Ferguson shipbuilder in Port Glasgow goes into administration Published duration 15 August 2014

media caption The last remaining shipyard on the lower Clyde goes into receivership with the loss of up to 80 jobs

Administrators have been called in to the last remaining shipyard on the lower Clyde with the loss of 70 jobs.

Staff at Ferguson Shipbuilders in Port Glasgow turned up to work on Friday to learn most of the 77-strong workforce were being made redundant immediately.

Joint administrators from KPMG said the business had gone bust due to a lack of orders and mounting cash flow pressure.

GMB official Alex Logan said staff were "shocked". The Scottish government is to set up a task force to help workers.

Skeleton workforce

Mr Logan said: "There was no warning about this at all and it has come as a complete shock to the workforce.

"We've had an idea since before the summer that something was going on but have been unable to get any information from the management.

"We thought that maybe the yard was going to be sold but there was no indication it was going to close."

The GMB said a "skeleton staff" had been retained to finish work on existing projects and help maintain the yard.

Mr Logan was attempting to organise a mass meeting of staff to discuss their options.

Blair Nimmo, joint administrator and head of restructuring for KPMG, said: "Ferguson Shipbuilders is a leading name in the industry with a rich heritage dating back more than 110 years and is the last commercial shipbuilder operating on the River Clyde.

"However, a lack of significant orders and mounting cash flow pressure has led to the group's inability to continue trading.

"We would like to thank staff for their co-operation during this difficult period. We will be working with employees and the relevant government agencies to ensure that the full range of support is available to all those affected."

image caption Administrators made 70 of the 77 staff at Ferguson Shipbuilders redundant on Friday morning

Mr Nimmo added: "We would encourage any party who has an interest in acquiring the group's business and facilities to contact us as soon as possible."

Originally formed in 1902, Ferguson Shipbuilders employed 77 staff at the time of the administration appointments.

Trading problems

Whilst best known for its shipbuilding capability, the yard is also known for engineering and joinery, materials handling, fluids distributions, system hydraulics, power distribution and management and civil engineering.

KPMG said the business had "experienced significant cash flow pressure in recent months" and a "lack of financial strength" had effectively "hindered its ability to secure new vessel contracts from its core customer base".

Recent attempts to secure investment into the business have proved unsuccessful, the administrators said.

They are now "assessing all available options" to complete the yard's remaining work and are aiming to determine "whether an early sale of its business, infrastructure, and assets can be secured".

Jim Moohan, GMB Scotland senior organiser and chair of the Confederation of Shipbuilding and Engineering Unions (CSEU), called on First Minister Alex Salmond to intervene.

He said: "This is the last remaining commercial shipbuilding yard in Scotland. It has now locked its doors to the workforce.

"Unless the Scottish government intervenes this puts the final key in the door of commercial shipbuilding which has a history of several hundred years in Scotland.

"Not to intervene will be an utter betrayal by the Scottish government and the First Minister, Alex Salmond."

Finance Secretary John Swinney said the Scottish government would set up a task force to help workers affected by the closure.

"The loss of any jobs in Port Glasgow is a devastating blow and we will work closely with the administrator to deliver an integrated service to those losing their jobs," he said.

'Significant assets'

"We will also convene a task force which will aim to secure new opportunities for this commercial shipyard on the Clyde.

"I have spoken to the leader of the council and we have agreed to work together on the task force to secure these opportunities. I will visit Port Glasgow on Monday to start this process."

Mr Swinney described the yards facilities and workforce as "significant assets".

image caption The yard in Port Glasgow dates back to 1902

image caption The yard is the last commercial shipbuilder operating on the Clyde

image caption The GMB union has called on the Scottish government to intervene to save the yard

News of the firm's financial failure has brought strong responses from the local community and across Scotland.

Scottish Labour leader Johann Lamont said: "My sympathy goes out to all the workers at the Ferguson shipyard whose jobs are threatened and we will do all we can to prevent the closure of the yard.

"Scotland's shipbuilding industry is a vital part of our economy and supports many well paid jobs but it is still largely dependent on defence contracts and this latest blow highlights just how difficult it is to win other contracts.

'Serious questions'

"But I believe we can still save this shipyard and every avenue must be explored. We stand ready to work with the Scottish government and do all we can to prevent job losses as a matter of priority."

Scottish Conservative west of Scotland MSP Jackson Carlaw said: "The Scottish government certainly has some serious questions to answer on this.

"They must have been alerted to this situation coming down the tracks.

"Dithering when dozens of jobs are at stake is completely unacceptable, and the workers deserve a full explanation."

Inverclyde Council leader Stephen McCabe said: "I am shocked by this news about Fergusons but can assure the workforce and community that we will do all that we can to help.

"I am setting up a dedicated task force to support the workforce at Fergusons and to engage with the owners, union and both the Scottish and UK governments."

David Watt from the Institute of Directors said: "Given the proud heritage Scotland, and particularly the Clyde, has in shipbuilding, it's sad to see one of the few remaining yards in jeopardy, potentially significantly reducing Scotland's capabilities in the future."

The yard also completed work for Babcock related to the contracts for two huge Royal Navy aircraft carriers.

GMB official Mr Logan said that at the time of the administration, work was also ongoing to convert a boat into a fish factory - for a company based in the north of Scotland.