9. Scotland Builds the World Again 🟢

Naval yards on the Clyde and at Rosyth are among the busiest in Europe. The last commercial yard on the lower Clyde has no hull in the build hall. Ministers announced in March 2026 their intention to award four public vessels directly to Ferguson Marine. Those contracts are still under subsidy-control due diligence. Skills, college places, yard ownership and most civil vessel procurement are already Scottish. Defence orders are not. The commercial question is whether a continuous public pipeline can be made real before the remaining trades leave.

Current reality

Legal and institutional position

Ferguson Marine (Port Glasgow) is publicly owned following the 2019 intervention. Civil public vessels are procured mainly through Caledonian Maritime Assets Limited, Transport Scotland and the Marine Directorate. The Procurement Reform (Scotland) Act 2014 requires consideration of community benefits and allows social-value factors, subject to equal treatment. The Subsidy Control Act 2022 designates shipbuilding a sensitive sector. Direct awards must pass that Act’s tests. Scottish authorities apply those UK statutes.

Naval shipbuilding, the Type 26 and Type 31 programmes, export warship contracts and the National Shipbuilding Strategy sit with the Ministry of Defence. Skills, apprenticeships, college funding and economic-development grants are devolved.

The latest official numbers

Naval — Clyde (BAE Systems).
The UK has ordered eight Type 26 City-class frigates. Norway’s 2025 order is for at least five of the same design, valued at about £10 billion, described in UK parliamentary and ministerial statements as the largest UK warship export in modern times. Five Royal Navy hulls are under construction at once: Glasgow and Cardiff at Scotstoun; Belfast and Birmingham in the Janet Harvey Hall at Govan; Sheffield after first steel. Some Clyde slots have been allocated to Norwegian hulls; ministers have said the Royal Navy’s eight ships remain. HMS Glasgow is in systems commissioning at Scotstoun, with sea trials expected in late 2026 or early 2027. The covered hall allows two frigates side by side. Employment at BAE in Scotland is around 5,000, with a large apprentice pipeline and a company-stated plan to recruit hundreds more.

Naval — Rosyth (Babcock).
Five Type 31 Inspiration-class frigates are on a fixed-price contract originally near £1.25 billion, with delivery of all five intended within ten years of signature. HMS Venturer and HMS Active are in fitting-out. The keel of HMS Formidable, the third ship, was laid on 9 December 2025. HMS Bulldog is in early construction. Babcock has expanded work with HII on Virginia-class submarine assemblies from Rosyth, in addition to existing missile-tube work. Direct employment on the Type 31 programme is around 1,250, plus apprentices. Denmark and Sweden remain export prospects, not signed UK-style orders in the official record used here.

Commercial — Ferguson Marine.
MV Glen Sannox entered service after handover in November 2024. MV Glen Rosa left the Port Glasgow build berth in late July 2026 for Inchgreen, Greenock, for fitting-out, LNG commissioning and trials, with CMAL handover still aimed at the fourth quarter of 2026. BAE has finished work on the Type 26 unit. On 3 March 2026, the Deputy First Minister told Parliament that ministers proposed to award four vessels directly: two Small Vessel Replacement Programme Phase 2 passenger ferries, plus replacements for the Marine Directorate’s Scotia and Minna. That package is described as occupying most of the yard’s capacity for about five years and unlocking the rest of a £14.2 million modernisation (panel line, cutting, digital systems). As of mid-August 2026, the awards remain subject to legal, commercial and subsidy-control assessment. No steel-cut date exists because design typically takes a year after contract.

Workforce: mid-July 2026 figures used in official and company discussions were about 283 staff, including 34 apprentices, after a net fall of 18 in the year. On 18 August 2026, the company opened a voluntary redundancy process for about 70 posts, describing a gap after Glen Rosa. A contemporaneous breakdown put 247 core staff, 31 agency staff and 32 apprentices. Apprentices are stated as unaffected in the short term; 86 have been trained since 2019, with 24 new places across August 2026 and January 2027. Traditional hot-work trades in the core workforce have been reported as very small (single-figure platers, low-teens welders). That is a workforce-composition fact consistent with subcontract finishing on Glen Rosa; it is not a statistical bulletin.

Skills.
RAND Europe’s January 2025 study for Clyde partners and Skills Development Scotland found more than 8,000 people in surveyed Clyde maritime firms, high hiring and high loss, modest net growth, and persistent gaps in welders, platers, steelworkers, electrical and mechanical engineers if demand rose. Competition from offshore wind and infrastructure is explicit in that report.

Procurement.
CMAL awarded seven small ferries to Remontowa on price after Ferguson scored well on quality. Social value was not scored. Community benefits were negotiated after the preferred-bidder stage. The Lord of the Isles replacement is in competitive tender; Ferguson has said pre-qualification criteria effectively exclude it and other UK commercial yards. Northern Isles freight vessels went to a Chinese yard with no UK bid. Ministers have previously judged that a substantial subsidy for a different direct award would not have satisfied the Subsidy Control Act.

How it is experienced in daily life

In Govan a covered hall runs two frigates. In Port Glasgow the slip is empty. An apprentice at Ferguson can complete a year with little steel to practise on, then leave for BAE. An island community waits on Glen Rosa and on a small-vessel programme now being built in Poland. Inverclyde’s high-skill manufacturing base is one yard and a pending diligence file.

How it got here

Commercial Clyde capacity contracted over decades: East Asian competition, under-investment, industrial conflict, and larger ship types. Naval work remained. Ferguson’s 2015 dual-fuel pair became a multi-year overrun after nationalisation in 2019. Public ownership kept a site and a payroll. It did not, by itself, produce a follow-on book or a deep core of platers and welders. CMAL’s lowest-compliant-price practice, and caution on subsidy control, sent subsequent civil tonnage abroad. Naval strategy produced the opposite: a 30-year government demand signal and export work.

What has already been tried, and what that showed

Nationalisation completed two ferries, late and over the original combined budget. Type 26 subcontract units were delivered. A £14.2 million modernisation is only partly unlocked because it is tied to the four-vessel plan. Direct award was refused for SVRP Phase 1 and for the Lord of the Isles replacement. The March 2026 four-vessel intention is the current test of whether a public owner can give its own yard work without failing the 2022 Act. Five months on, diligence continues, and the yard is cutting staff. Apprentice numbers can be announced faster than hulls.

What needs to happen

The improvement in measurable terms

• A signed four-vessel programme, or an equivalent continuous civil book, so the Port Glasgow hall is not empty for a year.
• Core welding and plating employment high enough that apprentices have work to learn on.
• Social-value or equivalent scored criteria on civil competitions where the law allows, published in the notice, not only as after-the-fact community benefits.
• Modernisation kit installed against a live order, not against a proposal.
• Clyde skills gaps in the RAND critical trades narrowing in the next SDS/industry snapshot.

Sequence

Close the diligence on the four vessels, or state why the Act forbids them. Sequence design so steel-cut follows with the shortest legal gap. Hold the core trades through that gap. Install the panel line. Only then chase additional commercial and offshore-wind work. Training volume should follow the book, not lead it by thousands.

Workforce, capital and standards

Welders and platers are the constraint RAND named. BAE’s academy and Ferguson’s 24 new apprentices are not the same scale as the naval demand signal. Capital at Ferguson is modest next to Govan’s covered hall. Delivery confidence is the standard the last two ferries failed; any new award has to be measured on that, not on occupancy alone.

What would count as success in twelve months

• Parliament updated with a yes, a no, or a dated condition on the four awards
• Glen Rosa handed to CMAL
• Steel-cut or a locked design date for at least one of the four
• Voluntary redundancies not stripping the remaining hot-work core
• A CMAL notice that either scores lawful social value or explains, in legal terms, why it cannot

Twelve months will not restore a commercial Clyde. It can show whether the public owner intends to keep one.

What can be done under current powers

Who holds the lever

Scottish Ministers: Ferguson ownership, Marine Directorate vessels, Transport budget, skills money. CMAL: civil ferry competitions, within the 2014 Act and subsidy control. SDS and colleges: apprenticeships. BAE and Babcock: naval employment, reserved customers. MOD: the warship book.

The statute, budget or direction

Procurement Reform (Scotland) Act 2014; Subsidy Control Act 2022; annual Budget; Ferguson’s articles as a public company; college and MA programmes. Defence procurement is reserved.

What is already possible and unused

A completed diligence decision. Scoring of quality, delivery confidence and skills in ways that do not discriminate by nationality. Publish the civil vessel pipeline early so a yard can hire. Tying the remaining £14.2 million to milestones. College places matched to named trades. Direct award where the 2022 Act is satisfied — the March statement already asserts that path is being tested.

What would still be true if management improved tomorrow

Norway’s ships would still be a UK export. CMAL would still have to treat overseas bidders equally. Private offshore-wind buyers would still go to Spain, Poland or Turkey if the price is lower. A year of design would still sit between contract and first steel. Better management at Port Glasgow cannot invent a Type 26 order.

Where the limits are

Law and reserved powers

Naval orders are reserved. Subsidy control and non-discrimination bind civil awards. A “Scottish-only” tender would fail. A lawful direct award is possible; it is not automatic.

Money

Glen Sannox and Glen Rosa consumed far more than the 2015 combined price. Four smaller vessels are a Budget and subsidy-control problem, not a small grant. Naval capital is UK and company money.

Workforce and capital

Seven platers and eleven welders, if that composition holds, cannot start four hulls. The covered naval hall is not transferable to Port Glasgow by speech. Offshore wind is recruiting the same people.

Time, geography, UK-wide systems

Design lag. Five-year occupancy only after contract. UK National Shipbuilding Strategy and AUKUS supply chains run on reserved clocks.

Political difficulty, kept separate from legal impossibility

Awarding to the public yard after the last pair’s cost is unpopular. Awarding abroad after that history is also unpopular. Diligence delay is a political cost. It is not proof that the Act always forbids the four ships.

What is not yet known

The outcome of the subsidy-control assessment. The date of any contract or first steel. Whether the 70 voluntary redundancies proceed, and in which trades. Glen Rosa’s actual handover date and final cost. Whether Denmark or Sweden order Type 31 derivatives. The next official Ferguson headcount after August 2026. A reconciled public account of how much of the £14.2 million is spent.

Honest summary

Achievable now. Own the yard. Train. Modernise. Sequence Marine Directorate and CalMac work. Use the 2014 Act to the edge of equal treatment. Complete or abandon the March 2026 proposal in public.

Only partly achievable. A large commercial sector competing on world price. Capture of North Sea wind vessel orders. Continuous occupancy if diligence fails or design slips.

Would require reserved change. Directing Type 26 or Type 31 work. Rewriting the Subsidy Control Act. A UK social-value mandate that overrode CMAL’s current legal advice.

Colour mark: green. The commercial problem is not the absence of a shipbuilding power. Ferguson, CMAL, skills and the civil fleet are already Scottish. The empty hall in August 2026 is a use-of-powers problem: a proposed award without a contract, a modernisation locked to that award, and a workforce being reduced while due diligence runs. Green does not mean easy, and it does not mean Holyrood can replicate the naval renaissance. It means the last commercial yard will stand or fall on decisions already on the Scottish desk.

What this item does not settle. It does not claim Clydebuilt commercial volume can return to the nineteenth century. It does not treat every overseas award as unlawful. It does not merge BAE’s 5,000 jobs with Ferguson’s 280. It does not treat a £10 billion Norwegian contract as a Scottish Budget instrument.

The test is simple. After Glen Rosa, is there a hull, a signed design, or only a statement?

Connection

Item 7 (training) is the same apprentice and welder constraint. Islands and ferry items are why CMAL’s book matters beyond Inverclyde. Energy and offshore wind compete for the same trades. Public finances pay for both the overrun and any new award. The Independence Debate is about reserved defence industrial capacity, not whether ministers can finish a diligence file.

People’s Future Scotland