Anorak alert!....but leading somewhere...

'Sailing' - not by Rod Stewart indeed!
Words and music were by Gavin Sutherland from the Sutherland Brothers - who toured and recorded extensively for a good while teaming up with the band 'Quiver' - whose guitarist, Tim Renwick, went on to tour twice as 'second' guitar' to Dave Gilmour in Pink Floyd (anyone remember the Live at Earl's Court footage?) - and Quiver's bass player Bruce Thomas played in the 'Attractions' for Elvis Costello...

...which brings me to my nomination...
Elvis C wrote the marvellous (and surely must be earmarked 'folk') 'Shipbuilding' - as made a minor hit by ex-Soft Machine drummer Robert Wyatt.
HFA