Government pays Eurotunnel £33m over Brexit ferry case

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The government will pay £33m to Eurotunnel in an agreement to settle a lawsuit over extra ferry services in the event of a no-deal Brexit.

In December, the Department for Transport (DfT) contracted three suppliers to provide additional freight capacity for lorries.

Eurotunnel said the contracts were handed out in a “secretive” way.

As part of the agreement, Eurotunnel has agreed to make some improvements to its terminal.

One of the firms awarded a contract, Seaborne Freight, has already had its deal cancelled after the Irish company backing it pulled out.

Shortly after it was awarded the contract, the BBC found out that Seaborne had no ships and had never run a ferry service.

‘Smooth supply’

Transport Secretary Chris Grayling has been heavily criticised for the Seaborne deal, which would have been worth £13.8m.

In January, Eurotunnel wrote to Mr Grayling to complain that it had not been considered when the contracts were awarded.

It argued that unlike Seaborne, it has actually run a cross-Channel ferry service (MyFerryLink, which closed in 2015) and should have been approached.

In a statement accompanying the agreement, Transport Secretary Chris Grayling said: “While it is disappointing that Eurotunnel chose to take legal action on contracts in place to ensure the smooth supply of vital medicines, I am pleased that this agreement will ensure the Channel Tunnel is ready for a post-Brexit world.”