FSB hits out at confidence in planned operator for Arnish

By Donnie Macinnes donnie.macinnes@stornowaygazette.co.uk

Despite meeting top island politicians, the Federation of Small Businesses remain unconvinced that Cambrian Engineering Ltd is the most appropriate company to take over the lease of the Arnish site.

The Federation said they they failed to understand where the confidence in the new company — Cambrian Caledonian — was coming from, especially as it was only formed in April and therefore had no track record.

They made the comments after a weekend meeting with MP Calum Macdonald, MSP Alasdair Morrison and Chief Executive of Western Isles Enterprise, Donnie Macaulay to discuss the circumstances surrounding the Arnish development.

Following the discussions, Federation members said they remained unconvinced that the activities of Cambrian Engineering were adequately monitored and that sufficient care was being taken to ensure that Cambrian Caledonian is the most appropriate company to take over the Arnish lease.

The FSB said they had been assured that the WIE funding which Cambrian Engineering received was spent on capital goods, match funded and issued on production of receipts.

But Hamish Fraser, Highlands and Islands chairman of the FSB, said: “If this was the case, we would expect there to be around 2million worth of assets at the Arnish premises and we think this unlikely. In my opinion, it appears that there was a certain naivety and a lack of business acumen involved in the decision to support Cambrian Engineering. We were told that Cambrian failed because of a few bad decisions, a breakdown in the relationship with a major client, and a shortage of contracts. This would suggest that the company had neither the management skills nor an adequate knowledge of the market to enable them to succeed.”

Regarding the new company — Cambrian Caledonian — that had declared an interest in the Arnish site, Western Isles MSP Alasdair Morrison stated: “I am happy to emphasise again, as I outlined on Friday, that Cambrian Caledonian is not the same company as Cambrian Engineering. It is owned and run by totally different individuals who have wide and diverse experience in the highly competitive oil and gas industries.”

But the Federation took a different stance.

They stated: “We have been informed that Cambrian Engineering is totally unconnected to Cambrian Caledonian, the company under consideration for the lease at Arnish, and that it is just an unfortunate coincidence that the company has used the name Cambrian. We have been assured that David Williams, who was Managing Director of Cambrian Engineering, is not a director of the new company but he has been employed there on account of his experience in the industry.”

Hamish Fraser stated: “Western Isles Enterprise are placing a great deal of confidence in Cambrian Caledonian. We fail to understand where this confidence is coming from. The company was only formed in April of this year. They cannot possibly have a successful track record. We are assured the Managing Director has the required financial backing and experience, but if this is the case why would he employ one, or possibly two, individuals who have just failed miserably in the same venture and why would he use the same name as the company which has just failed?”

Mr Fraser continued: “There is a lot of talk about risk-taking and entrepreneurship. We are being told that any venture at Arnish is bound to be risky, that risks have to be taken and, as business people, we should understand this. We do understand that business people take calculated risks but they are not foolhardy. We do not believe that those making the decisions at Arnish have sufficient understanding of business issues. They appear to be taking a gung-ho attitude to the use of public funds and the well being of the community. The latest public sector buzzwords may be ‘risk-taking’ and ‘entrepreneurship’ but bandying these words about does not justify making a quick decision in order to ensure that at least one company, with a questionable connection to renewable energy, is in situation at Arnish.”

Mr Fraser concluded: “Everyone involved in securing the funding and bringing Arnish to its present state must be congratulated, but the future of the yard and the economy of the island must not be jeopardised by political or self-interest decisions.”

MSP Alasdair Morrison said that Hamish Fraser had admitted the strategy where they were demanding WIE to bail out Cambrian Engineering was a flawed strategy. It was not within the remit of a local enterprise company to do this, he said.

Mr Morrison went on: “As chairman of the Arnish Development Group, I remain focused on the retooling and the development of the yard and its environs.”

He could not quite understand why the Federation were taking the such a stance on the issue.

“The bottom line is that if another company is coming in to Arnish, they will need to have orders and I hope that Cambrian Caledonian secure orders and we will see the redevelopment of the yard,” said Mr Morrison.

He added: “I welcome the Federation’s interest, although it is belated. I request them to try and assist us in the potentially very exciting plans for windfarms in Lewis — and I hope we can rely on their support.”