Government cancels Brexit ferry contract with no-ship firm

A controversial no-deal ferry contract awarded to a firm with no ships has been cancelled by the Department for Transport after an Irish shipping firm that had been secretly backing the deal pulled out.

The decision by the secretary, Chris Grayling, to award Seaborne Freight a contract worth £13.8m had attracted widespread criticism and ridicule.

It was one of three firms awarded contracts totalling £108m in late December to lay on additional crossings from Ramsgate to ease the pressure on Dover when Britain leaves the EU, despite the company having never run a Channel service.

The department said on Friday it had decided to terminate the contract after Arklow Shipping, which had backed Seaborne Freight, stepped away from the deal.

A DfT spokeswoman said: “Following the decision of Seaborne Freight’s backer, Arklow Shipping, to step back from the deal, it became clear Seaborne would not reach its contractual requirements with the government. We have therefore decided to terminate our agreement.

“The government is already in advanced talks with a number of companies to secure additional freight capacity – including through the port of Ramsgate – in the event of a no-deal Brexit.”

The contract was cancelled a day after Grayling contacted Thanet district council to ask it to postpone a budget that would have shut down parts of the port of Ramsgate for use by freight shipping.

Keeping the site open is costing local taxpayers £7,224 a day, according to a local source, and the council – which has already spent months in fruitless negotiations with Seaborne – had proposed shutting it down to help balance the books.

The DfT persuaded the council to keep it open, claiming that talks with Seaborne were at an “advanced stage”, according to Paul Messenger, a local Conservative councillor.

He said the port was costing about £2m a year: “That’s why we haven’t got any road sweepers, that’s why we haven’t got any public lavatories.”

Questions remain about the viability of Ramsgate’s port for use post-Brexit. It can only accommodate ships up to 180 metres long, but modern ships are typically 230-250 metres to allow for the economies of scale that make them sustainable.

 

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