Scottish manufacturing firm Burntisland Fabrications (BiFab) has been placed into administration, the company has confirmed.
In a statement, the firm said it had “worked tirelessly” to support jobs in Scotland but that the “absence of supply chain protections” undermined its ability to compete with European rivals.
In October, Holyrood announced it had pulled financial support for BiFab, which is owned by Canadian firm DF Barnes and has yards in Burntisland and Methil in Fife, as well as on the Isle of Lewis.
The decision is thought to have caused the collapse of a £2 billion lifeline deal for the fabrication company to manufacture eight wind turbine jackets for the Neart Na Gaoithe (NnG) development.
A recent release by DF Barnes parent company JV Driver said that the contract would have created around 500 jobs.
In a joint statement put out last week, the Scottish and UK Government insisted there was “no legal route to provide further financial support” to the stricken firm, citing state aid rules.
BiFab was rescued from the brink of collapse by the Scottish Government in 2017 in a £34 million move, before being purchased by DF Barnes the following year.
In a statement, BiFab said: “BiFab can confirm that the board has agreed to place the company in administration following the Scottish Government’s decision to remove contract assurances.
“The company has worked tirelessly to bring jobs into Fife and Lewis with some success. However, the absence of supply chain protections in Scotland and the wider UK have consistently undermined our ability to compete with government-owned and government-supported yards outside and inside the European Union.
“We would urge the Scottish and UK Governments to address these structural challenges as a matter of urgency in order to ensure that the benefits of offshore renewables are shared more widely with communities across the country.”
Gary Smith, GMB Scotland secretary, and Pat Rafferty, Unite Scotland secretary, said the plight of the firm “exposes the myth of Scotland’s renewables revolution” and shines a light on “a decade of political hypocrisy and failure”.
They added: “The workers and communities dependent on these yards have fought so hard for a future and everyone was hoping that 2021 would finally be the turning point.
“Shamefully the Scottish Government has buried these hopes just in time for Christmas and they have worked together with UK Government in doing so.
“A decade on from the promise of a ‘Saudi Arabia of renewables’ and 28,000 full time jobs in offshore wind manufacturing, we’ve been left with industrial ruins in Fife and Lewis.”
The Scottish Government
In response to the news, Economy Secretary Fiona Hyslop confirmed the Scottish Government will work with administrators and unions to “secure a new future” for the mothballed yards in Fife and the Western Isles.
She said: “I know this will be an extremely worrying time for BiFab’s workers and we will continue to do everything in our power to support them and stand ready to work with any company interesting in taking on the yards. The skills and dedication of the workforce is recognised throughout the renewables and offshore industry and will play an important role in our future energy ambitions.
“The Scottish Government has been working for more than three years to support BiFab through the financial difficulties it has faced and remains committed to securing a future for the yards and the workforce.
“As a minority shareholder, we have been exhaustive in our consideration of the options available to us to support BiFab. There is no legal route for either the Scottish Government or the UK Government to provide further financial support to the company as things stand.
“In order to successfully secure and deliver new contracts, BiFab required working capital, the provision of appropriate assurance packages by the shareholders, and plans for investment at the sites. Despite commitments made at the time of acquisition, this is something the majority shareholder JV Driver was not willing to provide to secure future work.
“We will now work with the administrators and trade unions to secure a new future for the BiFab yards in Fife and the Western Isles, helping ensure they are able to diversify and compete in this competitive market.
“We have also committed to establish a joint working group with the UK Government to explore how existing policy measures can be used to strengthen the renewables and clean energy supply chain in Scotland. We continue to call on the UK Government to take more radical action to ensure that local renewables developments move away from a focus solely on price and better support the domestic supply chain.”