FERGUSON Marine’s chairman has claimed that the future of the yard would be put at risk without the controversial bonus payments being made to senior staff.

Andrew Miller told a Holyrood committee the £87,000 paid out to six senior staff in 2021/22 were ‘retention payments’ and stressed the yard had to remain competitive.

The chairman, alongside Ferguson Marine chief executive David Tydeman and senior civil servants, fielded a variety of questions about the delays and costs increases to the yard’s delivery of two new CalMac ferries at a meeting of the Scottish Government’s Public Audit Committee on Thursday.

The two belated boats, the Glen Sannox and the unnamed Hull 802, are due to be completed by the end of 2023 and the end of 2024 respectively.

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The two ferries are still incomplete almost five years on from their original delivery date and build costs have soared from £97m to around £300m.

MSPs questioned Mr Miller about the pay-outs to senior staff, with committee chair Richard Leonard pressing the Ferguson chair on regard for public accountability at Ferguson.

The shipyard chief told the Labour politician that he had ‘due regard’ to the public money that had been invested in the yard.

He said: “We are accountable but at the same time as I’ve said the business has got to remain competitive in the open market.

“Being competitive is having the right people that can deliver in terms of the future growth of the business.”

Mr Miller also defended the payments and said that the yard was operating in a ‘highly competitive market’.

He said: “It’s very important we find the talent for the senior management, it is also very important we retain the talent for the senior management, in terms of completing our journey towards eventual profitability in our five-year plan.

“We’ve got to be competitive, as David [Tydeman] says there’s [£]250 million of available work suitable for the yard and we must make sure we have the right talent in place to achieve that.

“I don’t understand the narrative around the term bonus - these are retention payments.”

Mr Miller added that some of those involved in the payments had employment contracts which had been drawn up by previous administrations.

He added: “It would take individual negotiations between the people who qualify to remove some of these elements.

“But if these elements are removed, without being competitive, the future of Ferguson Marine yard is at risk.”

Willie Coffey, MSP for Kilmarnock and Irvine Valley and committee member, expressed surprised at Mr Miller’s remarks.

He said: “There’s a reasonable expectation that bonuses or incentives would be somehow connected to performance and delivery, rather than to competitiveness and retention of staff.

“We were genuinely surprised to learn, as the government was surprised, that system was not connected to performance and delivery because it’s clearly five years late and well over budget.

“It’s difficult for us to understand and I’m sure the public to understand how that could continue to be maintained.”

Mr Coffey also asked the shipyard boss and Scottish Government officials what the consequences for the yard would have been if Hull 802 was not completed.

Mr Miller responded by saying that abandoning the build would have had a serious impact on the Inverclyde area.

He added: “I would say that 70 per cent of the people in Ferguson Marine live within a ten-mile radius of the yard.

"It would have had devastating consequences to the local community, which has suffered long-term in terms of their competitiveness and also their ability to retain skills which was one of the key elements of the acquisition in the first place: retain the key skills so that Ferguson Marine can be a player in the broader opportunities of the Scottish economy.”