Lessons must be learned from BiFab failure say politicians after critical report
The move comes after Holyrood’s economy, energy and fair work committee expressed concern over the “lack of transparency” on the part of the Scottish Government and company bosses about their investment decisions for the business.
BiFab, which makes structures for the oil and gas and renewable energy industries, went into administration in December after failing to win contracts to build wind turbine jackets for developments off the coast of Angus and Fife, following which the Scottish Government announced it could not provide further financial support – citing EU state aid rules.
In a report, the committee said it was “extremely concerned” by the lack of transparency in decision-making by both the yard owners DF Barnes and the Scottish Government, which had invested almost £40 million of public money in BiFab since 2017 before converting that into an equity stake in the company, as well as providing a separate loan facility of £15 million.
Committee convener, Gordon Lindhurst MSP said: “The committee is extremely concerned by the lack of transparency on the part of both DF Barnes and the Scottish Government over their decision making and use of public funds. Both cited the pre-acquisition business plan as corroboration of their position, but despite repeated requests neither shared this business plan with the inquiry.
“The financial loss of BiFab failing as a company demonstrates the need for greater accountability.”
The committee also expressed its disappointment that neither SSE Renewables or EDF Renewables had awarded recent contracts to BiFab.
David Torrance SNP MSP for Kirkcaldy welcomed the report.
He said: “I am happy with the areas it plans to focus on - the UK government’s Contract for Difference (CFD), the lack of support by the UK government for Scotland’s offshore wind sector supply chain has played and how changes to the leasing and planning process can encourage developers to work more closely with the Scottish supply chain.
“What’s important to remember is that if the Scottish Government had not stepped in with financial support, hundreds of jobs would have been lost and a contract would have been left unfinished in the Methil yard.
“We must also recognise the importance of the lessons that can be learned and I look forward to the committee’s recommendations.”
Councillor Altany Craik, Fife Council’s economy convener, said: “This highlights the need to change the systems to deliver future contracts for work in the renewables sector.
"No one comes out of this without a lesson to learn. It is disappointing we will have turbines made elsewhere and shipped around the world, that we will see daily and rue the fact we could not support our firms to help manufacture them.”
Kirkcaldy MP Neale Hanvey added: “I had positive discussions with the Scottish Government last week about the future of the BiFab yards, this week I met with RenewableUK, and I’ve also been having private conversations with potential investors.
“There’s no denying that this is really difficult time for the yards, but I remain confident things will get better. The political will is undoubtedly there and discussions are ongoing across industry and government.”