The rushed, botched procurement of ferry services for a no-deal Brexit which cost the taxpayer nearly £85m could be repeated unless Whitehall urgently steps up contingency preparations for a 31 October withdrawal, MPs have warned.
A critical report from the public accounts committee said the Department for Transport took “excessive risks”, resulting in a £33m payment to Eurotunnel to settle legal action, on top of the £51.4m paid to cancel its ferry contracts when the Brexit deadline was extended.
The committee also dismissed DfT claims that the payment to Eurotunnel, which sued after being excluded from the procurement process, would secure any public value. It said promises to spend the payoff in border and security infrastructure at the Channel Tunnel was “window dressing” and that Eurotunnel would have invested at least that amount of money, irrespective of the settlement.
The transport secretary, Chris Grayling, has faced widespread calls for his resignation over the ferry fiasco, which included the award of contracts to Seaborne Freight, a company with no ships, and led to yet further legal action from P&O, which objected to the money paid to its competitor Eurotunnel. Two contracts to ensure ferry space for essential supplies in the event of holdups at Dover after Brexit were signed with DFDS and Brittany Ferries, and scrapped in May without the services having been used.
While the Conservative contenders to succeed Theresa May as prime minister have signalled they would be prepared to lead Britain out of Europe without a deal, the MPs warned that momentum was slowing in Whitehall, adding: “We remain concerned that departments’ preparations are being left too late. The window for decision-making for any departure on 31 October is short and key deadlines for decisions are passing every day.”
The committee called on the government to ensure that departments urgently stepped up their preparations on the assumption the UK would leave the EU on deadline. It said that, according to the Cabinet Office, a fresh decision on ferry procurement was needed imminently. But the MPs warned: “There is a real risk that the short time left will force [the DfT] into further high-risk procurements.”
Meg Hillier, the Labour chair of the committee, said: “In just four months’ time, the UK is expected to leave the EU yet momentum appears to have slowed in Whitehall. Departments must urgently step up their preparations and ensure that the country is ready.
“The taxpayer has been landed with a £85m bill with very little to show for it following the rushed procurement of ferry freight capacity.
“Public benefits from the settlement with Eurotunnel amount to little more than window dressing. The department needs to keep a close eye and ensure that Eurotunnel deliver what is promised.”
