The UK Government has signed contracts with four ferry companies to ensure that freight will continue to flow in 2021, following Brexit.
The Brexit transition period ends on 31st December.
The UK Department of Transportation announced that it had signed six-month contracts with Brittany Ferries, DFDS, P&O Ferries, and Stena Line valued at more than $100 mill.
Should the contracts not be required, the termination costs would be an unspecified fraction of the full contract amount, the department said.
This had become a major point of contention the last time the UK contracted for a post Brexit ferry service.
The contracts will focus on nine routes serving eight ports in areas the Department of Transportation claimed were less likely to experience disruption.
Ports named in the contacts were Felixstowe, Harwich, Hull, Newhaven, Poole, Portsmouth, Teesport, and Tilbury. The routes serving Dover and Folkestone were considered vital for trade between the UK and the EU.
“As the transition period comes to an end, we’re putting the necessary measures in place to safeguard the smooth and successful flow of freight,” said Transport Secretary, Grant Shapps, in announcing the contracts. “Securing these contracts ensures that irrespective of the outcome of the negotiations, lifesaving medical supplies and other critical goods can continue to enter the UK from the moment we leave the EU.”
At the end of 2018, the UK Government entered into similar contracts with DFDS, Brittany Ferries, and Seaborne Freight to prepare for a possible ‘no-deal Brexit.’
The previous contracts valued at $140 mill were designed to prepare for potential shipping bottlenecks at Portsmouth, Plymouth, Ramsgate, and Poole.
At the time, Seaborne Freight was allocated 15% of the contract despite the fact the company had no vessel and no experience operating a freight ferry service. It has since been declared bankrupt. The contracts were ultimately cancelled.
For this round of contracts, the government said that it used the 2019 framework, which was designed to improve the flow of goods. All of the contracts have now gone to experienced operators.
Responding to the news, seafarers’ Union RMT’s General Secretary, Mick Cash, said: “It is not enough that these companies actually own ships, these contracts must guarantee British seafarer employment. We will not stand for taxpayers’ money being used to subsidise ferry companies that recruit crew from outside the UK so they can pay them less, including rates below the (UK) national minimum wage.
“These international routes are critical to our economic future, yet P&O are walking away from Hull-Zeebrugge and over 1,200 UK seafarers have lost their jobs since the start of the pandemic.
“Support to ferry operators to cover for the Government’s bungled Brexit must be on the condition that seafarer jobs in our coastal communities are protected.
“RMT calls on the Government to ensure that these basic protections for British seafarers’ jobs are in place on these contracts and on any future contracts signed under the Freight Capacity Framework Agreement,” he said.
*****The second P&O ferry recently laid up at Leith, ‘Pride of Burgundy’ sailed on 24th October for Dover. She has been reportedly put up for sale.