Chamber and committees

Indeed.

Mr Beattie, which paragraph is that? I have the Audit Scotland report here.

I think that that refers more to the second loan than to the first loan.

We were certainly aware that the relationship was becoming progressively more strained and difficult. Ministers—principally the portfolio ministers of the time—would have been involved periodically in discussions and updates.

That said, a lot of effort was made—on both sides, I think, and I know particularly by CMAL—to keep the relationship where it needed to be for us to see progress on the vessels. If you go through CMAL’s various updates to the programme steering group, for example, and the updates that came through the expert that the Scottish Government commissioned, you will see that they contain many references to there being improvements at times, things working better and there being more confidence. Overall, however, and broadly speaking, that relationship was in a downward spiral.

It is not hard to understand the frustration that CMAL felt at having signed a contract of that nature, with responsibility for design and build passing to the shipbuilder, as is standard practice, yet all those issues were being raised that had not been raised at the time. I understand its frustration. Similarly, Jim McColl and FMEL clearly had concerns, which they voiced.

Ministers were aware of that and—again, I think that this is all reflected in the documents that have been published—there was definitely a view on the part of the Government that we wanted to encourage mediation. There was a period in which mediation was agreed to by both parties, but it did not happen. The chosen mediator was not available in the timescales that were necessary.

The contract allowed for mediation, expert determination and then court proceedings as the dispute resolution steps. CMAL’s view, I think rightly, was that expert determination was not appropriate here. Apart from anything else, that was because of the scale of the claim that FMEL was making outside the contract, which ultimately became £66 million. The right way to resolve it was therefore for FMEL to go through the court process, which—as was its right—it never chose to do.

Ministers were seeking to keep the relationship where it needed to be, to improve it and, where we could, to use our best offices to resolve the issues between the parties. In the published documents, you will see evidence of the Government seeking to do that all along in relation to the contract issues between FMEL and CMAL.

Beyond that, as is evidenced in the loan agreements, the consideration of the proposal that Jim McColl put prior to public ownership and then at public ownership—at all stages—we were also seeking to discharge the wider responsibilities of trying to keep the yard open and operational and protecting employment, as well as getting the vessels finished.

I think that we are talking about a meeting on 4 June, which was part of the ordinary process of obtaining technical clarifications from bidders. As I understand it, CMAL took proper in-house procurement advice on that and there was nothing inappropriate in having such a meeting. That is CMAL’s response to that point.

However, it is right that that aspect should be subjected to proper scrutiny by the Auditor General. Although you are absolutely right to say that that is entirely for him, it is important that it is not just my word that is taken on that and that the matter is properly scrutinised, as should be the case for all aspects of the BBC documentary.

For a public announcement that would be a media event, a communications special adviser’s proposal would come to me. Again, I am telling you things that most people already know. As every Government does—and I am pretty sure that it is exactly the same process with Prime Ministerial announcements—we look ahead to things that are coming up over the next few weeks, and the communications teams, with special adviser input, will decide whether an announcement that is coming up might be one for the First Minister to make.

I do not recall whether that was the case with this particular announcement, but I often look ahead at suggestions of media announcements that I will make for the next two or three weeks, for example.

What point are you asking me about in terms of my involvement? I want to be clear about that so that I answer your question specifically.

Was there an interest? You have used a rather pejorative term, which, for the avoidance of doubt and for the record, I completely and utterly refute.

Is there an interest on the part of any Government? I am talking in general terms and will come to the specifics in a second. I imagine that what I am about to say is shared by every politician round this table. Ministers and politicians in general are often challenged on these points by opposition politicians. Assuming that it is all done by the book, you are quite happy to see contracts go to Scottish companies and therefore to support Scottish jobs. I am pretty sure that every politician round this table would say that that is ideally what we want to see, providing that it is all done appropriately.

From your later comments, that is obviously not what you mean by “interest”. If you are asking whether there was anything untoward in the procurement process in order to somehow inappropriately steer the contract towards FMEL, there absolutely, categorically was not.

In fact, you do not have to take just my word for that. Kevin Hobbs, the now chief executive of CMAL, not in evidence to this committee but in evidence to the previous Rural Economy and Connectivity Committee inquiry—I think that this is the term that was used in that committee’s report—categorically denied that any pressure had been put on CMAL by the Scottish Government around the award of the contract. The contract was awarded purely on the assessment that CMAL did of the tender that FMEL had submitted.

So, the answer to your question, in the way that I think your question is intended, is absolutely, categorically no.

All special advisers in the Scottish Government are designated as advisers to the First Minister but they report to individual ministers and individual portfolio areas. Every special adviser is described as an adviser to the First Minister, but that does not mean that every submission that is copied to an adviser to the First Minister comes to me. In all the submissions that have been published by the Scottish Government, you can see very clearly which ones have been copied to me and which ones have not, and the 8 October submission was not copied to me.

Let me just say that, in order to answer the questions as fully as possible, at times I will say that I was not party to a decision or that I was involved in or notified of another decision. None of that is me trying to step away from my responsibility as First Minister. I think that it should be pretty obvious to everybody that I could never personally take every decision that the Scottish Government reaches, but that does not change the fact that, as First Minister, I am ultimately accountable for every decision that the Scottish Government takes.

That was some time later—an awful lot happened between that meeting and the yard going into administration. I am very happy to go into that with you in detail.