Chris Grayling has been accused of “gross incompetence” after awarding a firm with no ships a £13.8 million contract to run freight from the UK to the EU in the event of a no deal Brexit.
Shadow transport secretary Andy McDonald blasted the decision to award Seaborne Freight the contract — telling MPs it “violates every current best practice guidance issued by Whitehall”.
Seaborne was one of three firms awarded contracts totalling £108 million to lay on additional crossings to ease the pressure on Dover when Britain pulls out of the EU, despite having never run a Channel service.
Mr McDonald, who secured an urgent question in the Commons on the matter, said: “The Transport Secretary has awarded a £14 million contract to a company with no money, no ships, no track record, no employees, no ports, one telephone line and no working website or sailing schedule.”
“This is a shoddy and tawdry affair and the Secretary of State is making a complete mess of it, this contract is very likely unlawful and violates every current best practice guidance issued by Whitehall”, he said.
He added: “When will he realise that this country cannot continue to suffer the consequences of his gross incompetence? Why is this calamitous Secretary of State still in post?”
Mr Grayling said he would not “address the idiocy” of Mr McDonald’s comments, but added: “This Government has let a contract for which we will pay no money until and unless ferries are running, that is responsible stewardship of public money.”
Mr Grayling said a review of the firm had been carried out by his department and “nothing that would prevent them from contracting with Government” was found.
He said: “I make no apology for being willing to contract with a new British company, we contracted with Seaborne Freight as the service they propose represents a sensible contingency in the event of disruption on other routes.”
Seaborne aims to operate freight ferries from Ramsgate in Kent to the Belgian port of Ostend, beginning with two ships in late March and increasing to four by the end of the summer.
It was established two years ago and has been in negotiations about running freight ferries between Ramsgate and Ostend, but no services are currently running.
Narrow berths in the port mean there are few suitable commercial vessels available.
Conservative Sir Bernard Jenkin, chairman of the Public Administration and Constitutional Affairs Committee, suggested a “quick lessons learned” review should be conducted by the department’s permanent secretary to ensure companies are “better prepared” for the scale of scrutiny they could be subjected to.
Mr Grayling replied that the contract was “properly passed through and signed off” by his department’s accounting officer.
Lilian Greenwood, Labour chairwoman of the Transport Committee, raised questions about Seaborne Freight’s “secret ships” and over how the service will be delivered.
Mr Grayling later claimed Labour “simply hate business” over its response to the Government agreeing a contract with a small firm.
But Diana Johnson, Labour MP for Kingston upon Hull North, accused Mr Grayling of “bluster and bluff” before adding: “Can he just say to me that everything he’s heard today from the frontbench and from the chair of the Transport Select Committee, does he not have one iota of concern about this contract being let to this shyster?”
Mr Grayling replied: “That is an inappropriate thing for any member to say and I’m not going to respond to it.”
SNP MP Angus MacNeil (Na h-Eileanan an Iar) said: “It feels daily that we’re in a film called Carry On Brexit.”
Labour’s Alex Sobel (Leeds North West) claimed Seaborne Freight tried to “get an option to purchase” four ships which “all operate in the southern Mediterranean and would need a complete refit to be able to operate in the Channel”.