Seòmar agus comataidhean

Okay. Martin—would you like to comment? Bear in mind that nobody likes to pay taxes—this is a question of how we collect the taxes—and that Governments everywhere are under pressure on their revenues.

Can I ask Maxine Smedley how non-domestic rates should be reformed? If that is the correct route to go down, how would you see it happening? There are obviously difficulties in having an turnover tax in relation to retail. Equally, a lot of people would argue that a property-based tax of some form is still the fairest. Maxine, how do you see it going?

Paul, do you want to quickly comment on that?

Is that across the UK or just in Scotland?

In effect, your report has not addressed the impact of contractor failure—I do not see that in your report. The Rural Economy and Connectivity Committee certainly raised the flag, so I would have thought that it would have been a priority to look at that issue. It is our public money that has been paid out to the company and, according to the evidence that has been given to this committee, it has not been paid out in the manner that it should have been. It has been paid out by CMAL, on the advice of its lawyers, according to the contract.

Some very strong statements are made in the report, most particularly in paragraph 160, which says that

“there is strong evidence that the contractor deliberately proceeded to construct specific sections of the vessel either out of sequence or not according to the proper specification purely as a means of triggering milestone payments on the contract.”

Evidence is given in paragraph 157 that work was carried out

“either incorrectly or out of sequence purely in order to trigger payments against the contract”.

Interestingly, too, paragraph 158 cites evidence that

“invoices presented were rejected on the basis they related to other projects”.

Given the committee’s evidence, it seems clear that it had great concerns about the contractor.

Paragraph 153 also highlights evidence that CMAL’s lawyers “advised” that it

“had to make the payments”—[Official Report, Rural Economy and Connectivity Committee, 11 March 2020; c 50.]

that were called for, because that was in the contract and it did not want to break the contract. Moreover, on subcontractors, paragraph 154 cites the statement that

“Ferguson’s deliberately slowed down some of that subcontracting.”—[Official Report, Rural Economy and Connectivity Committee, 5 February 2020; c 11.]

Maybe I have missed something, but I do not see anything in your report that addresses that issue directly. After all, this is very serious indeed. If the Rural Economy and Connectivity Committee’s conclusion is correct, the question, then, is: what action needs to be taken?

My simple question to you is: where did all the money that was paid in go? What was it spent on? It was not in the yard when the yard was nationalised.

There just seems to be such a big and fundamental gap in the overall picture. I am relying on the good work of the Rural Economy and Connectivity Committee, but I do not see where its work on the issue has been built on in Audit Scotland’s report in order to bring out that critical part of the picture. We can all argue about the contract—a huge amount of documentation has been online for some time in connection to that—but how will we address the issue of the failure of the contractor? That question mark is still sitting there.

In response to the Rural Economy and Connectivity Committee’s report, the Minister for Energy, Connectivity and the Islands highlighted that he felt that even that report did not reflect in full the

“contribution of the contractor’s non-performance, contract management and financial management, described in independent evidence”.

Why are we being so precious about this? If there is evidence that points to non-performance by the contractor that has contributed to charges on the public purse, and that applications for funding have not been made in the correct way, that should all be brought out and highlighted.

Okay. I have lots more questions, but I am happy to—

There is something I wish to point out before Nicola Dickie comes in. The Auditor General’s briefing is dated January 2022. I applaud the optimism in everything that the witnesses are expressing about collaborative work, but that is not being evidenced in what is coming before the committee. It will obviously take time before that work feeds through but, based on the evidence that the committee has seen, it is substandard, to be honest.