The government has a unique opportunity to engineer the privatisation of the shipyards in a way that will give this important industry the best chance of success. But to do this it must take a step back and consider taking on board the very valid advice given to it by the Malta Labour Party, the GWU and qualified independent economists who know a thing or two about good strategic management.

As I write this article, a new development has just emerged in the form of a mediator who has offered to bring the two sides in the privatisation dispute nearer to each other. There is a good basis for reaching a reasonable agreement since practically everyone is now accepting that privatisation is the best way forward for our state-owned shipyards. This wide spectrum of consensus which has bridged also the political divide offers the best basis for a successful conclusion of the process. This implies that such conclusion would be beneficial to the country and every taxpayer. Moreover, it will also offer good prospects to the 1,700 workers and their families involved. Hopefully, an agreed solution will close once and for all a series of chapters that have seen different administrations over the past 50 years grappling unsuccessfully with the viability of the shipyards.

The shipyards industry needs to start a new chapter to exploit the opportunities that exist in the market at present. To do this all the stakeholders now agree that it should be private management that will lead the business forward to commercial success. Hopefully, the shipyards will in future make the headlines not because of some acrimonious dispute, but because they will be creating wealth that will, among other things, enhance the employment prospects of the workforce.

It is, therefore, important for the government to redefine its plans so that the critical mass of skills that exist in the 'yard at present is not dissipated in a way that will create major problems for the new operators to rebuild a viable industry based mainly on local labour. There are various models that can be adopted that will give a better chance of ensuring that the highly skilled human resources at the 'yard today will continue to give their service to the shipyards industry.

The Portuguese shipyard of Lisnave, for instance, after two failed attempts to restructure their business, finally found a model based on utilising pools of skilled ex-shipyard workers organised in cooperatives to supplement the reformed yards' much reduced workforce when production requirements peaked.

Today, more than 10 years after the last restructuring effort, this Portuguese shipyard is no longer in need of state aid, is earning a respectable profit, has a growing order book, and is led by sound international management systems based on strategic alliances with some of the best-of-breed engineering firms in Europe.

Malta had similar successful experiences with the use of cooperatives when, for instance, former government employees organised themselves in cooperatives to cater for the road signage business which the government was prepared to farm out. Of course, every privatisation presents its own challenges, but if the government bases its plans in a way that it achieves buy-in from all the stakeholders, the chances of success will be that much better.

The Labour Party immediately endorsed the general direction towards privatisation announced by the government. This was done at a political cost because not everyone agrees that privatisation is indeed the only reasonable last chance for the shipyards to become economically viable. The government now needs to build on this commitment by aiming for consensus on the way this privatisation is to be implemented.

We fear that the present government plan could jeopardise the success of this privatisation because it does not give sufficient importance to the need of preserving the core skills which exist in the shipyard today. To obviate this risk, the government plan needs to take in consideration the genuine concern of workers who want to know what their work prospects will be if they decide to stay on and work for the new operators.

The new operators, should tailor their plans on local realities. One of these realities is that, despite all its weaknesses, the Maltese shipyards industry has a pool of highly skilled human resources that should be used not only to optimise productive employment, but to preserve a highly skilled workforce.

Dr Mangion is leader of the opposition.