Breasclete – a failure that became a success

The BASF plant at Breasclete is one of the success stories of the Western Isles economy, providing 80 well paid jobs with an international company in the pharmaceutical industry.

By Brian Wilson
Friday, 6th May 2022, 4:43 pm
The BASF Callanish factory complex as is today, complete with additional building opened 10 years ago.
The BASF Callanish factory complex as is today, complete with additional building opened 10 years ago.

But why is it there? The answer takes us back to another age in the philosophy of Highlands and Islands Development when “risk-taking” was an essential badge of honour, leaving legacies which would not otherwise exist. BASF at Breasclete is among them.

Forty years ago, the original Breasclete vision died when Lewis Stokfisk went bust. However, the abiding moral of the story is that if you build and invest, a use will be found. If you never take that risk, the absolute certainty is that nothing will happen. Without risk, there can be no legacy.

The story had its origins in the mid-1970s when the Highlands and Islands Development Board was chaired by Sir Andrew Gilchrist, who had previously been Ambassador to Iceland. Sir Andrew knew his fish politics and supported a board member, Prophet Smith, and the head of the fisheries division, Jim Lindsay, who believed strongly in the potential of the Western Isles.

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That case – then as now – is borne out by any chart of fishing activity to the west of the Hebrides. Spanish, French, Danish, Dutch, British fishing vessels… all taking wealth from these waters and virtually none of that value ending up in the Western Isles. Surely there had to be a better way?

Prophet was a great guy; a Shetlander who had been an organiser with the Seamen’s Union, appointed by Willie Ross to the HIDB board at its inception in 1964 with full-time responsibility for fishery expansion. He was dismissive of the received wisdom that cultural differences accounted for the Western Isles failure to develop the same substantial fishing industry as Shetland. The difference, he believed, lay in lack of money for investment.

With Gilchrist’s encouragement, enthusiastically adopted by Ken Alexander when he took over in 1976, Prophet Smith and Jim Lindsay produced a blueprint for “Hebridean Fisheries” which was submitted to the Secretary of State for Scotland, Bruce Millan, in 1977. When the plans – which envisaged major on-shore developments at Breasclete and Ardveenish – were unveiled, they received an enthusiastic response.

Bruce Millan quickly approved plans to build a pier and acquire the land at Breasclete. Norwegian Per Stoknes had been in touch about the potential of Breasclete for the same fish drying operation he ran in Norway. The HIDB decided to take the initiative, supporting Stoknes through public investment to create Lewis Stokfisk.

The factory would require 5500 tons of fish a year – roughly in proportions of saithe 730, tusk 200, blue ling 300, white ling, 1560, blue whiting 2400 and mackerel/herring 500. That mix would demand a transformation in catching capacity and it was this supply side of the equation which was, from the outset, problematic.

An internal HIDB report stated: “It is clear that the Norwegian system of lining which is designed for the pursuit of white ling as a main target should be followed but the Board is under no illusion that even two or three vessels and the training of their crews will necessarily be an easy matter. However, there is time on the side of the Board since the proposed factory would not be in production until the spring of 1978 or in full production until 1980”.

On that basis, the project proceeded amidst great optimism. The supply issue was addressed by helping a Lewis family to acquire the ‘Anni Elisabeth’, a Scandinavian vessel, and equip it with automated lining. Willie John Macleod and his three sons were to own the boat, skippered by Robert Mackinnon who was training at Lews Castle College. A second vessel, the ‘Grampian Crest’ was owned and crewed by experienced line fishermen from the east coast.

As James Grassie recalled in his valuable book, Highland Experiment, things soon started to go wrong. “The ‘Anni’ had made four voyages with encouraging results, but the factory opened its doors only to trouble. For the following 12 months it staggered from uncertainty to uncertainty. Its chief difficulty was that it could not obtain adequate supplies of fish. The owners of the ‘Anni Elisabeth’ were not happy with the prices they were offered and, because of that, were loath to exchange the traditional Scottish practice of catching varied species ….for the Norwegian custom of targeting on the particular fish the potential buyer wanted”.

Lewis Stokfisk brought in fish from Norwegian vessels – at a cost. Grassie wrote: “Relations between the Norwegian management and the community deteriorated. Heated words – and one occasion a blow – were exchanged in the local bar. Losses mounted. Lord Mansfield, Minister of State at the Scottish Office, formally opened the factory in the early summer of 1979 and when it was visited a month later by Prince Charles, special arrangements were made to ensure sufficient fish was landed to have the factory working”.

Per Stoknes was a brusque, difficult individual who succeeded in falling out with just about everyone. By late 1979, the quality controller, Dr Alastair Fraser, a respected local figure, had resigned and the production manager, Donald Macleod, was sacked. A community meeting passed a motion of no confidence in the management while Willie John Macleod said the ‘Anni Elisabeth’ would not return to Breasclete until it changed. The ‘Grampian Crest’ went into liquidation.

James Grassie wrote: “Though this was a period in which the Board saw disaster looming, it did not move publicly. Away from the public forum, Jim Lindsay was trying to solve the basic problem – lack of fish supplies. Persuading the owners of the ‘Anni Elisabeth’ was no easy task but one ray of hope unexpectedly emerged – the willingness of Faroese boats to land at East Loch Roag”. The ‘Anni Elisabeth’ returned and the factory agreed to take by-catches as well as species in which it was primarily interested.

There was a brief period of renewed hope. However, another critical event had occurred – a change of Government. While the Labour-run Scottish Office backed both the HIDB in general and specifically the Western Isles fisheries strategy, a very different climate emerged under Mrs Thatcher. For those opposed to the whole principle of public intervention in the free market, the Breasclete project became a very useful stick with which to beat and weaken the HIDB.

It came as no surprise when the Public Accounts Committee of the House of Commons took an interest in 1981. Before it could report, however, the HIDB itself decided to pull the plug on Lewis Stokfisk. Nigeria, with a massive appetite for dried ling and tusk, had become the dominant market and when the introduction of currency controls meant payments were no longer being received, this became an adequate reason for sending the company into administration.

The Public Accounts Committee report, published in August 1982, was predictably critical, finding that the Board “appeared to have continued to commit support to the Breasclete factory beyond the point at which a dispassionate re-appraisal should have led it to call halt”.

In all, the HIDB had committed £3.9 million to the project – about £18 million in today’s money which is scarcely in the Ferguson shipyard or even Prestwick Airport category! But the ramifications extended far beyond Breasclete.

The PAC noted: “The appraisal of this project showed that the fishing industry, on which it depended for success, were doubtful about its prospects. Further, it involved record costs for each job it was hoped to establish. In these circumstances, the Board needed to be more sure of itself in taking the decision to proceed … Nor are we satisfied with the Board’s monitoring of the project once it went ahead”.

The Committee recommended that the Treasury and Scottish Office should in future impose “a more stringent financial regime” and “more precise financial objectives” upon the Board. It was the end of the HIDB’s status as a relatively free-wheeling body, licensed to take risks in the interests of redressing disadvantage and past history.

The Committee noted that unemployment in the Highlands and Islands was lower than in the country as a whole – statistics that took no account of differentials within the region.

Bitter exchanges followed about where responsibility lay, particularly when it transpired that Robert Cowan, the new HIDB chairman, told the Committee: “The Stornoway fishermen persisted in viewing the Lewis Stokfisk development as a factory which had been placed there for their convenience to absorb landings of whatever kind of fish they happened to be catching as a by-product of their main prawn-trawling exercise; and continued to ignore the fact that there were specific species of fish for which the drying operation had markets”. He blamed the “conservatism of the industry” for the factory’s failure.

So was Prophet Smith wrong and Robert Cowan right? Was the “west of Hebrides” vision doomed to failure or was it a victim of inadequate consultation before adopting the Norwegian model? Will there ever be another opportunity to turn the riches of the East Atlantic into prosperity for the Western Isles? Or was that vision unrealistic in the first place? All good questions.

But then there is the longer view of history. Looking at Breasclete today, it is difficult to argue that the public purse did not get value for its £18 million.

The pier, still owned by HIE, is heavily used by the salmon farming industry and the factory, much expanded, has passed through various phases – initially connected to its maritime location and now with little link to it – to provide quality jobs and good earnings 40 years on. And that, really. was the idea in the first place.