BiFab claims Scottish Government "untruthful" over financial claims

The Scottish Government has been accused of being untruthful and inaccurate over allegations a lack of financial support from BiFab’s Canadian owner is to blame for the company’s problems.

A £2bn deal collapsed last month for Burntisland Fabrications (BiFab) to manufacture eight wind turbine jackets at its yards in Methil, Fife, as part of the Neart Na Gaoithe (NnG) windfarm project.

The UK and Scottish Governments have said they have no legal route to provide further financial support to the company, which was acquired by Canada-based JV Driver in April 2018 after the Scottish Government rescued BiFab in 2017.

Scotland’s Economy Secretary Fiona Hyslop MSP said on Tuesday that the main issue leading to the problems has been the “unwillingness” of parent company and majority shareholder JV Driver to provide working capital, investment or guarantees for BiFab.

In a statement on Friday, BiFab responded: “Scottish Ministers continue to focus on JV Driver’s alleged lack of investment, guarantees and capital as the primary cause for its current situation.

“This cannot be further from the truth.”

BiFab stated that, recognising the growing state aid challenges faced by Scottish Ministers early in 2020, JV Driver offered on numerous occasions to transfer some or all of its shares in BiFab to Scottish Ministers at no cost to the Scottish purse but Ministers never pursued it.

The company said: “This offer was made to facilitate an ownership position by Scottish Ministers that could support further investment if and when required.

“This offer was never pursued by Scottish Ministers. This offer still stands today.”

BiFab and its management were given no access or opportunity to address the BiFab Working Group set up by the UK and Scottish Governments and have not been contacted by it.

The company added: “Scottish Ministers also point to the lack of a long-term business plan as a secondary causal factor to the current situation.

“Again, this is inaccurate – JV Driver prepared a long-form multi-phase business plan for Scottish Ministers prior to acquiring BiFab.”

BiFab said many nations have local supply chain protections that limit the amount of international sourcing available to major energy infrastructure projects, but that no such legislation exists in Scotland or the wider UK.

It said that as a result, thousands of high-paying fabrication jobs are being lost to the Middle East and Asia and only Scottish and UK ministers have the ability to change this policy.

BiFab said ultimately it appears the NnG project will be lost to BiFab along with the 400 to 500 jobs it promised to create.

It said: “As a result of recent correspondence from Scottish Ministers, it is apparent that creditor support from the Scottish Ministers required to pursue critical solutions for BiFab will be unavailable.

“While incredibly disappointed, BiFab management continues to consider all options available to the business.”

The Scottish secretaries of the GMB and Unite unions, Gary Smith and Pat Rafferty, described the situation as a “growing scandal”.

They added: “The signal this sends out to the renewables industry is clear, it’s business as usual.

“The jobs of the future will continue to be exported to the rest of world and subsidised by the billpayer to the tune of billions.

“At best, Britain will get scraps off the table from its own offshore wind market, but it looks like both Governments have buried any credible hopes for a meaningful green jobs recovery in Scotland.”

Scottish Liberal Democrat leader and East Fife MP Willie Rennie said: “The Scottish Government are stealing away from the BiFab projects like a thief in the night.

“Ministers put on their high-viz jackets and promised my constituents that the future of the yards was secure. Now their promises have crumbled to dust.

“If Scotland is to bounce back from the pandemic we need highly skilled jobs, especially those that can deliver a green recovery. Instead it looks like BiFab is for the scrapheap just when we are seeing the construction of massive windfarms off the Scottish coast.”

The Scottish and UK Governments have been contacted for comment.


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