PAC calls on government to speed up Brexit preparations

11 Jul 19

Preparations for Brexit are not happening quickly enough despite the EU granting the UK and extended deadline, MPs have warned.

The Public Accounts Committee has urged the government to “urgently step up” preparations to avoid another rushed and costly incident like its flawed ferry freight contract.

Procurement mistakes over a post-Brexit ferry contract cost the taxpayer around £85m - £51.4m in cancelled contracts and £33m in an out of court settlement and the government must avoid repeating these mistakes, the PAC said.

PAC chair Meg Hillier said on Wednesday: “In just four months’ time, on 31 October, 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 report added that there is a “real risk” that the short time left before the UK’s next deadline will cause more high-risk and high-cost procurements.

The Department for Transport suggested it would take a minimum of three months to set up new ferry contracts and so the committee said any new procurement process “would need to begin very soon”.

Transport secretary Chris Grayling came under fire earlier in the year for a £33m out of court settlement paid to Eurotunnel after the company complained the procurement process was done in a “secretive” way.

The contract – given to Seaborne Freight to provide no deal cargo services – was cancelled after the extension of the Brexit deadline from March 2019 to October.

As part of the settlement Eurotunnel has an obligation to invest in infrastructure projects at the channel tunnel site and that all investments show a public value.

“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,” said Hillier.

A DfT spokesperson said: “The freight capacity contracts were taken out as an insurance policy for the UK to ensure that key medical supplies could be guaranteed in the event of a no-deal Brexit. 

“Two weeks ago the department outlined a new framework proposal to provide a list of operators capable of delivering this vital freight capacity without the government committing to any agreements at this stage, with market engagement already underway.” 

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