The Scottish Trades Union Congress has accused the multi-national company Seaway Heavy Lifting (SHL) and its parent group, oil-field services supplier Subsea-7 of engineering the near-bankruptcy of the Bi-Fab contractor.
Two weeks ago, the Fife-based firm – which employs some 1,400 people at Methil and at Arnish on Isle of Lewis – said it was going into Administration because it had not been paid by SHL scheduled payments for its £100 million order to build 26 platforms for wind turbine towers in SSE’s Beatrice wind farm in the Moray Firth.
Although the Scot-Govt has now stepped in with a commercial loan facility to BiFab to enable work continue – and pay its workers, who marched on Holyrood in protest.
But Grahame Smith, General Secretary of the STUC has said that – prompted by parent group Subsea-7 – SHL altered the spec of the Bi-Fab contract construction work so often so as to justify it claiming on a ‘performance bond’.
He said: “What has happened at BiFab is nothing short of a disgrace and is as clear example as you will ever likely find of unacceptable behaviour from a multinational company.
“The customer, SHL, simply refused to pay the supplier, BiFab, for work that has already been done.
“The workforce of the company was left to face the consequence of there being no money to pay their wages beyond the end of this week if no solution was found.”
“You had a situation where SHL, part of a multinational company called Subsea 7, had taken out a performance bond -in effect an insurance policy – to insure itself against the prospect of the order not being completed.
“Surprise, surprise SHL, having changed the specification of the order on several occasions, claimed that BiFab hadn’t performed to its expectations, therefore cashing in the bond. I will tell you it is a lot of money.
“You might also be surprised to know that substantial part of that bond is underfunded by the UK Government, in other words, us as the taxpayers.
“If BiFab went to the wall and fell on the contract, SHL would have immediately pocketed the <insurance> money – all at the expense of 1,400 jobs at BiFab and a big chunk of taxpayer money.”
- SHL and Subsea-7 were asked to provide a comment in reply to the STUC prior to publication. They did not reply.
22 Nov 2017
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