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Failing Grayling ferry fiasco returns as P&O sues over £33m bill

Failing Grayling ferry fiasco returns as P&O sues the government for ‘unlawfully handing £33m of taxpayers’ money to rival Eurotunnel’

  • Chris Grayling was branded an ‘international embarrassment’ over £33m deal 
  • Eurotunnel sued after being excluded from £108m No Deal Brexit planning 
  • Contract was handed to Ramsgate’s Seaborne Freight – who had no ferries
  • P&O heading to court claiming that £33m to Eurotunnel is illegal state aid 

Transport secretary Chris Grayling, pictured, has faced a string of scandals and wanted to hold back an announcement on a new rail delay last year, emails have revealed

Chris Grayling’s headache over a £33million bill to settle a lawsuit over bungled Brexit ferry contracts is back today after P&O launched its own legal challenge against the Government.

The Dover ferry giant believes the huge chunk of taxpayers’ cash handed to its cross-Channel rival should be classed as illegal state aid – and will go to court to prove it.

Eurotunnel agreed a £33million settlement to drop its claim over the ‘secretive’ way the Government awarded lucrative deals for ferry companies to run extra crossings in case of a No Deal.

Transport Secretary Mr Grayling faced more resignation calls having already been left red-faced after the collapse of a £13.8million contract with one ferry firm, Seaborne Freight, after it emerged that it had no ships.

His allies insisted it was ‘unfair’ to single him out for criticism as the contract had been decided on a ‘cross-government’ basis – but Labour and other begged to differ, calling him an ‘international embarrassment’.

Now P&O says the £33million paid to Eurotunnel to make improvements to its terminal put its business at a ‘competitive disadvantage’. If it wins the case Eurotunnel may have to hand some or all of it back.

A spokesman confirmed they are taking legal action and said: ‘We also fully accept that it was prudent of the government to make contingency plans to protect international supply chains in the event of a hard Brexit.

‘However, we do not believe that the payment of £33m of public money to Eurotunnel to settle its legal challenge to these plans is fair or reasonable.

‘It is explicitly designed to be invested in the tunnel’s infrastructure and if left unchallenged would put our services at a competitive disadvantage.’

The contract with Seaborne Freight to provide extra ferries in the case of a No Deal Brexit was eventually cancelled (pictured is the Port of Ramsgate)

The contract with Seaborne Freight to provide extra ferries in the case of a No Deal Brexit was eventually cancelled (pictured is the Port of Ramsgate)

A government spokesman said: ‘We are confident we acted appropriately in reaching the agreement with Eurotunnel.’     

Famous Chris Grayling bungles 

Banning books for prisoners

The controversial ban on parcels of books being sent to prisoners was condemned as ‘unenlightened’ when then Justice Secretary Chris Grayling introduced it in 2013.

He claimed parcels being sent into prisons had been a vehicle for ‘contraband’ and there were not enough staff to check them all properly.

Mr Grayling insisted prisoners could access books from jail libraries and could purchase more using money earned by working inside.

He was removed as Justice Secretary when the all-Tory government was formed in May this year, with Michael Gove – a former Education Secretary – taking his job.

Seaborne Freight

Mr Grayling’s decision to award Seaborne Freight a contract worth £13.8 million to run services between Ramsgate and Ostend – despite having no ships – attracted widespread criticism.

The DfT’s decision was challenged by Eurotunnel, and on Friday the Government announced it had reached an agreement worth up to £33 million with the Channel Tunnel firm.  

Rail timetable chaos

Mr Grayling faced a vote of no confidence – but survived – over Northern Rail’s chaotic timetable collapse in June. Up to 770 trains were cancelled per day.

He had rejected calls for Northern to be renationalised, although he accepted the situation experienced by passengers was ‘unacceptable’.

In a later appearance before the Commons Transport Select Committee, he raised eyebrows by insisting: ‘I don’t run the railways,’ and instead blamed Network Rail.

Late last year, the Government awarded contracts worth £108million to three suppliers for extra freight capacity so vital supplies could still reach the UK in a No Deal Brexit.

But in February, the Department for Transport was ridiculed after it terminated the deal with Seaborne Freight. Eurotunnel accused ministers of a ‘distortionary and anti-competitive’ tendering process and claimed it was given no chance to compete.

Hours before the case was due to start, the Government said it had paid the firm £33million to settle out of court. 

Mr Grayling put a positive spin on the deal, saying it would ensure the Channel Tunnel is ‘ready for a post-Brexit world’. 

The Transport Secretary has faced a string of scandals in the past year where critics accused him of ‘gross incompetence’.

He faced calls to resign in February after handing a £13.8million contract to a ferry company with no ships in the event of a No Deal Brexit.

In December he was accused of failing to ‘get a grip’ on the drone crisis that shut down Gatwick Airport for three days as tens of thousands of passengers tried to get away for Christmas.

And he kept his job despite criticism of his handling of the Thameslink and Northern Rail timetable crisis last year, which saw 770 trains a day cancelled, earning him the nickname ‘failing Grayling’ because of the chaos.  

This week it was revealed the under-pressure Transport Secretary ordered officials to hold-off on announcing delays to a major rail project so he could avoid criticism from MPs.

Leaked emails suggest Mr Grayling wanted the announcement to be delayed by 24 hours to dodge a grilling in the Commons.

In January last year Network Rail bosses informed him that a multi-million pound electrification scheme in the North West of England would not be completed on time. 

This email leaked to the Yorkshire Post says the SoS - a reference to Mr Grayling - said the announcement should be made soon - 'but not before' a debate in Parliament where he would be grilled by MPs

This email leaked to the Yorkshire Post says the SoS – a reference to Mr Grayling – said the announcement should be made soon – ‘but not before’ a debate in Parliament where he would be grilled by MPs

An email from an unnamed senior official at the Department for Transport said Mr Grayling ‘would prefer the announcement were sooner rather than later but not before the Opposition Day debate on Rail tomorrow.’

They suggested the announcement was ‘best choreographed’ for Thursday, January 11 – and news the line upgrade between Preston and Manchester would be delayed was broken that day.

Labour’s transport spokesman Andy McDonald accused Mr Grayling of ‘contempt for the House of Commons’ after the emails were uncovered by the Yorkshire Post. 

Grayling’s ferry failure: How the cross-channel no-deal Brexit plan descended into farce

 Chris Grayling has been widely attacked over his December decision to award ferry contracts to cover the possibility of a no-deal Brexit causing problems at the UK’s borders:

  • December 22: Department for Transport awards contracts worth £108 million to DFDS, Brittany Ferries and Seaborne Freight to lay on additional crossings to ports other than Dover in a no-deal Brexit.
  • December 29; The news is revealed and the DfT says there was no time to put them out to tender.
  • December 30: It is revealed that Seaborne Freight had been given a contract worth £13.8 million but owned no ships.
  • January 2: Mr Grayling defended the decision as ‘supporting new businesses’. He insisted he had checked Seaborne Freight would be able to deliver goods between Kent and Belgium if needed in a no-deal scenario.
  • January 3; It was alleged the firm’s website copied its terms and conditions from a takeaway shop, with a long run of small print that featured a section about ‘placing an order’ that placed an obligation on a customer to check their ‘meal’. It was later deleted.
  • January 9: It was revealed Seaborne would not be ready to begin services until April, missing Brexit day on March 29.
  • February 10: The contract with Seaborne is officially cancelled after it backers, Arklow Shipping, pulled out. The Government says no money changed hands.
  • February 11: Eurotunnel launched a legal case against the DfT over the way the contracts were handed out to ferry firms.
  • March 1: The Government agrees a £33 million deal with Eurotunnel and the firm drops the legal case. 
  • April 26: