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Sail Away

Sail Away

 

It does not cost £200m to build a ferry but then the government minister who is reported to have said, “I didn’t say, ‘don’t go-ahead’…” has clearly never negotiated a commercial contract before entering politics.  Incidentally, it makes no more sense to tell a stranger that you’ve only got a couple of notes in your wallet than it does to announce how much a government is willing to spend – £100m – before putting another contract for ferries out for tender.  You don’t get to act surprised in either case just because you’re a muppet.

 

In defence of the Scottish Government, journalists don’t have long memories and Unionist voters with an axe to polish have shorter memories still: at the time of the tender, there was deep unease that having been promised contracts to build new destroyers for England’s navy if Scotland voted ‘no’, the orders didn’t then materialise and the shipyard, to say nothing of the skilled engineering jobs, were at risk.  But anyhoo…

 

Other nations build ships.  Other nations are also very good at not only designing ships but offering licensing arrangements on those ship designs which ensure that both the vendor and the purchaser are able to enjoy government contracts.  For example, the Dutch build boat parts which are shipped to Indonesia for assembly, ensuring there are jobs in both nations, keeping both governments and the voters in respective nations happy.

The licensing of other nation’s technologies is common in business.  How else did you think different phone manufacturers all got touchscreen displays with icons representing different software apps?  It wasn’t mere coincidence.

 

The world over, factories turn out copies of other factory’s designs.  It makes far more sense than transporting goods, especially large, heavy goods like vehicles, across the planet when we’re all supposed to be reducing emissions.  Using licensed designs from the Netherlands, Scandinavia, the United States or wherever ferries are put to sea carrying around 300 passengers and 50 cars, would have allowed the Scottish Government and ferry operator CalMac to have made assessment and comparison of options available and to be able to demonstrate to taxpayers the benefit of a particular design already in use.  As many ferry operators are run as for-profit services, they’d have only been too glad to recover some of their set-up costs in return for a regular royalty payment. 

 

The savings to the public purse are in copying proven success and not having to constantly come up with an ever more elastic source of funds for a prototype continually being altered before completion.

 

A cleverly-negotiated licensing deal would have allowed for some modification of the original design, allowing the licensor to utilise any improvements and modifications made to the original design for a suitable reduction in the amount the licensee – the Scottish Government/ CalMac – had to pay.

 

The benefit of licensing the technology is that you also get a benchmark for production costs.  This is important if the shipyard in Scotland is not producing its own engine and IT.  If working with different solutions providers, the alternative vendors for navigation, climate control and so on have plans already laid out and can begin work on their tendering process.

Licensing makes sense because successive Tory and Labour governments in London have stripped out Scotland’s engineering history, cutting it back to the quick in ever more regressive rounds of privatisation and cost-cutting.  Innovation and improvement needs investment and we simply haven’t had that at anything like the level enjoyed by companies in the EU.  It should be a source of shame that the outfit of two aircraft carriers required steel purchased from a totalitarian nation with geopolitics that are diametrically opposed to those of the UK, a NATO-member but Ravenscraig doesn’t even linger as a ghost today such are the security credentials of England’s Tories.

 

The drawback to licensing existing technology with the inherent transparency of the deal negotiated, is that the legislation governing how businesses operate in other legal jurisdictions would ensure it was much harder to obscure the lobbying process which is perhaps why questions around the ferry business have lingered longer than the ordure from the weekend’s beer and curry.  Mandy Rhodes’ article in The Sunday Post actually used the words “cover up”.

 

But consider that there is also an extramural benefit from licensing the technology of other nations: diplomacy.  If Scotland is to one day be independent, future trading allies need to be confident that we’re going about things the right way.  Giving them money in exchange for opportunity to share their stuff because we think it’s great is a better form of flattery than a fancy tea with Mrs Windsor because governments, here in Scotland and overseas, value things which create jobs and wasn’t that the whole point of the ferry farrago to begin with?

Andrew Bentley Steed

Andrew Bentley Steed

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