THE disastrous CalMac ferries contract which could ultimately cost taxpayers £250 million was awarded to Ferguson Marine despite the yard not having space to build both vessels side by side, a public inquiry has been told.

MSPs also heard how 'constant' design changes led to a 'stand-off at the OK Corral' between bosses at the Port Glasgow yard and officials at the Scottish Government's ferries and ports operator, Caledonian Maritime Assets Ltd [CMAL].

Ferguson's GMB union convener Alex Logan told the probe that it became a matter of 'who was going to cave in first' and that relations between the two sides became so bad they couldn't sit in the same room together.

Holyrood's rural economy and connectivity committee probe into the fiasco heard evidence that when workers expressed concern about the lack of space to build the ships they were criticised for being 'negative'.

The inquiry was also told that the ferries were 'significantly less than half built' and that 95 per cent of the design had yet to be agreed five years after the deal was signed to build them.

The ferries, Glen Sannox and the as yet unnamed 'hull 802, are currently at double their original budget and four years behind their scheduled completion dates.

Ferguson's — the last commercial shipyard on the Clyde — was rescued by billionaire businessman Jim McColl nearly six years ago and it went on to land a £97 million contract to build two dual-fuel vessels for CMAL.

Relations between the two sides broke down amid bitter disagreements over design changes and Ferguson's went into administration after CMAL refused to pay extra for them.

The Scottish Government has since nationalised the yard to safeguard 350 jobs and ensure the completion of the ferries, with finance secretary Derek Mackay blaming the 'disastrous' previous management for the failure.

It has been calculated that it would cost further £110m above the £83m already paid to Ferguson's in order to finish the ferries.

The government has already written off £50m in loans to the yard.

Industrial tycoon Mr McColl has refuted the criticism and blamed CMAL for the problems.

GMB convener Mr Logan said the yard, which is constrained by Newark Castle on one side, was never big enough to build the ships side by side,

He said: "You've got a concrete slip yard. It can take one big vessel and possibly a small vessel.

"But in my opinion, we could not facilitate to build two vessels that size so close together because the ground wasn't sufficient enough."

He said there was a plan, which he called 'fine in concept', to build one hull on the slipway then launch it to make way for the completion of a second partly built hull, but it didn't work.

Mr Logan said: "We started the 802 hull and it was moved to the side towards the castle side, and it was all kind of soft ground.

"If you started putting hundreds of tons of units on that then it's going to sink."

He added: "It's plain to see — the size of the vessels that they were building, and the breadth of them on the berth, that the two vessels weren't going to [fit].

"We needed a mobile crane to go down in between them, and the space as you started building the two together, there wasn't enough space."

Asked if the workforce had warned managers about the looming problem, Mr Logan said: "The management team said they didn't like our negativity."

Mr Logan said design changes had been made 'constantly' and there was still not a finalised design for the vessels, meaning working on them was 'like building a jigsaw when you've got missing parts — you're never going to complete it."

Of Ferguson's and CMAL managers, he said: "They wouldn't agree on the design so we couldn't move forward, so it just came to a standstill.

"It was just a stand-off at the OK Corral.

"Who was going to cave in first?"

Mr Logan added: "It came to a situation that CMAL and our own management team couldn't sit in the same building.

"That started affecting the workforce, because the work stopped on the vessels."

Lib Dem MSP Mike Rumbles said: "The Scottish Government need to come clean on what due diligence was done before a contract worth tens of millions was dished out."