EDITORIAL | Dead hand of government destroys yet another shipbuilder

While I love Scotland and the Scots – with a name like mine, how could I not? – I’m still incredibly glad that my Ayrshire ancestors made the brilliant decision to emigrate to Australia 175 years or so ago.

My attitude was reinforced the other day by the decision of the Scottish Government to nationalise the Clydeside’s second last remaining shipbuilder, Ferguson Marine, which had been bankrupted by a combination of its own incompetence and Scottish Government dithering. Ferguson is yet another shipbuilding victim of the “variations” arising from government negligence.

I cannot imagine why any shipbuilder in his right mind, unless he is very carefully structured to do so, would want to bid for government contracts anywhere. All the shipbuilders I know who have done so, have soon regretted their decision.

As so often happens, everything looked rosy when the contract for two 100-metre conventional monohull Ro-Pax ferries for Scottish Government owned operator CalMac was signed. Smiles all round and lots of positive government propaganda claiming it was saving jobs on Clydeside.

Of course, this flew bravely in the face of reality. Shipbuilding on the Clyde, despite its glorious history has been uncompetitive for decades. It is long dead and should have been decently buried many years ago ago. Instead, the Scottish “Nationalists”, which should read “socialists”, decided to make themselves temporarily popular by subsidising the construction of two inappropriate ferries for local operation.

As should have been well known and obvious to the Scottish bureaucracy and parliament, better, safer, more efficient ships could have been purchased for little over half as much as the originally contracted price by the simple expedient of obtaining quotes from overseas. A couple of hundred miles from Edinburgh lies the Dutch town of Gorinchem. The main industry in that town is shipbuilding, exemplified by the world leading Damen Shipyards Group. Damen could easily and economically have produced a fine modern ferry for CalMac. Further afield, in Australia and South-East Asia, those well-known purveyors of excellent Ro-Pax ferries to Europe, Austal and Incat, could have done likewise.

Now, with the bankruptcy of Ferguson, that the Scottish Government made almost inevitable, the Clyde will left with only one significant shipyard, the totally government-dependent, BAE Systems, a defence specialist. CalMac will inevitably receive its ferries but they will be at least two years late, at least double their agreed cost and probably four times as expensive as comparable foreign built vessels.

Shakespeare famously told us that, “When first we practice to deceive, oh what a tangled web we weave”. Governments and shipbuilders should learn to substitute the word “subsidise” for deceive. Subsidies never work in the long run. This case starkly proves that reality yet again. A probably more-incompetent-than-corrupt socialist government will, in the long run, have paid some four times what it needed to for its two new ferries. Ferguson will close down and the promised “saved” jobs will inevitably evaporate. Scottish taxpayers will and should be furious.

Shipbuilders everywhere should learn, yet again, from this example that dealing with governments is always fraught with danger. Bureaucratic demanded “variations” are shipbuilder killers. This example has reinforced to me the common sense of my ancestors. While our Australian governments can do many foolish things they are nowhere near as stupid as the current Scottish Government appears to be.