BiFab hits back at Scottish government's investment claims

BiFab has hit back at Scottish government claims that the Canadian company with a majority stake in the Fife and Lewis fabrication yards failed to invest in them.

In September, BiFab lost out on a major contract after ministers withdrew their offer of a £30m guarantee.

The government cited European rules against subsidies to commercial firms.

BiFab said the Canadian owner had repeatedly offered to offload shares to the government at no cost.

It said this would give the Scottish government - which owns a third of the company - more flexibility to back it.

BiFab said the offer had not been taken up, but still stood. And it said ministers' statements about it had been inaccurate or untruthful.

It claimed the Canadian parent firm, JV Driver, responded to a Scottish government invitation to become involved three years ago, on the understanding that ministers would provide most of the finance required to win new contracts.

The Fife-based firm described itself as "perplexed and disappointed" at recent developments.

The Scottish and UK governments recently set up a working group, agreeing this week that there was no legal way to provide the financial guarantee.

The Scottish government claimed JV Driver had refused to provide finance, guarantees or investment.

And it claimed its own role was to manage - not finance - the projects.

Economy Secretary Fiona Hyslop said ministers had "left no stone unturned in our search for a solution to the challenges faced by the business".

She said the UK government had similarly concluded that there was no legal route for it to provide support.

She added that the Scottish and UK governments would now attempt "to secure a new future for the yards in Fife and the Western Isles".

BiFab said it was not contacted by the working group and was given no opportunity to address it.

The Scottish government has so far put £37m into BiFab, in equity and loans, and offered a further £15m loan facility.

The contract in dispute, which is now expected to go elsewhere, would be to build eight platforms or jackets for a 54-turbine wind farm off the coast of Fife, being developed by EDF and Saipem at a cost of nearly £2bn.

That element of the work would support more than 400 jobs for the period of the contract.

Scottish Labour's economy and jobs spokesman Alex Rowley called for UK and Scottish Parliament inquiries into "an act of sabotage against Scotland's manufacturing base that has already been decimated".

He added: "It confirms that the SNP government's pleas of 'no alternative' are simply weasel words from a party with no political will to secure skilled jobs in Scotland for the renewables sector.

"That the same SNP is this weekend speaking about a 'Just Transition' is a grotesque insult to the workers and communities in Fife and the Western Isles."

Scottish Greens MSP Mark Ruskell said: "The Scottish government cannot bemoan the fact that it's a minority shareholder with no seat on the board while at the same time turning down opportunities to step up and become a majority shareholder.

"Bifab urgently needs a recovery plan that can secure interim work and deliver promised green jobs while the Scottish government works towards state ownership that is still in line with market rules it has to adhere to."

A Scottish government spokesman said the economy secretary was "clear" that state aid rules made intervention impossible.

He added: "The situation at BiFab is a culmination of a number of issues, the main one being the unwillingness of the parent company and majority shareholder JV Driver to provide the working capital investment or guarantees for the company."

The UK government did not wish to comment