlands and Islands)

Will the minister give way?

Jenny Gilruth (Scottish National Party, Mid Fife and Glenrothes)

I am aware of the time—I think that I have 10 seconds left.

That discussion could better ensure a collaborative approach, going forward.

I assured Mr Kerr that I would come to “Project Neptune”. As part of our drive for strategic improvement, we commissioned an independent review—which was alluded to by Mr Simpson—of the current legal and governance arrangements for the existing tripartite of Transport Scotland, CMAL, David MacBrayne and its subsidiary, CalMac Ferries Ltd, which currently operates the Clyde and Hebrides ferry services, or CHFS, network.

As Mr Simpson knows, I have committed to making a statement to Parliament to that end. I received the report from officials late last week and, along with the relevant Audit Scotland recommendations, we will now consider options for reform and improvement. “Project Neptune” potentially offers options for structural changes to how we deliver some elements of our ferry services.

Given the complexity of that and given what each option might mean for the bodies and staff involved, I will not set out the detail of that today, but I want to reassure members that I will be launching further engagement with key stakeholders on those options, following a statement to Parliament, as was previously committed to.

I recognise the vital importance of Scotland’s ferry network to our island communities. It is imperative that the Government gets it right—and that it is honest when we do not. As Minister for Transport, I am absolutely committed to listening to the needs of our island communities and acting to make the improvements that are necessary.

I move amendment S6M-03712.2, to leave out from “believes that islanders” to end and insert:

“agrees that ferry services provide an essential lifeline to island and remote rural communities and their economies; recognises that, through adverse weather events and COVID-19 causing many cancellations on the Clyde and Hebrides Ferry Services routes, this has been a challenging winter for island residents, businesses and communities; commends the vessel masters for the key role that they are trained to play in ensuring people’s and vessels’ safety with the decisions that they make about how and when ferries can sail; acknowledges that technical issues causing some vessels to be further laid up have added to people’s frustrations and inconvenience; notes that, since 2007, over £2 billion has been invested in service contracts, new vessels and infrastructure and that, in the current five-year period, a further £580 million has been committed, enabling harbour investments, two new vessels for Islay to be built and the purchase of the MV Loch Frisa; further notes the Scottish Government commitment to publish the Islands Connectivity Plan by the end of 2022; welcomes that the Scottish Government saved Ferguson Marine, the last commercial shipyard on the Clyde, from closure, rescuing more than 300 jobs and ensuring that two new ferry vessels will be delivered, while noting the planned revised timetable and costs for completion of these two vessels; condemns the recent actions by P&O Ferries in the strongest possible terms, and makes clear the Scottish Government’s support for P&O Ferries employees, and agrees that ‘fire and rehire’ practices should be outlawed and have no place in a fairer, greener Scotland.”

Neil Bibby (Labour, West Scotland)

At the outset, I welcome the Scottish Government’s reference in its amendment to the situation at P&O Ferries. Labour MSPs, whether here in Parliament today or earlier at Cairnryan, stand shoulder to shoulder with the workers and their unions, the National Union of Rail, Maritime and Transport Workers—the RMT—and Nautilus. P&O executives have behaved utterly disgracefully and should be hunted down to the full extent that the law allows. The situation should never have been allowed to happen and, as Labour’s front bench in the House of Commons has made clear, it would not be happening if there was a Labour Government. P&O executives must be held accountable for their actions.

Speaking of accountability, I welcome this afternoon’s debate, led by Graham Simpson. The ferries fiasco is one of the biggest issues facing Scotland today, and it is one that the Scottish Government has been dodging for too long. The ship has sailed on the SNP’s excuses. Scotland’s ferries fiasco is a national humiliation. A Scottish yard supporting Scottish jobs and owned by the Scottish Government has failed even to make the shortlist to build ferries in Scotland. It is a national humiliation that has serious and profound local consequences.

Reliance on an ageing CalMac fleet means that islanders have to endure the human cost of breakdowns and delays, with young people missing school, sick people missing hospital appointments, families being kept apart and island businesses losing incomes. We have all seen the pictures of island supermarket shelves lying empty. All those things are threats to island life, as Graham Simpson said. The situation undermines efforts to reverse depopulation, and it damages fragile island economies.

Islanders who are waiting on new vessels on the Clyde and Hebrides routes—vessels that are already four years behind schedule and two and a half times over budget—deserve a profound and meaningful apology from the Government for its failures over the past 15 years. I welcome the fact that the Minister for Transport had the grace to apologise for the disruption this winter.

There must be concerted action from the very top in order to put the matter right. There was a time when senior SNP politicians could not get themselves down to Port Glasgow quickly enough to have their photo taken; now, they cannot run away quickly enough from their responsibility for the shambles. Earlier, Willie Rennie and I both asked the Cabinet Secretary for Finance and the Economy whether she would stake her position on timely completion of the new vessels. She refused to do so on both occasions. Perhaps the Minister for Transport will take responsibility instead. If not, it is clear that nobody in the Government will take responsibility.

In fact, there has been a ministerial merry-go-round throughout the fiasco. Alex Salmond was down there in 2014. Derek Mackay had his photo taken outside the yard in 2017. Nicola Sturgeon launched a ferry with painted-on windows that was still unfinished. Fiona Hyslop fell out with the union. Michael Matheson, Humza Yousaf and Graeme Dey have all come and gone—unlike the boats—and last week Ivan McKee was answering questions on the issue. Today, Kate Forbes gave the statement and Jenny Gilruth has spoken in this debate. The previous owner is away and the turnaround director is away.

The one constant throughout has been the First Minister, and the First Minister is ultimately accountable for the Scottish Government. That is why Scottish Labour is calling for the First Minister to assume direct ministerial responsibility for the Government’s investment in Ferguson’s: no one else is taking responsibility. Nicola Sturgeon needs to lead from the front, turn Ferguson’s around and bring her Government’s ferries fiasco to an end. That means the Glen Sannox being fully operational with no more delays, followed by vessel 802. The completion of those vessels is essential to rebuilding confidence in Ferguson’s and helping the yard to bid for new work.

On the question of confidence in Ferguson’s, let me say this: today’s Audit Scotland report will make for difficult reading for many people. Ultimate responsibility lies with the Government, but there is plenty of blame to go around.

There is no question, however, about the dedication and professionalism of the Ferguson’s workforce. It got on with the job as best it could in extremely difficult circumstances. It deserves better and needs to know that the Government is committed to completing the vessels. It needs assurances that the new management set-up will make the yard more competitive and bring new opportunities to the lower Clyde.

Our appeal to the Government is that it complete the ferries and ensure that the yard can bid for new work. That must include the opportunity to be part of a much-needed ferry building and replacement programme. We need to build more ferries, but since 2007 this Government has built only six new ferries in 15 years, compared with the 10 new ferries that were built by the previous Labour and Liberal Democrat Administration. We need a programme to rejuvenate our ageing fleet and ensure that new ferries are built in Scotland. I ask the minister and cabinet secretary to consider the case for simpler and smaller models being built on the Clyde in order to help to fill order books.

The test for the future viability of Ferguson’s should not be at the mercy of a vessel that is as complex to build as the Glen Sannox. I encourage the Government to engage with the GMB union on the potential for new roll-on, roll-off ferries to be built on the Clyde and deployed in the CalMac fleet. I say again that if concerns about the workforce had been addressed at an earlier point in this fiasco, perhaps the delays and overspends that have dogged the project could have been avoided. That underlines the need for the workforce and islanders to be adequately represented in the governance of the ferries network. There should be an urgent review into the suitability of the CMAL-CalMac model. It was designed in another time for another time.

I want to acknowledge that although today’s Audit Scotland report usefully sets out the scale and nature of the failings at Ferguson’s, it does not answer all our questions. It does not look into tender documents or in any depth at the reported changes in procurement and design once construction had been approved. It has not been able to interrogate in much greater depth the breakdown in the relationship between CMAL and Ferguson’s. It has not been able to establish whether it was reasonable to pay a turnaround director £2,783 per day, and it could have interrogated what ministers knew and when, and why on earth they did not put in place normal financial safeguards.

There is another way to get those answers and to ensure that lessons are learned from the fiasco—a full public inquiry. There was a public inquiry for the Edinburgh trams because the costs doubled. Costs in this case have more than doubled. There would be no hiding from scrutiny in a full public inquiry. Key witnesses such as Derek Mackay and the First Minister herself did not appear before the Rural Economy and Connectivity Committee inquiry, so Scottish Labour supports calls for an inquiry.

Labour supported the decision to save the Ferguson’s yard from closure. We applaud the extraordinary effort that has gone into keeping Ferguson’s open and keeping the workers in jobs, but in failing to oversee the project adequately, the Government is failing those workers. There must be a better future for the workforce at Ferguson’s, for the lower Clyde and for our island communities. To unlock that future, we call on the First Minister to step in and turn the yard around.

I move amendment S6M-03712.1, to insert at end,

“; considers that a Scottish Government apology should be issued to island communities and the Ferguson Marine workforce, who have been affected by failures in the procurement and delivery of vessels 801 and 802; calls on the First Minister to lead government efforts to secure the completion of vessels 801 and 802 by taking ministerial responsibility for government investments in Ferguson Marine; believes that a national ferry building and procurement programme, developed in consultation with trade unions, should create new opportunities for Ferguson Marine to secure ferry contracts, and calls on the Scottish Government to protect jobs and promote sustainable growth and fair work in Scotland’s marine economy.”

Willie Rennie (Liberal Democrat, North East Fife)

The ferries fiasco is a national embarrassment of the SNP’s making. The ferries are four years late and after today will be five years late, at two and a half times the original budget. Windows were painted on just for the First Minister, cables were too short and a bulbous bow was too small. There has been endless squabbling, and now there is a damning Audit Scotland report.

The embarrassment is never ending, but it is not just an embarrassment. The situation has a real-world effect on islanders, taxpayers and the workers at the shipyard. The effect on islanders is significant; breakdowns and cancellations are commonplace. That is not a surprise, though, given the ageing ferry fleet, much of which was built on the lower Clyde in the days of Margaret Thatcher. Who would have thought that Margaret Thatcher would have a better shipbuilding record than the SNP? Yet she did.

The delays today could have been avoided if the SNP had had a proper ferry-building plan to replace the ageing fleet, but it did not. The delays almost every day could have been avoided if the SNP had built the ferries when it promised to—five years ago—but it did not. The repeated delays could have been avoided if the SNP had managed to get the ferries built in 2018, 2019, 2020 or even 2021. All of those were dates for completion promised by the SNP, but it failed over and over again.

Even now, the date has been delayed until next year. “Not more delays, cancellations and breakdowns through another cold Scottish winter,” I hear the islanders cry. One said:

“The fiasco with procurement and the ageing fleet is going to get worse rather than better in the next number of years. It’s horrendous.”

The people who are waiting for the new ferry for Arran will just need to wait longer. Those who are waiting for the new ferry to Skye will need to wait even longer. “The Skye Boat Song” would never have been quite the same without the boat.

The delays are long and tortuous, and the costs have shot through the roof. Patients, children and the homeless will just have to watch as the Scottish Government spends ever greater sums of money on two ferries that are still not complete. The costs have rocketed from £97 million to £240 million, and possibly to an estimated £400 million—four times the original price.

Let us put that in context. It would pay for seven high schools for children who are desperately waiting to move from their damp-ridden buildings. It would buy 2,000 council houses for those who are desperate for a home. It buys just one new children’s hospital in Edinburgh—but that is another story. The SNP seems to think that it is okay for all those people to wait and watch it bungle contracts for building ships on the Clyde. The issue has got so embarrassing for the SNP that it even refused to be interviewed by the BBC about the matter.

However, that is nothing compared with the embarrassment that it feels now that the SNP-owned ferry company is not even bidding to build its own ferries. Those ferries will be built by Turkish yards and benefiting Turkish workers, Turkish taxpayers and Turkish communities. I have heard some say that the new slogan should be “SNP: Stronger for Turkey”.

Because the situation has got so desperate and embarrassing, the SNP is reaching for Boris Johnson’s playbook on building bridges: it now wants to build one to Mull. If the minister is listening, I say to her that she should get on with building the fixed links in Shetland, which wants them, instead of Mull, which does not.

All of this is a prime example of a failed SNP industrial intervention strategy. It intervened with Burntisland Fabrications before the company collapsed. It is exposed to the tune of hundreds of millions of pounds at the Lochaber smelter and the 2,000 jobs are nowhere to be seen. It has spent millions on Prestwick airport, but still cannot sell it. It is potentially exposed to millions of pounds for the environmental clean-up at the Lanarkshire steel mills. It also seems incapable of handling relationships with business. It was duped by the £10 billion Chinese deal that never was. It tried to renege on a deal with Tata Steel over clean-up costs. Now it is not even able to train enough workers to build just eight wind turbine jackets in Fife.

The SNP’s record on ferry building is just one example of a series of industrial-sized failures. It is the workers, the taxpayers and the islanders who will lose out. We need a new plan for ferry construction, new investment to replace the ageing fleet, a turnaround plan that works for Ferguson’s, a Government that delivers on its promises and a public inquiry into this utter shambles, but I suspect that, like everybody else, we will be kept waiting ever longer before we get any of those things.

Liam McArthur (Liberal Democrat, Orkney Islands)

We move to the open debate.

Edward Mountain (Conservative, Highlands and Islands)

Yet again, we are discussing the inability of this incompetent Scottish Government to keep our islands connected. Four years ago, we needed to build one ferry every year to keep our fleet fit for purpose. Now, according to CalMac, because of the Government’s failings, we need to build two and a half ferries every year for the next 10 years to get back on track. That is a sad indictment.

Seven years ago, a contract was awarded to build two ferries; today, it appears that neither of them is close to completion. It took seven years to build an aircraft carrier and yet this Government has nothing to show for the hundreds of millions of pounds that we have spent—what a farce.

What went wrong? Things started to go wrong even before the contract was awarded. If we cast our minds back to 2014, the year of the divisive but definitive referendum, in August of that year, the Ferguson’s yard went into receivership, which was not good news for Scotland or the case for independence. Resolving the issue became a priority for the Government and for Alex Salmond. How fortuitous it was that, within a month—and before the referendum—a key SNP financial supporter and its economic adviser stepped up and purchased the yard. That was a coincidence, surely, and was not, as some have suggested, on the back of a promise that the yard would be awarded Government ferry contracts—perish that thought.

However, barely a year later, Ferguson Marine Engineering Ltd—the new name of the yard—had indeed been awarded the contract. Let me list some of the attributes of the yard that were identified at the time of its tender. It had a highly skilled workforce, no doubt, but they had no management experience of shipbuilding, and none of the managers had been near a boat. It was the most expensive tender and had the most unrealistic delivery time. The company could not provide any evidence of financial security, and did not even have the support of the purchaser, CMAL. Bearing that in mind, why would it not be given the contract?

Next, we need to look at how the Scottish Government managed the contract. As Willie Rennie said, numerous SNP ministers played pass the parcel with this hot potato and they all had their fingers burned. There was Nicola Sturgeon, who had a hotline to Monaco and the owner and launched hull 801 in 2017 with wooden windows and funnels connected to engines that were not actually there. There was Humza Yousaf, the transport minister who could not even explain why there was a delay to the ferries when we passed the construction date. There was Derek Mackay, who signed off the payment of £127 million for a £97 million contract to Ferguson Marine, only to end up with two rusting hulls.

There was Michael Matheson, as cabinet secretary for transport, who assured everyone almost up until he left the appointment that everything was going right and that nothing was wrong. There was Kate Forbes—I am glad that she is back in the chamber—who oversaw the yard palming off control to a turnaround director, who achieved no turnaround of the yard’s fortunes. There was Fiona Hyslop, who claimed that the shipyard had a bright future ahead of it but had no knowledge of the depth of the problem, and there was Graeme Dey, who knew of the problems and who was content for a shipyard in Turkey to build the next hull.

Now it falls to Jenny Gilruth, who, after five weeks of being asked when the ferries would be delivered, was unable to confirm the date, leaving it to Kate Forbes to do so today. That is a pretty disappointing roll of honour; frankly, it is a roll of shame and each and every one of them should hang their heads in shame and embarrassment.

Who was that turnaround director who was appointed by the finance secretary? He was appointed after a single telephone interview and he of course came with the relevant shipbuilding experience, having been a cruise ship engineer 30 years ago. The previous company that he turned around went into liquidation shortly after he left it.

Business experience tells me that, for the first six months of a turnaround director’s appointment, they are part of the problem; after that, they become the problem. For nearly two years, the yard struggled on, rearranging the stores and rearranging the yard layout. Some people have said to me that it was about as useful as reorganising the chairs on the Titanic after it had hit the iceberg.

Finally, I want to mention costs. Apparently, this was a fixed-price contract, with 15 staged payments for each ferry. Someone therefore needs to explain to me and to the islanders how the Government allowed the payment of 82 per cent of the contract value before the ferries were even completed. That was how much the Government had paid when the yard went into receivership, but it does not stop there. Without CMAL’s knowledge, the Government lent FMEL £45 million—the Government did not tell CMAL that it had lent that money, when CMAL was still signing off payments before they went to the Government.

Today and at every opportunity, the Government has swept under the carpet the costs of the additional harbour infrastructure that is necessary to allow the new ferries to run. We have not even considered how much has been spent in each harbour to allow the ferries to come in, or the cost of the liquefied natural gas tanks. That is interesting, because we commissioned the ferries even though we do not have any LNG, so it will have to be delivered to the ferries in lorries that travel from Kent to allow them to run. I am sure that those are really good green policies.

When it comes down to it, we have heard today—unless I have got it wrong—that there is about another £140 million to be spent on the ferries, and we have already spent £140 million. My belief is that we will probably have spent £100 million on infrastructure by the time that we have completed it all. I think that we will have little change from £0.5 billion. If we open the books, we will find out the true costs at all stages.

I know that the Auditor General has been quoted, but I will quote him again. He said:

“The failure to deliver these two ferries, on time and on budget, exposes a multitude of failings. A lack of transparent decision-making, a lack of project oversight and no clear understanding of what significant sums of public money have achieved. And, crucially, communities still don’t have the lifeline ferries they were promised years ago.”

The situation is a complete mess and a complete demonstration of catastrophic mismanagement, as the REC Committee pointed out in 2021. What we really need is a public inquiry.

Jackie Dunbar (Scottish National Party, Aberdeen Donside)

I welcome the opportunity to speak in this debate on Scotland’s ferries. Although I was not an MSP at the time, I am acutely aware of the extensive inquiry that the Rural Economy and Connectivity Committee undertook on ferries in session 5. I am sure that we are all in agreement that it is incredibly crucial to our island communities and island economies that we have good transport links between our remote communities and the mainland. Those transport links act as an essential lifeline for residents, including for the supply of food and services.

Over the past few years, Scotland’s ferries have been operating in very tough conditions. Ferries have faced the challenges of the Covid-19 restrictions, combined with increasingly adverse weather events. Vessels also need to be taken out of circulation for essential day-to-day maintenance, which folk in the chamber seem to forget about at times. Those challenges have caused cancellations and disruptions on the ferry network.

In response to those challenges, the SNP Scottish Government has invested more than £1.9 billion in our ferry services, vessels and infrastructure since taking office in 2007. Those investments have included money for new routes, new vessels and upgraded harbour infrastructure, as well as the roll-out of significantly reduced fares through the road equivalent tariff scheme.

Neil Bibby (Labour, West Scotland)

The member mentioned the level of investment that the Government has made in ferries since 2007, but the Government has built only six ferries in 15 years. That is not nearly good enough, particularly when that is compared with the record of the last Labour-Liberal Democrat Administration, which built 10 ferries in eight years. Clearly, the rhetoric is not matching the reality of what people in Scotland need.

The Deputy Presiding Officer

I will give Ms Dunbar the time back.

Jackie Dunbar (Scottish National Party, Aberdeen Donside)

I hear what Mr Bibby is saying, but we have put the budget in place, and sometimes what is in place is more important than what is delivered—that does not really make much sense, Presiding Officer. What I was meaning was that, sometimes, it is good to have the budget in place and the responsibility within the Scottish Government.

As Mr Bibby said, since 2007, eight new vessels have been introduced to the CalMac fleet, including a further two that are under construction. That highlights the SNP Scottish Government’s commitment to crucial infrastructure for our island communities.

Our Scottish Government has delivered significant ferry fare reductions on the Clyde and Hebrides routes, which has led to a welcome boost in carryings, which supports our island and remote communities and their local economies. That was emphasised by the Scottish Government budget, which continues to provide support for subsidised ferry services across the islands, with £19.2 million for local authority ferries—an increase of £7.7 million on the previous year. That demonstrates the commitment that the Scottish Government has made to our islands.

Katy (Labour, West Scotland)

Is the member aware that, in the 14 years up to 2007, 26 ferries were brought into service? Does she accept that the 14 years since 2007 compare poorly with that, and that the long-term failure to invest since 2007 is the real reason why we are having this debate today?

Jackie Dunbar (Scottish National Party, Aberdeen Donside)

I am aware of the 46 per cent capital cut that Labour and the Liberal Democrats made in the time that they were in Government.

Given the investments and actions that I have laid out, it is simply puzzling that we continually hear from across the chamber calls for more funding for everything, including transport infrastructure, healthcare, justice and education. The list never ends, but I am still waiting to see what any of the Opposition parties’ budgets would have been. I have seen neither sight nor sound of where they would cut funding in order to fund their endless calls for money. It is very easy to make those demands when they do not have to balance the books every year. If the Opposition parties joined our calls for full fiscal autonomy for this Parliament, they would at least have a basis for their uncosted financial demands. Coming from a local authority setting, where most Opposition parties provide an alternative budget, I was amazed that none came forward in this chamber.

The Scottish Government is committed to undertaking the first comprehensive review of the ferry network. The islands connectivity plan will replace the current ferries plan and look at aviation, ferries and fixed links, to ensure that all potential options for connecting our island communities are considered. As part of that plan, it is key that the Scottish Government consults the users of the ferries and learns from the experiences of other countries and other modes of transport, and I ask the minister for an assurance on that.

I welcome the fact that the Scottish Government will produce and maintain a long-term plan and investment programme for new ferries and development of ports, in order to improve resilience, reliability, capacity and accessibility, increase standardisation and reduce emissions to meet the needs of island communities.

In 2005, when the Ferguson’s yard faced closure because of the inaction of the previous Labour Government, the SNP joined Labour rebels to demand that the yard be saved. In 2014, when the yard faced closure once more, the SNP Scottish Government stepped up and helped to save it, rescuing more than 300 jobs. Today, there are almost 500 permanent and temporary staff at Ferguson’s. Let us contrast that against the recent developments with P&O Ferries, a multimillion-pound corporation that benefited from taxpayer Covid-19 funding and has just made 800 staff redundant with absolutely no notice.

Stephen Kerr (Conservative, Central Scotland)

Will the member take an intervention?

Jackie Dunbar (Scottish National Party, Aberdeen Donside)

Normally, I would take an intervention, Mr Kerr, but I have absolutely no time.

The Deputy Presiding Officer

Yes, you need to wind up now.

Jackie Dunbar (Scottish National Party, Aberdeen Donside)

The services that are provided by P&O, including the vital links between Scotland, Northern Ireland and Europe through the port of Cairnryan, are essential for Scotland’s economy. The Tory UK Government has consistently blocked changes to employment legislation that would have prevented the abhorrent treatment of workers at P&O Ferries, and it still shows no signs of doing anything to close down the possibilities of future companies doing the same.

The Deputy Presiding Officer

Ms Dunbar, you need to conclude.

Jackie Dunbar (Scottish National Party, Aberdeen Donside)

Will Labour join me today in supporting the Scottish Government, which shows clear support for P&O Ferries employees and calls for those fire-and-rehire practices to be outlawed?

Jamie Greene (Conservative, West Scotland)

I am really pleased to take part in today’s debate, and I thank Finlay in my office for stepping up this week in the most difficult of circumstances.

I have been raising the issue of ferries pretty much since I stood for election, in my capacity as a regional MSP, when I held the transport brief and when I was a member of the then Rural Economy and Connectivity Committee. The debate is really for our islanders. It is a chance to give them a much-needed voice in all this, because barely a week goes by without a ferry-related fiasco on our beleaguered ferry network.

MSPs who represent any island community will know at first hand about the constant delays and cancellations that have become a regular and routine part of islanders’ day-to-day lives. Those issues are not all weather related, either. I see those who sit behind the Government benches, sheepishly asking their scripted questions about ferries and pointing the finger at everyone but their own ministers. All the while, they pretend to be angry in the local papers, but they are afraid to come into the chamber and hold their own ministers to account for a change.

Kate Forbes (Scottish National Party, Skye, Lochaber and Badenoch)

Does the member recognise that the ministers to whom he refers also represent island communities that are dependent on those vessels?

Jamie Greene (Conservative, West Scotland)

I absolutely recognise that they represent those communities, and they should be ashamed of the way in which their Government is treating them.

In the past few weeks alone, there have been perfect examples of what the issues mean on the ground for islanders. The 16-year-old MV Loch Shira has been out of action due to numerous sewage system problems. Multiple routes are out of operation because the temporary replacement vessels are unable to handle the strong winds that the scheduled vessel could have handled. It is the constant moving of the pieces of the jigsaw—moving vessels from one route to another and pitting island against island—that is annoying islanders the most.

The biggest kick in the teeth is handing ferry contracts to Turkey. That is the inevitable and sad outcome of the nationalisation of a Clyde shipbuilder. I say to Willie Rennie that “stronger for Turkey” is not just a silly meme; it is, unfortunately, a sad and inevitable truth as a result of this Government.

Stuart McMillan (Scottish National Party, Greenock and Inverclyde)

Will the member take an intervention?

Jamie Greene (Conservative, West Scotland)

I know what Mr McMillan is going to ask me, and I will come on to the nationalisation issue in one second, so listen up.

The story of this Government’s mismanagement goes back—[Interruption.] Please listen, because I am very happy to address the utterly catastrophic nationalisation project that you have embarked on in one second.

The Deputy Presiding Officer

Mr Greene, please speak though the chair.

Jamie Greene (Conservative, West Scotland)

I am happy to do so, Presiding Officer.

The 2007 SNP manifesto promised

“a fairer deal for ... Islands”.

That was an admirable promise to make to the electorate. In 2011, the SNP repeated that promise by saying that it had

“placed the needs and aspirations of ... our island communities at the very centre of the Government’s ... agenda.”

Is that so? Where on earth is this new ferry for Arran, in that case? Which bit of that single failure alone is putting our islands at the heart of the Government’s agenda? Back in 2015, the First Minister herself said that the Scottish Government was

“committed to supporting ferry users around Scotland by providing safe and reliable services.”

She went on to say that the Government would ensure that

“we have a fleet that continues to deliver for the communities that depend on it.”

First Minister, we are still waiting for that fleet.

Two years later, the First Minister made another visit to Ferguson’s. That famously went down in history as the much-heralded launch of the Glen Sannox, a ship with no pipework, no electrics, no engine and those infamous painted-on windows, which have come to symbolise the Government’s approach to our island communities. It is all shiny and appealing on the outside, but it is not fit for purpose when we peer through the painted-on portholes.

All we have heard are countless manifesto promises and countless programmes for government, but not a single head has rolled, no one has been fined, no one has been investigated and no one has really been held to account.

Of course, I welcome today’s apology from the Minister for Transport, but all the while, our islands are suffering on a day-to-day basis. I have raised ferry-related problems no fewer than 85 times in the chamber, including in my maiden speech. One of the first anecdotes that I shared in the chamber was about a gentleman from Arran with a physical disability who could not schedule a hospital appointment on the mainland. That was six years ago. Since then, dozens and dozens of cases have been taken on by my office, by the offices of my colleagues and probably by every member in the chamber. Problems have related to accessing healthcare, education, tourism, businesses and agriculture.

I could spend a whole afternoon sharing stories and anecdotes of people being let down by a litany of ferry delays and cancellations due to technical issues. Graham Simpson spoke about a constituent of mine who missed a breast cancer operation not that long ago. That is not just a shame; it is negligence. That was not the fault of Covid, Jim McColl, Tim Hair or even Robbie Drummond; it was the fault of the whole broken system.

That system involves ferry tenders that are so narrowly specced that they prohibit sensible competition on profitable routes; a ferry operating company that does not own the ferries that it operates and is not given the ferries that it asks for; vessels that do not match the ports that they are supposed to serve; putting cruise-liner services on short-range commuter routes; failing to listen to the needs of communities; complex ownership and operating structures; a lack of oversight; and zero accountability when it comes to millions of pounds of public money. We can sprinkle on top of that a gross and long-standing failure to come up with any shipbuilding or procurement plan that is fit for purpose and delivers value for money.

If we scratch below the surface, we find that everyone knows that CalMac is at creaking point. It knows it, CMAL knows it, Transport Scotland knows it and even the Government knows it.

Let me turn to the point about nationalisation. We hear it so many times that the Government saved the yard. If it saved the yard, let me ask some very specific questions. Did Jim McColl ask or offer to siphon off the CMAL contract into a separate company of which the Government could easily have taken ownership, which would have allowed the yard to prosper, free from the shackles of the plagued LNG project? Was he lying? Was his offer rejected? If so, why? Who else put in a bid for the yard? How many bids were received, and why were they rejected?

Did the Government threaten potential new owners of the yard with the burden of calling in its debt? Who on earth did the risk analysis on the effect that public ownership would have on the yard, on state aid and on the ability to tender for new contracts? Where are those new contracts? Which bit of saving the yard has resulted in Scotland building ships in Turkey?

At least Scotland’s other Government gets on with actually building ships in Scotland. The Scottish Government should be ashamed. I support the motion in Graham Simpson’s name.

Katy (Labour, West Scotland)

I welcome the debate and the tone of the minister’s opening remarks, as she seemed to accept that islanders have been let down.

Islanders on Arran and Cumbrae contact me almost daily about ferry cancellations. They fully appreciate the problems that are caused by weather and by Covid, which is still with us, but they get in touch about issues connected to mechanical and technical failures, which impact on their lives and the lives of everyone in their community. This debate is about the failure to deliver a resilient ferry fleet.

In the time available, I will focus on the long-term failure to invest in new fleet on CalMac routes, the lack of an industrial strategy or procurement framework to ensure that we have the capacity to build new fleet in Scotland, and the wider issues relating to employment rights in the maritime sector, which Jackie Dunbar referred to and which have been highlighted again through the treatment of P&O workers.

Most industry experts agree that the average life expectancy of a ferry is 25 years. Half of the 31 state-owned ferries in Scotland are older than that. The MV Caledonian Isles, on the Ardrossan to Brodick route, was brought into service in 1993; the MV Loch Riddon, on the Largs to Cumbrae route, was brought into service in 1986; and the MV Isle of Arran, which is used on the Ardrossan to Campbeltown and the Ardrossan to Arran routes, was brought into service in 1983. Over the past five years, more than 1,000 ferry sailings have been delayed due to mechanical issues associated with the age of the fleet.

The consistent failure to provide investment since 2007 is one reason why we are in the position that we are in. Earlier, we heard the statement about Ferguson Marine. It is important that we put on record that it is not the workforce’s fault that we are in this position; we are in this position because of mistakes and mismanagement by politicians and management. We need to rebuild the reputation of the yard and ensure that a pipeline of future ferry contracts can be achieved, and we need to learn from the mistakes that have been made up until now.

The Scottish Government has wasted more than half a million pounds in taxpayers’ money for private firm Ernst & Young to provide advice since 2015. We have already heard that senior management have been paid eye-watering sums. We need an emergency ferries plan with a procurement strategy to ensure that our ferries are built in Scotland and that groups such as the Arran Ferry Action Group and islanders in the affected communities are involved in decision making. Frankly, if they had been more involved in the decision making that led to our having this debate, we would not be hearing these kinds of contributions from members on all sides of the chamber.

The trade unions also need to be involved in those discussions—I asked the cabinet secretary yesterday if they could be involved in discussions about P&O ferries. It is vital that the workforce in CalMac, CMAL and Ferguson Marine be involved in those discussions, too.

The Scottish Government needs to accept that mistakes have been made; it needs to stop digging and to accept that, since 2007, investment has not been made at the level that has been required, and therefore that further investment is needed to catch up. We need to start including communities in decision making, which includes having the Scottish Government agree to a public inquiry to ensure that lessons are learnt for the future.

The backdrop is the marine sector, which employment law does not fully cover. Due to the exemption of seafarers from all employment law regulations, workforces that are brought in are paid less than the national minimum wage. That is part of the reason why it is important that ferries are kept in the public sector and that Ferguson Marine, CalMac and other parts of the sector that are owned by the public are successful.

I assure the Scottish Government that it has the support of Scottish Labour in keeping these services in public ownership. However, we genuinely believe that the Government needs to listen to what communities, the workforce and all involved are saying, to learn lessons and to agree to a public inquiry, so that we do not repeat the mistakes that were made in the past.

Paul McLennan (Scottish National Party, East Lothian)

I am grateful for the opportunity to speak in the debate. We can all agree that ferry services provide an essential lifeline to island and remote rural communities and their economies, as we have heard. I am aware of how important those services are to the communities that they serve and of what they mean to the economy and general wellbeing of such communities.

The changing climate and the many storms that we have had this year, alongside Covid-19, have caused many cancellations in ferry services, and I appreciate the apologies from the Minister for Transport.

Before we go further in our discussions, I want to touch on the Audit Scotland report. Like any report, it looks back but also makes recommendations on ways ahead. I want to touch on a point that both the Cabinet Secretary for Finance and the Economy and the Minister for Transport have made. The report says that Audit Scotland’s

“recommendations are intended to support the completion of vessels 801 and 802”

—that has been picked up;

“improve future procurement, contract management and delivery of new vessels”

—that has been picked up;

“help inform thinking about the future of FMPG”

—that has been picked up; and

“increase the transparency of the Scottish Government’s decisions and expected outcomes in relation to supporting private business.”

Today’s debate is about looking back but also about learning lessons.

Stephen Kerr (Conservative, Central Scotland)

Will the member take an intervention on that point?

Paul McLennan (Scottish National Party, East Lothian)

Yes, if I can get the time back, Presiding Officer.

The Deputy Presiding Officer

Yes.

Stephen Kerr (Conservative, Central Scotland)

Paul McLennan lists the report’s recommendations. Does he also acknowledge that Audit Scotland’s report states that significant and unsolved problems relating to the projects remain? Does he accept that?

Paul McLennan (Scottish National Party, East Lothian)

Yes. As I said, the report is both looking back and looking forward. The cabinet secretary and the minister have already picked up those points.

We have to acknowledge that technical issues have caused further problems, adding to people’s frustrations and inconvenience.

It is also worth acknowledging, as a balance, that more than £2 billion has been invested in service contracts, new vessels, and infrastructure since 2007 and that, in the current five-year period, a further £580 million has been committed. Jackie Dunbar made the good point that we had no alternative funding proposals from Opposition parties—none.

The £580 million will enable harbour investments, two new vessels for Islay to be built and the purchase of the MV Loch Frisa, as we heard earlier.

Liam Kerr (Conservative, North East Scotland)

Will the member take an intervention?

Paul McLennan (Scottish National Party, East Lothian)

I am trying to balance the time.

The Deputy Presiding Officer

I can give you a little bit of time back.

Paul McLennan (Scottish National Party, East Lothian)

Okay.

Liam Kerr (Conservative, North East Scotland)

Does the member think that it serves the Oban to Mull route well to replace the current vessel with a second-hand vessel that is slower and has one third of the capacity?

Paul McLennan (Scottish National Party, East Lothian)

That is a decision for the people who have the expertise in that sector. I do not pretend to have that expertise, but I am more than happy to take the question up.

The Scottish Government’s commitment to publish the islands connectivity plan by the end of 2022 is also welcome and I have no doubt that it will be discussed in the chamber and in committee, as it needs to be. As we know, the islands connectivity plan will replace the current ferries plan, and it will look at aviation, ferries, fixed links, and investment in more sustainable ferries, and it will ensure that 30 per cent of state-owned ferries are low emission by 2032.

The islands connectivity plan will be implemented through the national transport strategy and the strategic transport projects review. That will enable us to consider other potential viable options for connecting the islands.

The islands connectivity plan will replace the ferries plan by the end of 2022, and engagement and consultation on it will enable substantial public and community input. We heard that important point from Katy Clark; there needs to be input from the communities, which must be extensive and allow for two-way conversations. Perhaps the minister or cabinet secretary can comment on that in summing up this afternoon. It is incredibly important.

We need to invest in more sustainable ferries and reduce their carbon footprint. We are committed to 30 per cent of state-owned ferries being low emission by 2032.

The Scottish Government plans to explore the potential to build more fixed links to island and remote communities, such as a bridge from Gourock to Dunoon, and work with island communities to reduce their reliance on ferries. Again, that needs to be part of the consultation process

Investment in our ferry fleet can come with benefits for our industry. The Scottish Government’s intervention in 2019 saved the Ferguson’s yard and its workforce from an uncertain future, and we cannot underestimate that. Progress has been made at the yard, but we need to ensure that Ferguson Marine is back to being a serious contender for future vessel contracts.

Paul Sweeney (Labour, Glasgow)

Will the member take an intervention?

The Deputy Presiding Officer

I will not be able to give you any more time back, Mr McLennan.

Paul McLennan (Scottish National Party, East Lothian)

I am sorry, Mr Sweeney. I have taken a few interventions already.

However, we must ensure delivery as best we can when it comes to lifeline services for our island communities. Ferguson Marine continues to evolve, and the appointment of the new chief executive officer earlier this year has been touched on. The Scottish Government remains fully committed to supporting the Ferguson’s yard to secure a sustainable future, including a pipeline of future work.

Of course, it was disappointing that Ferguson Marine did not progress to the invitation-to-tender stage of the Islay vessel last year. The Scottish Government continues to work closely with the yard to ensure that it becomes globally competitive, and we should remember that Ferguson’s yard is still operating and employing hundreds of skilled workers.

The decision taken to safeguard the future of Ferguson Marine was the right one. Not only did our efforts save the last commercial shipyard on the Clyde from closure; they directly saved more than 300 jobs.

Graham Simpson (Conservative, Central Scotland)

Will the member take an intervention?

Paul McLennan (Scottish National Party, East Lothian)

I do not have time, as the Presiding Officer has said.

The Scottish Government has set out two priorities for the yard’s management: to finish building the two ferries that are under construction; and to get the yard back into shape to compete for new work. Scottish Government ministers will do all that they can to ensure a strong future for Ferguson’s.

A review of whether the legal structures and governance arrangements that exist between the tripartite group of Transport Scotland, CMAL and CalMac remain fit to deliver an effective, efficient, and economic ferry service has just started and will deliver a final report later in the year.

The Scottish Government is also developing a revised ferries stakeholder engagement strategy. I hope that the cabinet secretary or minister can talk about that in summing up. The strategy will set out an approach to engagement on the three key areas of operational issues, strategy and policy.

The infrastructure investment plan for Scotland for 2021-22 to 2025-26 will produce and maintain a long-term investment programme for new ferries and development at ports to improve resilience, reliability, capacity, and accessibility, and reduce emissions to meet the needs of island communities.

It has been a tough few years for some of our island communities because of adverse weather, Covid, and of course technical issues and delayed orders. Lessons need to be learned. Our island communities need to be reassured and fully consulted, and we need a thriving shipbuilding industry in Scotland.

Ariane Burgess (Green, Highlands and Islands)

As we have heard from members across the chamber, ferries are vital arteries for our island communities. A cancelled ferry is a first baby scan missed, or a shop or pharmacy unstocked. The accumulation of such disruptions reach a tipping point at which island life is sadly no longer viable.

There is no doubt that this has been a challenging winter for island residents, businesses and communities. As a Highlands and Islands MSP, I feel viscerally the impact that ferry disruption has on my constituents. It is vital to put them at the centre of the debate.

Earlier this month, three families with young children left South Uist in just one week, after the latest in a long string of incidents that had led to cancellations of the Lochboisdale ferry. Only 24 per cent of respondents to the national islands plan survey feel that young people are sufficiently supported and encouraged to remain on or move or return to islands. We can change that by improving transport links and connectivity.

Lifeline ferry services are essential to community life, so it is only responsible that their governance should include members of the communities that they serve. A positive step would be for the Scottish Government to implement mandatory islander representatives on the boards that provide oversight of Scotland’s ferries.

It should not be lost in this debate that the ferries are not separate from our communities; they are our communities. Water-based passenger transport provides around 1,100 jobs, mainly in island and coastal areas. I join the Scottish Government in recognising the work that vessel masters do in ensuring the safety of crews and passengers.

The Scottish Green Party strongly supports ferry workers’ rights and joins the Scottish Government in condemning the despicable employment practices that were recently deployed by P&O Ferries. It is imperative that the UK Government take swift action to close the legal loopholes that made that possible.

Covid-19 could not have been predicted, but the resulting absences and disruption should now be factored into business planning. That may require extra resources, and we would support the Scottish Government to take action to increase resilience in staffing.

Similarly, the climate emergency has meant that extreme weather events are becoming the new normal. The recent spate of severe storms has shown just how disruptive that can be to transport, as well as to internet and electricity connections. We need to take action now to make plans to adapt to those changes so that islanders are not left on the sharp end of them.

How can we move forward? I echo the calls from my constituents and local councillors for the current fleet to be expanded, which would build in redundancy over the winter and add capacity in the summer. I welcome the minister’s comment that such work is under way.

Graham Simpson (Conservative, Central Scotland)

Does Ariane Burgess agree, therefore, that we need to increase the budget for ferry replacement, so that we can get more ferries?

Ariane Burgess (Green, Highlands and Islands)

Rapid change needs to be made, but we must get it right, which means taking the time to properly define the requirements and identify the benefits, as well as increasing investment.

Although I welcome the investment that has been made in service contracts, new vessels and infrastructure, and the further £580 million that has been committed over the next five years, I urge that new vessels be zero or low carbon. Electric ferries are already running on renewable energy in Sweden and Denmark, and Europe’s first green hydrogen ferry is currently being designed here in Scotland. We may also need to increase the use of diesel-electric hybrid ferries until we can phase out diesel completely.

Jamie Halcro Johnston (Conservative, Highlands and Islands)

Given that the number of low-emission ferries has gone backwards in the past few years, because of the purchase of the northern islands boats and the fact that there are so many issues with regard to the replacement ferries, does Ariane Burgess support our call for a public inquiry into the Government’s mismanagement of our ferry network?