SHETLAND Islands Council should never repeat the failings that led it to spend £14 million on two defective tugs from an inexperienced Spanish shipyard, a report to councillors this week has said.
The report highlights an extraordinary catalogue of failings surrounding the purchase of Solan and Bonxie in February 2011.
In the past few months the council managed to sell the two tugs to an Italian port for around half their purchase value, while claiming they had actually made a £70,000 profit based on the work the vessels had carried out during their brief working life in Shetland.
The two tugs built by a Spanish shipyard in Valencia were unpopular with the port’s experienced tug crews from the moment they arrived five years ago.
Those concerns culminated in crews refusing to board them after Solan collided with the oil tanker Loch Rannoch the following December, in what staff described as a “classic nightmare scenario”.
The tugs suffered from severe steering and handling problems that the council spent £60,000 to resolve with new fins welded onto the vessels’ hulls.
This week’s report follows a six month internal investigation and throws light on just how seriously management got things wrong at the Sella Ness port with their plan to reduce the tug operation to three vessels by buying in two powerful new boats.
The report, which was discussed in private, highlighted a poorly defined project carried out with insufficient research that was badly documented from the word go.
There was insufficient discussion and consultation with key stakeholders and crews about building new tugs rather than looking for a suitable “off the shelf” design.
Marine advisers were appointed who appeared to have no tug experience, while the order was placed with a shipyard with little background in building tugs.
The council’s capital projects department was excluded from the entire process, and there was no clear policy to supervise the project even while changes were made during their construction.
The tugs were accepted and brought to Shetland despite the council knowing they had “directional stability issues” and little effort was made to listen to the concerns of sea staff working on the boats.
In fact the report alleges that concerns raised by the tug crew unions about the proposal of moving to a three tug operation were deliberately suppressed.
Councillors have been assured that such a catalogue of mistakes can no longer be repeated after the council introduced a more rigorous approach to project appraisal through the Business Gateway process.
Senior staff and councillors have been given enhanced training in project management and there has been a “culture change” in relations with staff at the Sella Ness port, the report says.
SIC infrastructure director Maggie Sandison, who carried out the investigation, said she could not discuss a confidential report as it might infringe the rights of former council employees.
However she did say that having examined in detail what had gone wrong with the tug project, she was confident the improvement plan that the council implemented in 2011 would address all the issues her report raised.
“The improvement plan we implemented in 2011 that looked at governance and risk management ensures a good case is now made for where we spend money,” she said.
“I have looked at what went wrong (with the tugs) and that should be covered by the council’s new way of working, and those issues should not arise again.”