Scottish ministers will continue funding the construction of a second ferry at Ferguson shipyard despite it being cheaper to build a new ship elsewhere.
Economy Secretary Neil Gray said yesterday that a review had found finishing the ship, known as Hull 802, did not represent value for money in "narrow" terms.
But he said completing the vessel at the nationalised yard was the fastest way of delivering more ferry capacity.
Pulling the plug would also threaten jobs and the wider economy, he added.
The BBC says Mr Gray has issued a rarely-used ministerial direction to overrule the financial test.
Two CalMac ferries were ordered in 2015 when Ferguson Marine was owned by Jim McColl, a pro-independence businessman who had rescued the Port Glasgow yard from administration a year earlier.
Massively over budget
The build soon ran into trouble - and the ships are now more than £200million over budget and six years late.
Mr McColl and the government-owned ferry-procurement agency CMAL blame each other for the problems.
The current boss of the shipyard - which was nationalised in 2019 - now expects the first ship, Glen Sannox, to be delivered this autumn, followed by the as-yet unnamed Hull 802 in the late summer of 2024.
Mr Gray told MSPs that a "due diligence" review of requests for additional funding had found that completing Glen Sannox at the yard was the "cheapest option open to ministers".
But he continued: "The case for vessel 802 is more challenging - and I have accepted the judgement of the Scottish Government accountable officer that the narrow value for money case has not been made."
The minister, however, said it was important to look at wider considerations including the impact on the shipyard, the wider community and national resilience.
'Utmost importance'
"These are not matters that can be taken into account in a pure value for money exercise, but clearly they are matters of the utmost importance," he said.
While the value-for-money assessment had concluded it could be cheaper to procure a new ferry elsewhere, that would lead to significant delays, as it could not be deployed before at least May 2027, he said.
"I do not consider it acceptable for our island communities to wait this further period," he said.
Mr Gray told MSPs he could not rule out further increases in costs for the two ferries because the shipyard was facing inflationary pressures and was still discovering "design gaps", some of which dated back many years.
Scottish Labour MSP Alex Rowley said what was missing from Mr Gray's statement was an apology.
'Outrageous mismanagement'
"An apology to the islanders who have been so badly let down, an apology to the workers at Ferguson who have been so badly let down - and ultimately an apology to the people of Scotland for outrageous mismanagement of public funds," he said.
For the Scottish Conservatives, Graham Simpson said: "The building of ferries 801 and 802 has been a shambles from start to finish.
"In fact, shambles is not a strong enough word. It has been a scandal."