Ferry firms given post-Brexit freight contracts worth £77.6m

Four ferry companies have been given contracts from the government worth more than £70m to provide freight capacity after Brexit.

The Department for Transport has signed deals with Brittany Ferries, DFDS, P&O Ferries and Stena Line totalling £77.6m.

It said the agreements will ensure that vital medical supplies and other critical goods “continue to be smoothly delivered into the UK whatever the outcome of negotiations with the EU”.

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The contracts will be in place for six months from the end of the transition period on 31 December.

Transport Secretary Grant Shapps said: “As the transition period comes to an end, we are putting the necessary measures in place to safeguard the smooth and successful flow of freight.

“Securing these contracts ensures that irrespective of the outcome of the negotiations, life-saving medical supplies and other critical goods can continue to enter the UK from the moment we leave the EU.”

The issue of post-Brexit freight capacity has proved controversial in the past.

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Mr Shapps’ predecessor Chris Grayling came under pressure to resign after giving a contract worth £14m to Seaborne Freight, despite the fact that the firm had no ships.

Naomi Smith, chief executive of the Best for Britain campaign group, said: “Given the government’s last ferry contracts ended in a court battle, many will rightly question whether this is the best way to ensure vital medical supplies and other critical goods can be smoothly delivered to the UK after the transition period ends.

“Supply chains are already experiencing unprecedented levels of disruption due to COVID and a no-deal Brexit could create huge new logistical problems for medicine suppliers and those relying on them, particularly given how late these arrangements have been made.”

Chris Grayling

Image: Chris Grayling came under pressure to resign after giving a contract worth £14m to a firm that had no ships

According to the DfT, the deals secure freight capacity on nine routes serving eight English ports “in areas less likely to experience disruption”: Felixstowe, Harwich, Hull, Newhaven, Poole, Portsmouth, Teesport and Tilbury.

The government used its freight capacity framework to award the contracts, which entails a shortlist of “experienced freight operators” submitting bids.

Should the capacity not be needed, the DfT said the termination costs would “reflect a fraction of the full contract amount”.

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With the end of the Brexit transition period looming, there are fears of delays to cross-Channel trade at major ports like Dover and Folkestone in 2021.

The government says it “continues to work with key local stakeholders and industry to prepare for the end of the transition period”.