Air Services to the EU
Lord Grayling Excerpts(5 years, 8 months ago)
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The Secretary of State for Transport (Chris Grayling)
Leaving the EU with a deal remains the Government’s top priority. This has not changed. However, a responsible Government must plan for every eventuality, including a no-deal scenario.
In December, Cabinet agreed to proceed with the Government’s next phase of no-deal planning. This means we are setting in motion our remaining no-deal plans.
Both the EU and the UK have been clear that they are committed to maintaining air services in any scenario. Aviation links are a key priority for the Department for Transport. The UK has the third largest aviation network in the world, and the biggest in Europe. Air travel is vital for both the UK and the EU in connecting people and businesses, facilitating tourism and trade. The UK and EU have a mutual interest in maintaining well-functioning aviation markets.
The Government have made preparations to deliver continuity of air services between the UK and the EU in the event that the UK leaves the EU without a withdrawal agreement. We set out in our technical notices in September 2018 that the UK would take a pragmatic approach to any no-deal scenario, and provide EU airlines with permission to operate. We expected EU countries to reciprocate and provide permissions to UK airlines.
Following this, the European Commission proposed a regulation to ensure air connectivity in the event that the UK leaves without a withdrawal agreement. A final version of the draft regulation has been provisionally agreed by the EU. This is expected to be confirmed by the Council and the European Parliament shortly. The provisionally agreed EU regulation is intended to apply after the UK leaves the EU, and would entitle UK airlines to continue operating air services from the UK to the EU until March 2020.
Accordingly, I am today publishing a policy statement to set out how the UK intends to provide the necessary permissions to member state airlines in order for them to operate to the UK. We have made all decisions in relation to how the UK will reciprocate based on three key principles. First, we want to provide certainty and reassurance to industry and consumers. Secondly, we want to minimise the potential for disruption. Finally, we want to maintain a level playing field for UK industry, ahead of future negotiations.
Full details on how the UK will reciprocate are set out in the policy statement. In short, for the 12 month duration of the EU regulation, the UK intends to reciprocate the rights provided in the EU’s regulation, and grant EU air carriers a level of access to the UK at least equivalent to the rights that would be granted to UK airlines under the regulation. This includes traffic rights, ownership and control, leasing of aircraft, co-operative marketing arrangements and fair competition. As an exceptional measure to ensure the continuity of regional services and to minimise disruption, we will for a short period go further and allow member state airlines to operate wholly within the UK for the IATA summer season 2019, which ends on 27 October 2019, ensuring continued regional connectivity and providing time for EU businesses to adjust to new arrangements. We will also allow code sharing on existing services to continue.
While continuing to plan for all eventualities, we also believe that it is right to underline the fact that the UK is taking a positive and pragmatic approach. Overall, we continue to believe that liberal, reciprocal market access is in the best interest of the EU countries and the UK, and we will move swiftly to propose negotiations on this basis in the event that the UK leaves without a withdrawal agreement.
[HCWS1384]
EU Exit Preparations: Ferry Contracts
Lord Grayling Excerpts(5 years, 8 months ago)
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Alan Brown
I thank the hon. Lady for highlighting yet another miserable failure, with more money being thrown down the drain. It is interesting that Eurotunnel was paid £33 million for vital services, given that that seems in one way or another to replace the contract of Seaborne Freight, which was given only £14 million. So we really do have to ask what extra we are getting for the £33 million, or is this all the compensation that Eurotunnel walks away with and the taxpayer has no chance of recouping? Again, the Transport Secretary really needs to explain this.
The Government have argued that direct negotiation was possible under regulation 32 of the Public Contracts Regulations 2015, which relates to emergency situations brought about by unforeseeable events. So, after more than two years of no-deal planning, we suddenly had an unforeseen event—an unforeseen event, however, that allowed such protracted negotiations and £800,000-worth of due diligence. I would like the Transport Secretary to explain how long those negotiations were ongoing in this supposedly emergency situation, because £800,000 of consultants’ money amounts to a fair bit of time in negotiation, so he needs to explain when the actual emergency situation kicked in.
The argument from the Dispatch Box was that Seaborne Freight would only receive the money if it delivered the service, but that misses the point, because if it did not deliver the service, the emergency service it was contracted for would not happen, and that would leave the Government in a right mess in terms of no-deal preparations. The Transport Secretary has also argued that Seaborne has not cost the taxpayer any money. Hopefully he will re-explain these figures, because I would like to know how £800,000-worth of due diligence, at least some of which was on Seaborne Freight, has not cost any money. How did going to court and defending the Government’s position not cost any money? How did an out-of-court settlement with Eurotunnel at £33 million not cost any money that was related to Seaborne, because I am pretty sure a key plank of Eurotunnel’s objections was the fact that the Transport Secretary gave an important contract to a company with no ships? Meanwhile Eurotunnel is a company that obviously provides successful cross-border services. It is no wonder it was at court.
I would also like to ask the Transport Secretary whether there are any more objections outstanding: any more risks of court action. In response to a written parliamentary question I was told that a limited number of representations were received. In my book, a limited number is more than one. We have already had one court case to date; are any more court cases pending?
Alan Brown
Are we absolutely sure about that? Given the Transport Secretary’s ability to count, “A hae ma doots,” as they say.
The Transport Secretary has never been able to answer what the loss of the 10% Seaborne contract would actually mean for the impact on Dover? Dover is so sensitive that even 10% would have a massive effect. We have heard about the fact that a minute and a half to two minutes of additional checks per lorry could lead to 30-mile tailbacks. Fortunately, under the Transport Secretary’s competent planning for no deal, we know that the Government have planned for at least 10,000 lorries by doing an exercise involving 89 lorries, driving up and down the motorway! [Interruption.] Yes, and the bin wagons. So 89 lorries driving up the motorway and parking up at Manston airport successfully proves that this Government can handle no-deal preparations! I am relieved; I am happy at that. I hold to my faith in the Transport Secretary.
Alan Brown
I am actually very surprised at that. I put in a written parliamentary question asking how much the Department for Transport had paid towards the dredging of the port at Ramsgate, and the answer I was given was that it had paid nothing, so I shall be challenging that further. We need to get to the bottom of this, because we know full well that that operation was not done for nothing and that the Transport Secretary was lobbying Thanet Council to keep the port open because of his negotiations with Seaborne. There is more to run on this, and I thank the shadow Secretary of State for bringing it up.
Returning briefly to Eurotunnel, we know that the out- of-court settlement was effectively a Government cave-in. The thing about that Government cave-in is that we have learned that they are going to keep 10,000 documents secret for reasons of commercial confidentiality, which will make it much harder for us to get the bottom of this. We know that they had no confidence in their own position because they settled out of court.
We also need to understand why the Health Secretary came to the Dispatch Box yesterday to tell us that this was such an important contract as it would keep medicines coming into the UK. He said that that was why the Government had negotiated the £33 million settlement with Eurotunnel. He suggested that it was not about compensation but about vital services and improvements. I repeat that we need clarity on this. If that £33 million was related to the provision of vital services, why did Eurotunnel take the Government to court? Why was Eurotunnel not identified as a reputable provider before, when the Government were looking at Seaborne Freight? How much of that £33 million compensation for Eurotunnel has gone forever? What services are we going to see? What updates will the House be given on the progress of those vital services that the Government have procured?
The Transport Secretary has been lax on updating the House from start to finish. We had one ministerial statement at the outset, which he thought would head off the bad press about Seaborne Freight. We have subsequently had to table three urgent questions, and we are now having this emergency debate. And of course, he has sometimes not even turned up to the Dispatch Box. The fact that he is unwilling to come to the Dispatch Box, state his case clearly and leave himself open to questions from Members says everything about his confidence in his own competence.
A procurement matter that I touched on yesterday is that it looks as though Bechtel is going to sue the Government over the HS2 tendering process, so will the Secretary of State identify what other departmental risks exist in relation to procurement? What review of the procurement process has he instigated? Who is heading up the review and when will it report on this matter? It is quite clear that some sort of procurement review is absolutely vital.
I will finish by again describing the Transport Secretary’s litany of failures. We heard about the near £600 million cost of privatising the probation service following his time at the Ministry of Justice.
Chris Grayling
Will the hon. Gentleman confirm to the House that the probation service contracts are running around £1 billion under budget?
Alan Brown
I cannot confirm that. The right hon. Gentleman is quite comfortable with his legacy there, so I will leave that to him; what he said is on the record. No one else seems to appreciate his legacy, including the current Justice Minister, who is trying to deal with the mess.
The Secretary of State for Transport (Chris Grayling)
As I have explained to the House on several occasions, the Government entered into contracts with ferry operators to provide additional ferry capacity and services into the UK as part of no-deal contingency planning. However, as we have heard clearly this afternoon, the reality is that the SNP does not believe in preparing for no deal. Even though the hon. Member for Kilmarnock and Loudoun (Alan Brown) accepts that it is a possibility, a risk and a danger, he does not support us in preparing for the risk of a no-deal exit—[Interruption.] The Labour Front-Bench team say, “Take it off the table,” but we can only take no deal off the table by reversing Brexit or agreeing a deal. The reality is that Labour and the SNP have spent week after week trying to prevent a deal, voting against the deal and trying to disrupt the process of getting towards a deal. Frankly, they are acting in anything but the national interest in doing so. We, however, have been acting in the national interest in preparing for all eventualities.
Wayne David (Caerphilly) (Lab)
If the Secretary of State really believes that no deal should be an option, why on earth did the Government not begin preparations sooner?
Chris Grayling
We have been preparing for a no-deal exit for months and months. There was a particular reason, as I will set out in a moment, for this particular procurement at this particular time, but my Department has been working for months to prepare for the risk of no deal. That can be seen in the new international aviation agreements, in Kent, where we have put in alternative resilience systems to the deeply disruptive Operation Stack, and in many other things.
Julian Knight (Solihull) (Con)
It is not just here that we see the Opposition parties not acting in the national interest, because the same applies to statutory instruments. It is a constant refrain. Does my right hon. Friend agree that the only way of taking no deal off the table is by voting for the Prime Minister’s deal? It is time for the Opposition parties to put narrow party politics aside.
Chris Grayling
Absolutely. All that we have heard for months is, “Why are the Government getting this wrong?” but we have had no tangible or realistic plans from the Opposition. At every opportunity, they simply work to disrupt the Brexit process. Labour stood on a manifesto that respected the referendum result, but the party is doing anything but respecting the result. If it continues to disrupt the Brexit process, it will pay a heavy price in its heartlands, where people voted for Brexit.
Charlie Elphicke
I have been reading the NAO report with considerable interest, and it says:
“Over the summer of 2018, government departments stepped up their contingency preparations for no deal.”
The truth of the matter is that Government policy changed in summer 2018 to step up contingency planning, so the Department for Transport acted from that point onwards because wider Government policy had changed from that point onwards.
Chris Grayling
My hon. Friend is absolutely right, although I must say that we started some of our planning well before then. However, it is certainly the case that last summer, as we saw the progress in the negotiations, the Government stepped up their preparations for no deal, as any responsible Government should. It is quite extraordinary that the Labour party seems to believe that we can just wave a wand and take no deal off the table. We have voted to leave the European Union, and we will either leave the European Union with a deal or without a deal, or we will reverse Brexit. Those are the only three options.
Mr Francois
It is right that Government did indeed step up their no-deal preparations, as my right hon. Friend has quite rightly told the House, but one of the points of debate has been the speed at which the Chancellor of the Exchequer has been prepared to release funding to individual Departments to facilitate those preparations. Does my right hon. Friend think it would be helpful in future if the Chancellor were to lean forward a bit more to ensure that all preparations are fully funded in good time?
Chris Grayling
I will leave my right hon. Friend to make his point, because I do not want to start debating discussions within the Government.
The hon. Member for Kilmarnock and Loudoun asked why we started this procurement when we did. As I have said, we and the national health service had been preparing for disruption at the ports lasting approximately six weeks after exit day. However, based on the negotiations, on comments coming from Brussels and on what we saw happening on the other side of the channel, the analysts changed that assumption late last autumn and recommended that Government prepare for a longer period of disruption.
At that point, the Department of Health and Social Care rightly highlighted the fact that that would put significant pressures on their stockpiles of drugs. The Government therefore collectively decided following discussions in Cabinet Committees to go to the ferry industry to secure capacity to guarantee the delivery of drugs to this country in the event of a no-deal Brexit. That was a collective decision, and it was the right decision. We talked to all the current ferry operators working across the North sea and the English channel, plus any other operator with tangible plans to do so. That is where the procurement came from.
David Hanson (Delyn) (Lab)
Is this not the key question, however? Did the right hon. Gentleman have advice from his officials that negotiations solely with ferry companies would result in a legal challenge by Eurotunnel, which ultimately he has now paid off with a £33 million investment from taxpayers?
Chris Grayling
We knew, in accelerating the procurement process, that there was a legal risk. That has been highlighted in the NAO report. However, it was my judgment, the judgment of my accounting officer and the judgment of those who vetted the plan across the Government that that was a risk that we should take, given the need to ensure that we had a supply of drugs into the country in the event of a no-deal Brexit.
David Hanson
The right hon. Gentleman has said that there was a legal judgment that there was an element of risk. He took that risk, and his actions have therefore cost the state £33 million.
Chris Grayling
We took a collective decision, in the light of the legal advice, which was taken by me, by my accounting officer, and by those who approved this across the Government, and we did so—[Interruption.] We did so because we judged it important to ensure that we had a proper supply of drugs to the NHS in the event of a no-deal Brexit. I challenge Labour Members, as they chunter from the Front Bench, to say that they disagree with ensuring a supply of drugs to the UK in a no-deal Brexit.
Peter Kyle (Hove) (Lab)
I have been listening very intently to what the right hon. Gentleman has been saying. The thing that really surprises and shocks me is the fact that there is a complete lack of humility with regard to the fact that £33 million of public money—taxpayers’ money—has been wasted. Could he just stand up and say sorry to them?
Chris Grayling
I very much regret the fact that we were taken to court. It was a risk that we acknowledged was there, but I stand by the decision to make sure that we could guarantee the supply of drugs to the NHS in the event of a no-deal Brexit.
Dr Caroline Johnson (Sleaford and North Hykeham) (Con)
Does my right hon. Friend agree that proper preparation is an important role of the Government, and that frightening people unnecessarily, particularly those who are vulnerable and dependent on medicines, such as those with epilepsy, is completely irresponsible and unkind? Can he confirm to my constituents that the medicines will be available, regardless of whether we have no deal or Brexit on the Prime Minister’s deal?
Chris Grayling
I can absolutely confirm that, and I think it is absolutely right and proper that we took the steps necessary to ensure that continuity of supply. We did so with a collective decision across the Government, taken by Cabinet Committees.
Andy McDonald
Does the Secretary of State not understand and accept that today he is laying bare the advice that he received—and that he acted in contravention of that advice and he lost? We are not asking for an absence of preparation for contingencies; we are asking for a modicum of competence, and he has singularly failed.
Chris Grayling
We did not receive legal advice saying, “Do not do this.” We received legal advice saying that there was a risk in taking the approach, and we judged collectively across the Government that it was a necessary risk to take in the national interest.
Chris Grayling
I am going to make a bit of progress, because I have given way many times.
Let me touch briefly on the issue of Seaborne Freight, which was raised exhaustively by the hon. Member for Kilmarnock and Loudoun, and on which I have answered question after question in the House. First, to be clear, the agreement with Eurotunnel was not about the contract with Seaborne Freight; it was about the procurement process, and particularly about the continuing contracts we have with Brittany Ferries and DFDS for additional ferry capacity into the UK, to provide us with resilience. I have spoken exhaustively in the House about Seaborne Freight. I am disappointed that the contract had to be terminated. I stand by the decision to give that company a chance, particularly since it was backed by Ireland’s biggest shipping firm at the time. We have, as a Government, paid no money at all to Seaborne.
The hon. Gentleman keeps asking me about spending money on due diligence. We spend money on due diligence for contracts that we do not award as well as for contracts that we do award, because rightly and properly in government due diligence is applied to a tender of any sort. That is what we did in this case, and what we do in all other situations. That, again, is the right thing to do.
So it is absolutely clear—I want to be absolutely clear—that when it comes to the Eurotunnel litigation, the settlement struck between the Government and Eurotunnel was separate to the issue of the Seaborne debate, and it was struck, I think, in a way that is designed to ensure that the taxpayer actually receives value through the addition of important facilities at the border that will smooth the flows.
Chris Grayling
It was a challenge to the procurement process, on which I said I took detailed legal advice at the time of procuring, which I and my accounting officer took into account when awarding these contracts. We expected that if a legal challenge were brought, any court determination would be brought well after Brexit and would not disrupt the process. All this, as the hon. Member for Kilmarnock and Loudoun will be aware, has already been looked at by the National Audit Office. We have invited it to take a further look, but I stand by the decisions that we took.
These decisions were not simply taken by me and by my Department; they were decisions taken collectively, in the national interest.
Joanna Cherry
Can the right hon. Gentleman confirm, just for the record, that not a single penny of the £33 million paid out to Eurotunnel will be returned in the event that there is a deal?
Chris Grayling
The deal that we have done is to pay for additional facilities at the border, to create a smoother flow at the border. That is something that we will benefit from at the borders.
Mr Speaker
I say to the hon. and learned Lady that I am chairing this debate. The hon. and learned Lady will speak in full, or otherwise, if and when she catches the eye of the Chair. Thank you.
Chris Grayling
Mr Speaker, I simply reiterate: the settlement that we have reached with Eurotunnel is going to pay for improved facilities at the border, to improve flow, to make sure that our border through the tunnel works more smoothly in future, particularly in the post-Brexit world. That is a simple, factual point about the settlement that has been reached.
Charlie Elphicke
I thank my right hon. Friend for giving way one more time. He knows that the port of Dover could see the legal risk of the process that he had undertaken, but decided to act in the national interest. Will he make sure that the port of Dover is not in any way disadvantaged in relation to this matter?
Chris Grayling
I have to say that the management of the port of Dover have been exemplary for the last few weeks in co-operating with us, not only over this but in preparations for no deal. They rightly judged that it was not in their corporate reputational benefit to try to block the delivery of drugs to the NHS in a post-Brexit world. I am disappointed that not everyone took the same view.
Chris Grayling
I am going to make some progress.
I simply want to reiterate the point. We have taken the decisions. We collectively, in the Government, back in November; we collectively, a couple of weeks ago; we collectively, about this settlement, have taken the view that we need foremost to put the national interest first. We need to make sure that this country is ready for a no-deal exit, even though we are working very hard to make sure that that does not happen. We are working very hard to make sure that we are prepared for all eventualities. That is the responsible thing for the Government to do. Sometimes you have to take some risks in doing that, but I think sensible Governments take risks in the national interest. I and we and all of my colleagues who took this decision collectively, stand by this decision; we are deeply sorry that it did not work out in the way we had intended, but the reality is, it was the right decision to take, because we were putting the national interest, and particularly patients in our national health service, first—and that, Mr Speaker, you would expect any responsible Government to do.
Andy McDonald
That is a very good question, and I have raised the point myself. Those who were inquiring into the bona fides of these companies were restricted in the scope they were given. Why on earth they did not look into the track record of the individuals concerned at Seaborne is beyond me, as these things are well known. A mere cursory search of Google tells us about the track record of Ben Sharp in his dealings in the Gulf, but seemingly that was not considered. The hon. Gentleman makes the point well.
Let me return to the settlement that was achieved on 1 March. I want to know why the Department for Transport was so confident about winning the case only a week before. What brought the sudden change in strategy towards the legal challenge? The Department clearly thought it could win. Who intervened? What was the view taken by other Departments—the Department of Health and Social Care Health, the Treasury and Downing Street? Why did they take a different view from the Department for Transport? Why did the Government not settle earlier? Why did they leave it so late? Why did they continue to employ Monckton Chambers and a QC and two barristers, who do not come cheap? How much was spent on this case, both on Government legal fees and Eurotunnel’s fees? Will the Secretary of State say who made the decision to settle with Eurotunnel over the £33 million provision of emergency medical supplies in the event of no deal?
Chris Grayling
I will give a very specific answer to that question: a Cabinet Committee.
Andy McDonald
I am grateful for that clarification that it took a Cabinet Committee to make such a mess of things. Can the Secretary of State specifically say what is in this standard settlement—or are there other clauses within it? Ordinarily, when such cases are settled, they are done by reference to a consent order, in which there would be a paragraph dealing with the sum of money to be paid. In these circumstances, it may say “£33 million” and it may say the date upon which that sum is to be paid. It may also say that the costs are to follow the event. So we want to know the answers to those questions.
Andy McDonald
If the hon. Gentleman really thinks that expending £33 million when the Government did not want to or need to is a sensible way forward and a sign of success, I really do not want to see what failure looks like. That is outrageous. Saying that £33 million was the maximum amount to be paid implies that payment was conditional on particular outcomes being achieved. There is a lack of clarity on whether the Government can claw back money from Eurotunnel if it is not used on Brexit preparations. So do such provisions exist?
On that point, was the permanent secretary at the DFT correct to say of the Seaborne contract award:
“I am confident that our process was lawful, and obviously the Department and I acted on legal advice in determining how to take that process forward”?
Has the Secretary of State’s Department therefore thrown £33 million of public money down the drain by not contesting Eurotunnel in the courts? Or is it the case that because of the Prime Minister’s catastrophic Brexit negotiating tactics, which have brought us right up to the cliff edge with 24 days to go before we leave with a default no-deal Brexit, the Government’s failure to plan for such a devastating outcome has meant that they have given themselves no option but to pay out this money to Eurotunnel? Surely nothing says more about the shameful and destructive Conservative party than how, in the year 2019, a UK Government are having to make such costly decisions about prioritising medicines over food supplies. This disaster is only of the Conservatives’ own making.
The Secretary of State for Health and Social Care was wrong to claim that yesterday’s urgent question was not related to Seaborne even though the legal action was brought about in response to the award of a contract to Seaborne Freight. He did not explain why, if it was not related, as he stated, an agreement was reached with Eurotunnel now rather than in November or December. It is one way or the other.
Andy McDonald
I am happy to take an intervention. Hopefully the Secretary of State can come to the Dispatch Box and correct his human-shield colleague, because the urgent question was directly related to the Seaborne contract.
Chris Grayling
Once again, the hon. Gentleman has conveniently forgotten that 90% of these contracts for the things on which the NHS is depending are with DFDS and Brittany Ferries. I wish that at some point he would be frank with the House and explain the full gamut of what we are talking about.
Andy McDonald
That is not the first time the Secretary of State has put up this false argument, as if 10% of the goods flowing into this country through these ports and by this method are somehow irrelevant and unimportant. It is a ludicrous proposition. If damage was caused to 10% of the trade coming in, we would be in an incredibly difficult position.
Andy McDonald
No, I have already let the Secretary of State intervene on this point. [Hon. Members: “Oh!”] Come on then, get it over with!
Chris Grayling
The hon. Gentleman cannot add up. This contract brought 8% of the equivalent, in total, with DFDS and Brittany Ferries, and the contingency buffer was made up by Seaborne on the basis of buying tickets in advance that we would not pay for unless the ship sailed.
Andy McDonald
I cannot add up? I really think that is pot calling kettle. The Secretary of State has not been able to count for years; he is costing us a fortune.
Andrew Dean from law firm Clifford Chance warns that this may not be the end of the matter. Mr Dean, who used to advise the DFT and is a procurement specialist, says it is quite likely that the Eurotunnel deal will be challenged. What contingency planning has been done in relation to such a challenge, and what public funds, if any, have been allocated as part of such plans? The Secretary of State talks about having received legal advice and listened to it; perhaps he could tell the House what advice he has received about the risk of yet further satellite litigation because of the deal he has done.
The Government talk about the UK maritime industry being market-led. Is it not the case that the Secretary of State’s blundering interventions have directly undermined the industry? He promised to ensure continuity of supply for six months in the event of a no-deal Brexit. Key to that was not increasing traffic around Dover, yet the Eurotunnel/Getlink route still goes through the same bottleneck road network on either side of the channel.
The Secretary of State appears to be puzzled by the anger of the House. Allow me to explain why Members and the public are so furious: this latest fiasco would be enough to warrant the resignation of the Secretary of State even if it were an isolated incident, but it is not a one-off; rather, it is the latest costly error in a series of blunders—blunders that could have been avoided were a different, more competent Secretary of State in post.
Andy McDonald
The hon. Lady makes a valid point. An awful lot of people are looking at these eye-watering sums and thinking about what else could benefit from such interventions. That really makes my point for me: the Transport Secretary’s record is that of a departmental wrecking ball. Almost every decision he made as Secretary of State for Justice was damaging and eventually reversed, at significant cost to the taxpayer. As Secretary of State for Transport, he has repeatedly thrown our transport networks into chaos, wasting obscene amounts of public money. A £2 billion bail-out for Virgin Trains on the east coast line; his failure to prepare airports for drone attacks; his awarding of contracts to Carillion when the company was on the verge of collapse; the rail timetabling chaos; the privatisation of probation services; the banning of books from prisons—the list goes on and on.
Research into the total cost of the Secretary of State’s mistakes, both in his current role and at the Ministry of Justice, found that he has cost the taxpayer £2.7 billion. That money could have paid for the annual salaries of 118,000 nurses or 94,000 secondary school teachers. Instead, it has been squandered. He has even wasted more money than the Prime Minister offered as a Brexit bribe to towns. Shamefully, all this has been allowed by the Prime Minister, who keeps him in post because she is short of allies in the Cabinet. The country is being made to pay a heavy price for her political weakness. This would be unacceptable at any time—
Andy McDonald
The right hon. Gentleman says, “This is really poor” from a sedentary position, and I agree with him: this is really, really poor. It would be unacceptable at any time, but it is especially outrageous following the years of austerity and neglect that have left our towns and communities hollowed out and our public services in crisis.
Alan Brown
Once again, I thank you, Mr Speaker, for granting this debate. I also thank all Members who have taken part, particularly the two Conservative Members, whose contributions in trying to defend the Transport Secretary unwittingly made our case for us in terms of how big a farce this has really been. There was a ludicrous defence of the Transport Secretary by the hon. Member for Dover (Charlie Elphicke), who stated the whole Government were to blame for being too late in undertaking contingency planning. With the Transport Secretary also advising us suddenly of a collective Cabinet decision, we now know we have collective Cabinet incompetence, which says all we need to know about this Government and the leadership of the Prime Minister.
Despite having had nearly three hours of debate, the reality is that we still have no clarity about what the £33 million to Eurotunnel gets us and what, if anything, is being withheld by the Government in event of a withdrawal agreement being reached. We have had no reasons for the court climbdown on Eurotunnel’s challenge; nobody has been able to answer the questions on isotopes from my hon. Friend the Member for Glasgow North West (Carol Monaghan); and we have had no justification for how this whole procurement exercise is suddenly a medicine-led exercise. We have had no clarity or justification on the rationale for pursuing an exemption in competitive tendering on the basis of the regulation 32 exemption for unforeseeable circumstances, and no answers to the detailed questions from my hon. and learned Friend the Member for Edinburgh South West (Joanna Cherry).
Many Members have called for the Transport Secretary’s head, although, as I said earlier, it goes much wider than this. There was a classic oxymoron from the Transport Secretary: in defending his approach to the contingency planning he said that sometimes risks have to be taken. It undermines the point of contingency planning if he is actually willing to take risks. I will finish with this: the longer he stays in post is a risk too far for the United Kingdom. Again, I thank Members from across the House for their contributions.
Question put and agreed to.
Resolved,
That this House has considered the latest developments in the UK Government ferry contract awards for no-deal preparations.
Chris Grayling
On a point of order, Mr Speaker. I would just like to inform the House that the annex containing the requirements for Eurotunnel to spend money on improvements at the borders has now been published on the Government website.
Mr Speaker
That is an extremely helpful point of order from the right hon. Gentleman, and I thank him. It is by way of being a public information notice and I take it very much in that spirit.
Oral Answers to Questions
Lord Grayling Excerpts(5 years, 9 months ago)
Commons ChamberRead Full debate Read Hansard Text Read Debate Ministerial Extracts
Carol Monaghan (Glasgow North West) (SNP)
The Secretary of State for Transport (Chris Grayling)
My Department is undertaking a comprehensive and wide-ranging programme of work to ensure that we are prepared for a scenario in which the UK leaves without a deal. We continue to work to ensure that the UK does not leave without a deal.
Gavin Newlands
I am grateful for that answer, which I am not sure even those on the Government Benches will buy. The Secretary of State told the House on Monday that Arklow had confirmed its backing for Seaborne Freight “from the outset”. Yesterday the permanent secretary to the DFT told the Public Accounts Committee that the DFT had awarded Seaborne Freight the contract before Arklow confirmed its backing. Those two statements are entirely contradictory, so who is telling the truth—his permanent secretary or him?
Chris Grayling
It is very simple: the contract was conditional on Seaborne Freight producing a reference from Arklow, which it did.
Angela Crawley
The director general for the Department for Transport said yesterday that it was no longer possible to complete procurement and operation for any large amount of further capacity across the channel by either sea or rail before the end of March. The Secretary of State’s handling of this issue means that there are now no plans in place for an alternative and a 10% shortfall in capacity. How does he plan to resolve this latest disaster?
Chris Grayling
The hon. Lady clearly was not listening on Monday, when I indicated that we had options in contracts to provide additional capacity on longer sea routes to replace any that we might have had on the short sea routes.
John Mc Nally
I can assure the Secretary of State that I was absolutely listening intently on Monday. From that position over there, the Secretary of State said on Monday, in relation to Seaborne Freight, that
“we have not spent any money on this contract.”—[Official Report, 11 February 2019; Vol. 654, c. 619.]
We now know that that is not the case and that his Department spent approximately £800,000 on external consultants for Seaborne. Will he now take the opportunity to set the record straight and apologise to taxpayers for what has amounted to a monumental waste of taxpayers’ money?
Chris Grayling
I am afraid that, once again, SNP Members have their facts completely wrong. Interestingly, we have heard complaints from the other side that we did not do enough due diligence. Actually, as with all major Government contracts—Mr Speaker, you will recall that £90 million of contracts are going to Brittany Ferries and DFDS—we contract professional support when we let contracts of that size.
Marion Fellows
The Secretary of State may wish to argue that he got his £800,000-worth since the consultancy did come back with concrete findings, including that Seaborne presented “significant execution risks” and that a “basic blush test” was the most that could be carried out on the company’s financials. Which of those two findings did the Secretary of State find most reassuring when deciding to proceed with the Seaborne ferry contract?
Chris Grayling
The bit I found reassuring is that we let a contract where there was absolutely no upfront commitment from the taxpayer at all, and we paid nothing until the service was delivered.
Carol Monaghan
The Secretary of State said on Monday, “I believe in competition”, so why, after realising back in September that a no-deal Brexit would require increased freight capacity, did he embark on what has been called a
“secretive and flawed procurement process”,
tipping off some companies in private while leaving established companies, such as Eurotunnel, out of the loop altogether?
Chris Grayling
We carried out a proper procurement process in discussion with all the leading ferry operators.
Tim Loughton (East Worthing and Shoreham) (Con)
A major contributor to travel disruption over many years has of course been Govia Thameslink Railway. Its incompetence was recently underlined when a disgruntled constituent wrote to GTR, asking whom he should complain to and whether he should write to Chris Grayling. He received the reply from GTR:
“Chris Grayling no longer works for the company”.
Can the Secretary of State tell us whether a no-deal Brexit will make it easier to withdraw the franchise from GTR at long last and end this nightmare?
Chris Grayling
Happily, I have never worked for GTR. I would say to my hon. Friend that, if there are specific concerns he wants to raise about the franchise, he is very welcome to write to me. However, I am sure he is pleased that, over the last few months, the performance on that network has become significantly better.
Kevin Foster (Torbay) (Con)
I am sure the Secretary of State, like me, will reflect that it is always interesting to hear those who complain about the potential impact of a no deal then complaining about efforts to mitigate it. Will he confirm that he believes, the same as me, that the biggest potential for disruption to travel would be to put an international border across the east and west coast main lines, as the separatists opposite want to do?
Chris Grayling
Absolutely. Of course SNP Members fail to understand that their policies, if you follow European Union laws to the letter, require a hard border between Scotland and England. I have to say that I personally value the Union of the United Kingdom of Great Britain and Northern Ireland. I value our friends in Scotland, of whom we have many on the Government Benches, and I think SNP policies would be deeply damaging to Scotland.
Chris Green (Bolton West) (Con)
No matter what the outcome in terms of the delivery of the democratic decision of the British people, will my right hon. Friend confirm that the electrification project between Preston and Manchester, going through the heart of my constituency, will continue to deliver more electric coaches for my constituents?
Chris Grayling
I was very pleased to learn this week that the electric trains have now started running between Blackpool and Manchester through my hon. Friend’s constituency. Of course, it is worth remembering that that single electrification project represents a level of electrification many times greater than the Labour party managed across the entire country in its years in office— 13 years: 10 miles, which is fewer, by far, than that single electrification project alone.
Clive Efford (Eltham) (Lab)
If I understand this right, the Secretary of State is claiming a triumph for having signed a contract with a company that had no ferries to provide no ferries and, because it cost the taxpayer no money whatsoever, that is okay. Is that where the Secretary of State is? We are still facing the south-east of England being turned into a huge car park if we were to leave with no deal, and what has he done about it? Absolutely nothing.
Chris Grayling
As I set out, we have substantial contracts with two major operators to provide additional capacity, and we have put in place contingency measures in Kent, in case they are needed because of delays caused not in this country but on the French side. When I see what is happening in Calais and the preparations being made, I am increasingly confident that the flow of traffic through the channel ports will continue pretty normally. It is in everybody’s interest on both sides of the channel for that to happen, and it will certainly happen if we leave the European Union with a deal. It is disappointing, however, that the Labour party seems to want to stymie us leaving the EU with a deal.
Alan Brown (Kilmarnock and Loudoun) (SNP)
The Secretary of State’s handling of Seaborne Freight, and the way he is answering questions, proves that he lives in a parallel universe. The reality is that, with Eurotunnel taking the Government to court, his actions will cost the taxpayer at least £1.8 million and the costs are rising. Will he confirm how many representations have been made by other providers and whether there are likely to be further court challenges? Will he do the right thing and at least publish the legal evidence that the Government had, so that they can perhaps save some money in the long run?
Chris Grayling
The hon. Gentleman is trying hard, but the simple reality is that we approached the market and the market brought forward proposals. We have two substantial contracts to provide additional capacity. We took on a third smaller contract, where there was no upfront exposure to the taxpayer at all. Unfortunately that was not delivered because even though the company had ships lined up and agreements lined up, its principal backer decided not to continue with the contract.
Alan Brown
The Secretary of State did not approach the market—it was all done in secret; that is not approaching the market. He is baffled by the criticism of his handling of this, which is incredible. Let us look at his handling of the mock exercise for lorries in a no-deal scenario, with 89 lorries mimicking 10,000. Under his watch, we have had the east coast main line bail-out, the Northern rail fiasco, the Thameslink fiasco, delays to High Speed 2, issues with drone legislation and contracts awarded to Carillion when it was obviously going bust. What does it take for him to do the right thing and go?
Chris Grayling
The hon. Gentleman continues to produce in the House statements that I am afraid are simply inaccurate. The trial in Kent, managed by Kent County Council, worked very smoothly to illustrate the nature of movements in and out of the port of Manston. He keeps talking about Carillion. Carillion had no contracts with HS2. It was part of a consortium that was jointly and severally liable and that work has continued.
Jessica Morden (Newport East) (Lab)
Alex Cunningham (Stockton North) (Lab)
The Secretary of State for Transport (Chris Grayling)
The Government continue to work towards a deal and we are confident of securing a relationship with the EU that maintains the current liberalised access we enjoy. Of all goods moved by UK-registered heavy goods vehicles in 2017, 1% were moved internationally. We do not expect that there will be significant impacts on international trade movements, or on the haulage sector overall. If we leave without a deal, there might be some short-term disruption, and we have undertaken extensive contingency plans to mitigate this.
Alex Cunningham
Short-term disruption—that’s a good one.
Haulage companies such as Scott Bros. and Devereux in my Stockton North constituency are extremely anxious about their future when we leave the EU. They are not helped much by the road haulage permits legislation, which in effect highlights the potential damage that Brexit will do to the industry, and certainly does not show a Government standing up for the industry. What is the Secretary of State going to do about it?
Chris Grayling
The hon. Gentleman and, indeed, his constituents will welcome the fact that the European Union has been clear that the current arrangements will continue after April and is moving forward with plans to do that. In addition, we have bilateral agreements with other countries that will ensure that international trade continues to flow, and we are of course also continuing members of the common transit convention.
David Duguid (Banff and Buchan) (Con)
Seafood processing businesses in Banff and Buchan have expressed concerns to me about the possible requirement for European Conference of Ministers of Transport permits in the event that we leave the EU without a deal. Will my right hon. Friend meet me and representatives of the sector to discuss their concerns?
Chris Grayling
I am always happy to meet my hon. Friend, and I meet people from the sector quite regularly. His constituents will be assured—indeed, we have written to all applicants for the permits to indicate this to them—that the European Union’s position is that it intends to continue with the current arrangements. We put through measures to make sure that we had a contingency plan, which was supported across the House, but I do not expect it to be needed because, according to the EU itself, we will carry on with the current arrangements.
Meg Hillier (Hackney South and Shoreditch) (Lab/Co-op)
We know that the contract with Seaborne was, in the words of the Secretary of State’s own permanent secretary, a “novel and exceptional” proposition, but she revealed yesterday to the Public Accounts Committee that the only confirmation that the Department had about the arrangements with Arklow were from Seaborne itself. There was no paper document and no contract was signed. The Secretary of State talks about due diligence, but we know it failed on due diligence, and we now know that there was no comfort document for the Department about the contract with Arklow, so will he tell us what due diligence he thinks did take place, because what we have seen shows that it did not?
Chris Grayling
At Christmastime, Arklow confirmed in writing, and we have copies of that—[Hon. Members: “In January.”] At Christmastime, Arklow confirmed in writing that it was backing the proposition. [Interruption.] At Christmastime, Mr Speaker. I hear the sedentary comments but I am absolutely clear: at Christmastime.
Mr Speaker
The hon. Lady does not look satisfied, but I hope that she is nevertheless enjoying her birthday, upon which I congratulate her.
Rachael Maskell (York Central) (Lab/Co-op)
Despite Labour’s warnings throughout the passage of the Haulage Permits and Trailer Registration Bill, just 984 licences have been made available following 11,392 applications. Despite the short-term agreement with the EU, if companies cannot move their goods, they will have no choice but to move their businesses, so why is the Secretary of State running down British jobs and British business?
Chris Grayling
What a load of absolute hokum! We are working very carefully, on a bilateral basis, to make sure that there are contingency plans in place, but the European Union—we have to bear in mind that 80% of the trucks that come through our ports delivering goods to the United Kingdom are run by continental hauliers—is being very clear that it wants that to continue, and it will.
Rachael Maskell
It gets worse: crashing out of the EU in just 43 days’ time will mean that we are a third country, like the Ukraine or China—as indeed, would Irish companies who use the UK as a bridge to the continent. Haulage firms would have to fill out a 38-point document for every single consignment—that is not for each lorry, but for each consignment on each lorry—just hours before each transit, causing catastrophic delays. So who now is the enemy of business? It is this Government, who are running down the clock to create real chaos at our borders. It is surely not this Opposition, who are insistent on a permanent customs union.
Chris Grayling
Of course, what the hon. Lady does not understand is that she talks about a permanent customs union, but a permanent customs union requires border checks. The Labour party simply does not understand the arguments that it is making. It is trying to disrupt Brexit. It is trying to put forward policy ideas that do not work. We are working to secure a deal that will work, and we will carry on doing it.
Simon Hoare (North Dorset) (Con)
Ruth Cadbury (Brentford and Isleworth) (Lab)
The Secretary of State for Transport (Chris Grayling)
The airports national policy statement expects post-expansion Heathrow to deliver 14 domestic routes and to work with airlines to protect existing and develop new domestic connections. We expect these routes to be commercially viable with support from Heathrow.
Ruth Cadbury
I thank the Secretary of State for that answer, but during the airports national policy statement, the Government said that the aviation Green Paper would address the level of public subsidy required to support certain regional connections into Heathrow, but the Green Paper, now published, says that when there is such a requirement for a public services obligation route,
“funding contributions should increasingly be provided locally.”
Will he therefore confirm that many local councils that were hoping to reap economic benefits from additional regional routes may in fact end up having to subsidise loss-making routes?
Chris Grayling
As the House will know, it is often custom and practice to share the cost of a public service obligation with a local authority. It is right and prudent for the Government to seek to share the load when we can.
Justine Greening (Putney) (Con)
Next week, I will hold a public meeting in my constituency on Heathrow expansion. Many of my constituents are concerned that Heathrow is just like Seaborne. It is another case where the Department for Transport has fallen hook, line and sinker for impossible claims made by a company that has very little chance of ever delivering on them—“Not a single extra car going to the airport,” and, “Air pollution not a problem,” even though we know that it is a huge problem in that part of London. It is exactly the same. The difference, though, is that when the Heathrow proposals go utterly pear-shaped, taxpayers will pick up the bill, and this is not just a £14 million project, but an £18 billion project.
Chris Grayling
My right hon. Friend is very committed to her view on this matter, but this House voted by a majority of nearly 300 to pursue this project and give Heathrow the green light. It now has to go through detailed consent processes, but I believe that it is a project that is strategically important to the United Kingdom.
Seema Malhotra (Feltham and Heston) (Lab/Co-op)
A new Southern rail link connecting the south and south-west with Heathrow via Feltham was favourably assessed by Network Rail two years ago as having the highest benefit-cost ratio of all the Southern rail options proposed. We are waiting on the edge of our seats for progress towards the next stage. When will the Secretary of State be able to announce funding and proposed plans to take the project to the next stage, so that we can start to move forward?
Chris Grayling
I regard Southern rail access as extremely important. We are now looking in detail at what we believe the specification of the scheme should be. It will clearly require some degree of public support, and that is the next stage, which I expect to pursue in the coming months, albeit relatively soon.
Steve Double (St Austell and Newquay) (Con)
I thank the Secretary of State for his support for the new Heathrow connection to Cornwall Airport Newquay, which is due to come into place on 1 April. However, with the proposed acquisition of Flybe by Virgin Atlantic, can he reassure the House that Government support for the new route will continue even if the operator changes?
Chris Grayling
Absolutely. My hon. Friend knows my commitment to making sure that we continue those links to Newquay. They are an extremely important part of Cornwall’s economy, and I will be working to ensure that nothing happens to interrupt those services.
Several hon. Members rose—
Andrea Jenkyns (Morley and Outwood) (Con)
The Secretary of State for Transport (Chris Grayling)
A moment ago, I talked about the importance of the Union—the United Kingdom of Great Britain and Northern Ireland—and we also talked about regional air links. I am pleased to announce that I have agreed to extend the current public service obligation on flights from Londonderry to Stansted for a further two years from May. I believe that that will provide a boost for business in Northern Ireland and, rather importantly, allow spectators to attend the 148th open championship at Royal Portrush this summer.
Andrea Jenkyns
The fantastic pupils at Outwood Primary Academy Ledger Lane in my constituency have organised a petition calling for Wakefield Metropolitan District Council to improve road safety and have persuaded 430 parents and teachers to sign it. The signatories want to see a speed indication device, or other speed restrictions, outside the school. What is the Secretary of State doing to improve road safety outside schools?
Chris Grayling
The Government are combining a range of measures including our cycling and walking safety two-year action plan, which addresses that issue specifically. However, I hope that Wakefield Council, which holds the power to install speed indication devices, will look carefully at the petition, and will respond positively to my hon. Friend’s young constituents.
Dr Philippa Whitford (Central Ayrshire) (SNP)
Chris Grayling
We have, of course, supported ferry links farther north, but I think that the additional capacity from east coast ports may, in many circumstances, provide a realistic alternative—indeed, a real alternative—for manufacturers and producers in Scotland.
Scott Mann (North Cornwall) (Con)
Sarah Jones (Croydon Central) (Lab)
Chris Grayling
I do not need to come and have a look, because I travel through Croydon, via the west Croydon route, quite regularly. I know that there is a need for significant improvement in the area of the Windmill Bridge junction. My hon. Friend the Member for Croydon South (Chris Philp) has been vociferous in telling me that that needs to happen, and the Department and Network Rail have already started work on what we believe will be an important project for the future.
Mary Robinson (Cheadle) (Con)
Chris Grayling
As my hon. Friend will know, the Mayor of Manchester and I recently agreed to work together on the potential expansion of the Metrolink network with the use of tram-train technology. The Government have already funded a tram-train system in Sheffield, which is making a difference there, and I am keen to see how we can extend that to Greater Manchester.
Tom Brake (Carshalton and Wallington) (LD)
Mr Gregory Campbell (East Londonderry) (DUP)
The Heathrow logistics hub process is coming to a conclusion, and there are a number of bids from Northern Ireland, including one from my constituency. Without prejudicing the outcome, will the Minister ensure that he co-operates closely to ensure that there are regional variations to benefit thousands of jobs in Northern Ireland?
Chris Grayling
I have already told Heathrow airport that, while the detail of the decisions is a matter for them, I would certainly want to see a proper spread across all parts of the United Kingdom.
Richard Burden (Birmingham, Northfield) (Lab)
After awarding the contract to Seaborne Freight, the Secretary of State boasted to the House that he was backing a British start-up. I tabled a written question to his Department asking whether it was his working assumption that any ships operated by Seaborne would operate under the British flag. Why were his Ministers, in the answer I received on 14 January, unable to give a straight yes or no answer?
Chris Grayling
Because these are matters for a commercial company. I think that it is still the right thing for a British Government to do to support British start-up businesses, but these are commercial matters for those businesses.
Several hon. Members rose—
Joanna Cherry (Edinburgh South West) (SNP)
On Monday, the Secretary of State justified the non-competitive tendering process for Seaborne Freight by referring to a “change in the assumptions”. Would he care to elaborate on exactly what he meant by that? Does he think that that defence will stand up in court?
Chris Grayling
I recall explaining on Monday precisely what the circumstances were, and I do not want to detain the House any longer by repeating an answer that I gave to the hon. and learned Lady three days ago.
Seaborne Freight
Lord Grayling Excerpts(5 years, 9 months ago)
Commons ChamberRead Full debate Read Hansard Text Read Debate Ministerial Extracts
Andy McDonald (Middlesbrough) (Lab)(Urgent Question)
To ask the Secretary of State for Transport if he will make a statement on the cancellation of a contract with Seaborne Freight as part of the Government’s contingency planning for a no-deal Brexit.
The Secretary of State for Transport (Chris Grayling)
In December, following a collective Government decision and a procurement process involving my Department and the Treasury, we contracted with three shipping companies to provide additional ferry capacity as part of contingency planning for a potential no-deal EU exit.
Let me make it absolutely clear that in the event of a no-deal Brexit, the Government’s priority will be to ensure the smooth operation of both the port of Dover and the channel tunnel, and we are introducing measures at the UK end to contribute to that. However, any sensible Government plan for all eventualities. That is why we agreed contracts worth around £100 million, with the bulk of the award—£89 million—going to DFDS and Brittany Ferries to provide services across seven separate routes. Built into those agreements are options to add capacity on two other routes from those companies, should they be required. That capacity could be needed to guarantee the smooth flow of some key goods into the UK, particularly for the NHS. It is worth my reminding the House that, in the event of no deal and constriction on the short strait, the capacity would be sold on to hauliers carrying priority goods.
In addition to the £89 million-worth of contracts with DFDS and Brittany Ferries, the Department entered into a £13.8 million contract with Seaborne Freight to provide ferry services from the port of Ramsgate to Ostend. At the time of the award, we were fully aware of Seaborne’s status as a start-up business and the need for it to secure vessels and port user agreements to deliver a service. However, the shorter distance between the two ports meant that the route could provide us with shorter journey times and lower cost, making it a potentially attractive part of the package.
Seaborne’s proposition to the Department was backed by Arklow Shipping, Ireland’s biggest and one of Europe’s largest shipping companies. For commercial reasons, I have not been able to name Arklow Shipping or mention its involvement to date, but its support for the proposition from the outset and the assurances received by the Department provided confidence in the viability of the deal. Arklow confirmed to me that it intended to finance the purchase of ships and would be a major shareholder in Seaborne. It also confirmed to me its view that the Seaborne plans were “both viable and deliverable”. Those assurances included clear evidence about the availability of suitable vessels from the continent and about the formal steps that Seaborne, via Arklow, had taken to secure the vessels. However, releasing that information into the public domain could have driven up the cost of the vessels significantly and might even have resulted in their being removed from the market, where supply is extremely scarce. I have therefore had to refrain from saying anything publicly about this to date.
My Department monitored closely Seaborne’s progress towards meeting its contractual commitments. By last week, the company had secured firm options on ships to operate on the route, had reached provisional agreement with Ostend and was close to doing so with Ramsgate. However, late last week, despite previous assurances, Arklow Shipping suddenly and unexpectedly withdrew its backing from Seaborne. In the light of this, and after very careful assessment, I took the decision to terminate this contract. My Department concluded that there were now too many major commercial issues to be resolved to enable Seaborne to establish alternative arrangements and finance in the time needed to bring ferries and ports into operation.
As I have repeatedly made clear, not a penny of taxpayers’ money has gone, or will go, to Seaborne. The contracts we agreed with the three ferry companies are essentially a commitment to block-book tickets on additional sailings after the UK leaves the European Union. So actually we have taken a responsible decision to make sure that taxpayers’ money is properly protected.
I can confirm that the contracts with DFDS and Brittany Ferries remain on track and will provide us with valuable additional freight capacity into the UK in the event of disruption following EU exit. We also have contractual options to replace the Seaborne capacity with additional capacity on routes in the North sea, and this is an option we will be discussing across the Government in the coming days.
While the focus of this Government is to secure a deal with the European Union, as a responsible Government we will continue to make proportionate contingency plans for a range of scenarios. That is the right thing to do.
Andy McDonald (Middlesbrough) (Lab)
What began as a debacle has now descended into a Whitehall farce. This Minister is rewriting the textbook for ministerial incompetence in office. I repeatedly warned the Secretary of State that this was the wrong decision at the time, as did industry, yet he chose to ignore those warnings. He told the House last month that this procurement was done properly. It has since emerged that the Department for Transport took shortcuts on the Seaborne Freight procurement. The deal was signed off by a sub-group of a sub-group and the main form of oversight, the procurement assurance board, never looked at it.
The Secretary of State points the finger at Arklow for the contract cancellation. Is it really a good time to further insult the Irish, and is the Arklow angle not a distraction from his decision? He has produced a letter from the company more than a month after the contract was signed; it does not prove anything regarding due diligence. He told this House that the Seaborne contract award was
“responsible stewardship of public money.”—[Official Report, 8 January 2019; Vol. 652, c. 191.]
Sadly, the exact opposite is true, yet again.
The Secretary of State’s decision to award the contract to Seaborne led Ramsgate port owner Thanet Council’s budget deficit to grow by nearly £2 million in the last year. His personal intervention to halt the budget vote last Thursday has compounded those losses. Two days later, he pulls the plug on Seaborne, leaving the council high and dry with mounting losses. What is more, taxpayers face a legal bill of nearly £1 million to fight Eurotunnel following his decision. So can he say how much cancelling the contract will cost the taxpayer and specifically the costs incurred in his own Department? He simply cannot keep blaming others for his own mistakes. This disastrous decision sits squarely with him and his office. Is this Transport Secretary’s approach to transport and wider Brexit contingency planning not off the Richter scale of incompetence? And for the good of the nation and the sake of some semblance of faith being restored to this shambolic Government, should he not now, at long last, do the decent thing and go?
Chris Grayling
I have to say that the hon. Gentleman brings new meaning to the term “utter hogwash”. First, he clearly was not listening when I said that we have spent no money on this contract. My Department is doing a lot of work on no-deal Brexit preparations, as are other parts of Whitehall—that is the prudent thing to do—but we have not spent any money on this contract. The contract was in fact assured jointly by my officials and officials in the Treasury.
The hon. Gentleman says the letter is worth nothing, but let me just quote from the letter, from the managing director of Arklow Shipping, one of Europe’s biggest shipping companies with operations in Rotterdam and Ireland, which covers chartering, technical and crewing, and finance. He said:
“Arklow Shipping has been working with Seaborne for twelve months in connection with Seaborne’s proposals to develop new freight services between the UK and continental Europe. Arklow Shipping is therefore familiar with Seaborne’s agreement with Her Majesty’s Government to provide additional freight capacity in the event of the UK’s departure from the European Union on a no deal basis.
3. In support of the current proposals to develop the shipping route between Ramsgate and Ostend, Arklow Shipping intends to provide equity finance for the purchase of both vessels and an equity stake within Seaborne which will be the operating entity of this project.
4. Seaborne is a firm that brings together experienced and capable shipping professionals. I consider that Seaborne’s plans to deliver a new service to facilitate trade following from the UK’s departure from the EU are both viable and deliverable. I will be working closely with the team at Seaborne to ensure that they have appropriate support from Arklow Shipping to deliver on their commitments to Her Majesty’s Government.”
Enough said.
Craig Mackinlay (South Thanet) (Con)
Does my right hon. Friend share my disappointment that Arklow Shipping, a major Irish shipping company and the main backer of Seaborne, has pulled away from this contract? Can he give assurances to Thanet District Council and local taxpayers that the cost of keeping Ramsgate in a state of readiness as part of the Brexit contingency planning, which we are all happy to do, will not fall on local taxpayers?
Chris Grayling
I share my hon. Friend’s disappointment. We are spending a lot of money on contingency planning and resilience in Kent, and I personally regard the port of Ramsgate as an important part of that. He knows that I am committed to continuing to work with Thanet District Council, and I would like to see ferries come back to Ramsgate. Whatever happens, we must make sure that we keep open opportunities for the future, in my view.
Alan Brown (Kilmarnock and Loudoun) (SNP)
Last month, the Secretary of State said that he had full confidence in Seaborne, and just last week he lobbied Thanet Council on its budget plans for Ramsgate. Does this not tell us everything we need to know about his judgment? His argument that Seaborne accounted for only 10% of the proposed additional services and that it did not matter if it did not deliver was nonsensical. Flouting EU procurement rules on unforeseen events by arguing that this was an emergency situation was also fundamentally flawed, given that he awarded a contract to a company with no ships. He says that he has been in negotiations with Seaborne for 12 months. How is that an emergency situation? He has now created his own emergency procurement process.
How many representations has the Secretary of State’s Department received on the procurement process, and are those representations still live, given the two contracts worth £89 million that he has awarded? Are we ever going to see the legal advice and the due diligence that was supposed to have been undertaken? Also, he has not answered the question on why this contract was not referred to a procurement assurance board. What will this missing 10% of capacity mean for Dover? What impact will it have on the port there? To keep HGV freight moving, what is his Department doing about the backlog of 9,000 ECMT permits? Given that he has now reached a stunning new level of incompetence, which must have been really hard to achieve, when will he go?
Chris Grayling
I am not sure that the hon. Gentleman was listening to a word I said. He asked a question about no ships. I can confirm that, as of last week, two ships had been identified and that options were in place to operate the route. This makes it even more disappointing that Arklow was not able to continue its support. He asked a question about negotiating for 12 months. That was Arklow, not my Department. He asked a question about the legal position. The legal position was signed off by officials in my Department and by the Treasury and by my accounting officer. The hon. Gentleman also asked about extra routes. As I mentioned in my remarks, we already have options for additional capacity in the North sea. Those routes are clearly longer and more expensive, but they are available to us. He asked about the ECMT permits. The current position is that the European Union has been very clear that we will continue with the current arrangements. I know of no reason why that should not happen, but we have bilateral arrangements that we can fall back on if it does not.
Sir Roger Gale (North Thanet) (Con)
Setting aside the utterly synthetic outrage dribbling from Opposition Front Benchers, and further to the answer given to my hon. Friend the Member for South Thanet (Craig Mackinlay), I should like to tell the Secretary of State that Councillor Bob Bayford, the leader of Thanet Council, has made it plain that Thanet wishes to act in the national interest and will continue to seek to do so, but it cannot act alone. There is a contract that Thanet has not yet signed, and will not now sign, with Seaborne Freight. That contract is ready for signature. Is there any reason, given the precedent set with Manston airport, why the Department should not sign that contract and take over the port itself for the duration?
Chris Grayling
As my hon. Friend knows, I have had discussions with the leader of Thanet District Council over the past few days, and I have been clear that there is a strong case to include Ramsgate port in the resilience work being done in Kent to prepare for a potential no-deal Brexit. We must also be mindful of the council’s financial position and ensure that it is not exposed to financial risk as a result of the broader resilience work happening across Kent.
Lilian Greenwood (Nottingham South) (Lab)
Questions remain about the legality of all three contracts for additional ferry capacity. The Government used an accelerated procurement process to award the contract to Seaborne Freight, which can be done only in urgent and unforeseeable circumstances. The Department said that the circumstances were the
“unexpected and unforeseeable limitations on the extent to which the market had… been able to”
put “in place contingency plans” for a no-deal Brexit. Given that the Government have consistently provided reassurances that that there will not be a no-deal Brexit, how was it “unexpected and unforeseeable” that the market was unable or unwilling to put in place contingency plans for this scenario?
Chris Grayling
The particular prompt for this procurement exercise was a change in the assumptions last autumn about the level of potential disruption around the channel ports. That prompted us to look again at what the capacity requirements might be to maintain supply of essential services into the United Kingdom, particularly for the NHS. It would be prudent for any Government in such a position to plan for all eventualities. I want the UK to leave the European Union with an agreement, and we are working hard to achieve that, but we would not be doing our job properly if we were not preparing for all eventualities.
Mr Mark Francois (Rayleigh and Wickford) (Con)
I offer strong support to the Secretary of State because, unlike the Labour party, he is actually undertaking contingency plans for all eventualities. On that point, will he update the House on the other two ferry contracts, their status and when they will come into operation?
Chris Grayling
My right hon. Friend makes an important point. I have heard nothing from Labour bar attempts to disrupt the Brexit process. There has been no support for contingency planning or for a deal. All Labour Members seem to want to do is to act against the national interest, which is typical of the Labour party today. Its Members are more interested in themselves than in the country.
As for the other two contracts, they are proceeding according to plan. The routes will be ready, but I hope that they will not be needed, because I hope that we will leave the European Union with a deal. However, we must be ready, and we will be ready.
Grahame Morris (Easington) (Lab)
The Secretary of State spent a great deal of time maligning the RMT union, which had simply been asking that Ministers ensure that the Brexit ferry contract ships are crewed by British seafarers on decent pay and terms and conditions negotiated through the recognised trade unions. Can the Secretary of State answer a straight question? In answer to the previous urgent question, he talked about the advantages of developing a facility at Ramsgate, so will he confirm whether Ramsgate will be now be used at all in the event of a no-deal Brexit?
Chris Grayling
I believe in competition, so I would like Ramsgate to operate a ferry service whether there is a no-deal Brexit or not, and I know that the leader of Thanet District Council would like to see the same. It is a good port that has played an important role in the past. However, we will continue to work with the council not only to secure the short-term needs of the port of Ramsgate, but to help it promote the port as a viable option for the future.
Mr Robert Goodwill (Scarborough and Whitby) (Con)
We have heard a lot of nonsense about the company not owning any ships, but is it not the case that the majority of rail operators in this country do not own any trains and that many airlines wet lease aircraft, meaning that not only do they not own the planes, but they do not directly employ the crew?
Chris Grayling
My right hon. Friend makes an important point. I have said that the Labour party does not like business any more, but it does not understand business any more. Many Labour Members will go on holiday this summer using airlines that own no planes, because that is how business works, but they lost any understanding of how business works long ago, and I see no sign of that changing.
Ms Angela Eagle (Wallasey) (Lab)
Last month, the Secretary of State came to the House waxing lyrical about his support for start-up businesses, meaning Seaborne Freight. Is he not even remotely embarrassed that the project has fallen to pieces despite Government support? Will he not at least say sorry to the House for the mess that he has made?
Chris Grayling
This is a start-up business that did not succeed because its principal backer changed its mind. That is to be regretted and it is a great shame but, as a Minister, I will never make an apology for the Government trying to work with new small businesses. Again, the Labour party does not like small business and does not want us to work with small business. When we do, it shouts and screams. Well, I think the Government should do more for small business, and I am going to carry on doing so.
Mr Jacob Rees-Mogg (North East Somerset) (Con)
My right hon. Friend cannot possibly be criticised for entering into a contract, which cost the taxpayer no money, with a new business backed by one of the biggest shipping owners in Europe. Is it not eccentric of Arklow to behave in the way it has and to abandon a contract it supported a fortnight ago? Is there any question of the Irish Government’s involvement either to help or to hinder one of their biggest businesses?
Chris Grayling
It is not for me to ascribe any motivations to Arklow for the decision it has taken. I regret it having taken that decision, and I think it is a shame, particularly as it gave clear commitments to Seaborne at Christmas time and to my officials and me in January before changing its mind suddenly. I do not know what prompted that decision. I just think it is a very great shame.
Tom Brake (Carshalton and Wallington) (LD)
What will it take for this Secretary of State to get the sack? Let me see if the following would cause the Prime Minister to issue him his P45: breaking EU procurement rules. Does the Secretary of State really believe he can claim no deal is an emergency that came to light only in October? If it did, it is his fault for underestimating the disruption caused at the ports. Is he confident that this argument is going to stand up in court?
Chris Grayling
I have been absolutely clear that this procurement was dealt with very carefully by officials in my Department and in the Treasury who fully understood the legal implications of it, and it was approved by my accounting officer. I will not comment on any other legal matters.
Charlie Elphicke (Dover) (Con)
The whole House knows that the Secretary of State has been one of the most assiduous Cabinet members in working on contingency plans to make sure that we execute the national interest in leaving the European Union. Has he looked at the possibility of not simply Dover to Calais and Dunkirk but Dover to Zeebrugge? That is a short sea route going to Belgium, not France.
Chris Grayling
Absolutely. I am also aware that the port of Zeebrugge has made a lot of preparations for the post-Brexit world. One of the things that can help to ease pressure on Dover would be an additional route from Dover to Zeebrugge. I am very keen to see the port of Dover carry on through the Brexit process without significant disruption, and I will do everything I can to help it achieve that goal, but it is sensible to have some easing of pressure on both Dover and the tunnel to give guarantees on services such as the NHS. I will be doing everything I can to make sure things remain as normal as possible for Dover.
Mr Chris Leslie (Nottingham East) (Lab/Co-op)
Given that this is just one example of hapless contingency planning that we are aware of, and that there may be all sorts of other haphazard things going on, should not the Secretary of State commit to more transparency about contingency planning more broadly? He knows that the Operation Yellowhammer papers on trade and transport went before the Cabinet last week, and there was a discussion at full Cabinet about whether those papers should be published. Which side of the argument was he on? Was he for publication?
Chris Grayling
Let us be clear, first of all, that Cabinet minutes are not published. I have been pretty transparent over the months in explaining what we are doing on the aviation front and the haulage front. We have been having regular contact with industry, and we are working very closely with the aviation sector and the haulage sector. I do not think we can be accused of hiding what we are doing. The reality is that I am standing here today precisely because we did not hide what we are doing, as we published the detail of these contracts.
Mrs Sheryll Murray (South East Cornwall) (Con)
May I send a message to the Secretary of State? The south-west and Plymouth are open for business, and I am sure that my constituents who work in that city would really welcome any further opportunities that a contract would present.
Chris Grayling
I am grateful to my hon. Friend; it has been good to see Members from around Plymouth welcoming the extra traffic that would flow through Plymouth as a result of these contracts. I should also take the opportunity to provide a message of reassurance to Hampshire, where we have done extensive work around the port of Portsmouth in respect of just a couple of extra sailings a day. Let me put it clearly on the record that there is no expectation of major road disruption affecting the surrounding areas of either Plymouth or Portsmouth.
Joanna Cherry (Edinburgh South West) (SNP)
The UK Government have been aware of the possibility of a no-deal Brexit since article 50 was triggered in March 2017, so can the Secretary of State tell us why this contract, which was awarded only at the end of December 2018, proceeded under regulation 32 of the Public Contracts Regulations 2015 without competitive tendering? Will he state clearly for the record, as I have asked this question of him and other Ministers five times now: what were the reasons of extreme urgency and the unforesee- able events that justified his Department proceeding without competitive tendering under regulation 32?
Chris Grayling
The hon. and learned Lady was not listening a moment ago when I answered that very same question from the Chair of the Select Committee. I said that the thing that prompted the move was a change to the assumptions on the levels and length of disruption that might arise in a no-deal Brexit scenario.
James Cleverly (Braintree) (Con)
Part of the criticism that my right hon. Friend’s Department has received has arisen because Seaborne Freight was seen as a company that had no track record in shipping. We now know that Arklow was the company behind Seaborne Freight, and it had a huge amount of experience in shipping. What more can be done, in terms of no-deal preparations and more broadly, to ensure that when new start-up companies that are backed by well-established companies present themselves to Government the House can understand the relationship between those start-ups and the companies backing them?
Chris Grayling
We always have to take steps to be careful about commercial confidentiality, particularly when a company is in a complex negotiation, as was the case in this situation in respect of new ships. I was clear to the House when I spoke a few weeks ago that Seaborne Freight had substantial backers. It is really important that when Ministers stand up and say, “Look, we know they have substantial backers”, the House does not disbelieve that, because actually it has proved to be true.
Luke Pollard (Plymouth, Sutton and Devonport) (Lab/Co-op)
The Secretary of State has said that no money has been spent on this process, so could he tell us how many of his officials were working for free during this process? He says no money has been spent, but what about the embedded cost? The time each official and each Minister has spent on this project is cost, so will he publish the costs of how much time has been spent on this debacle? If he will not resign, will he at least apologise for this mess?
Chris Grayling
Dear oh dear, they keep trying, don’t they? We have hundreds of civil servants across Whitehall working on no-deal preparations to make sure that we are ready in case it happens. I am clear that we do not want no-deal, but we are taking the necessary precautions. The problem is that the Labour party does not believe that should be happening.
Mr Philip Hollobone (Kettering) (Con)
With regard to no-deal preparations, will the Secretary of State confirm to the House, once again, that we have signed the common transit convention, which means that import duties and customs declarations do not have to be sorted out until goods arrive at their final destination? In his reply, will he also mention that the mayor of Calais has said that Calais will be open for business even in the event of no deal?
Chris Grayling
Both of the points made by my hon. Friend are absolutely correct. My view is that the common transit convention solves many of the problems. We cannot be 100% certain, because we have not had confirmation from the French yet about how they would manage border posts in Calais, notwithstanding the common travel convention, but he is absolutely right that it should enable trade to flow through smoothly. I have been clear in saying regularly that I expect those ports and the tunnel to operate pretty much normally, but we have contingency in place just in case that is necessary.
Thelma Walker (Colne Valley) (Lab)
A fake lorry traffic jam in Kent, rail timetable chaos, which is still affecting commuters and local businesses in my constituency, and now a cancelled contract with a ferry company that owns no ferries—is the Secretary of State proud of his record?
Chris Grayling
There was no fake traffic jam; it was an exercise to test the movements of vehicles into and out of Manston in Kent. The timetable troubles were caused by a project where Government were investing in rail infrastructure in the north-west—something that never happened under Labour—which ran late. As I said a moment ago, this shipping company identified and got firm options on two ships but was unfortunately not able to carry on because its backers pulled out.
Michael Tomlinson (Mid Dorset and North Poole) (Con)
Despite the hogwash and doom-mongering from the Opposition Benches, the Secretary of State is absolutely right to ensure that there is contingency planning for every eventuality. For the avoidance of doubt, will he confirm that the taxpayer’s interests have not been damaged and that he will continue to take all necessary steps to ensure that we are ready, deal or no deal?
Chris Grayling
Absolutely. This is essential Government spending across Government. We have to be ready for all eventualities. I make no apology for the fact that the Government are spending money on preparing for no deal, but my view is that the best kind of contract for the Government is one for which we pay no money until the service is delivered and, of course, that is what we had in this case.
Jonathan Edwards (Carmarthen East and Dinefwr) (PC)
Over the past year, a new start-up based in my constituency, Carmarthen Bay Ferry, has successfully operated an excellent service for the people of Carmarthenshire and tourists, linking Glanyfferi in my constituency and Llansteffan on the other side of the Towy estuary. In the light of the collapse of their arrangement with Seaborne Freight, will the British Government have a look at the Carmarthen ferry model to see how to run a successful ferry operation?
Chris Grayling
I am not sure that operating a freight haulage operation across the English channel is quite the same as operating what I am sure is a fine business in the hon. Gentleman’s constituency, but I wish it well for the future anyway.
Andrew Bridgen (North West Leicestershire) (Con)
“When the facts change, I change my mind” is a quote widely attributed to John Maynard Keynes, someone normally highly supported on the Opposition Benches. Will my right hon. Friend the Secretary of State confirm that the facts have changed and it is only prudent that Government policy changes to reflect the new reality?
Chris Grayling
Absolutely. We set out a plan, and I was clear that we did not expose the taxpayer to risk. The events of last week happened, so we changed our mind. My hon. Friend is absolutely right. The best thing for the Government to do is to pursue the right policy at the right time.
Mary Creagh (Wakefield) (Lab)
It is touching to see this arch-Brexiteer Secretary of State relying on the good will of an Irish shipping company and the Dutch dredging firm that dredged the port of Ramsgate. Will he tell us whether that dredging was carried out under the appropriate licences and who will pay for it? He talked about due diligence; Arklow told “Channel 4 News” that it did not agree to the contract with Seaborne and blamed the UK Government for moving too fast. If Arklow could do the due diligence on Seaborne, why could not the Secretary of State?
Chris Grayling
I can only refer the hon. Lady to what I quoted earlier:
“I will be working closely with the team at Seaborne to ensure that they have appropriate support from Arklow Shipping to deliver on their commitments to Her Majesty’s Government.”
It is there, plain, in black and white.
Dr Matthew Offord (Hendon) (Con)
There has been much ridicule of Seaborne Freight because it did not own any ferries but, to build on the theme of the question from my right hon. Friend the Member for Scarborough and Whitby (Mr Goodwill), is the Secretary of State aware that Uber does not own any taxis and, indeed, Airbnb does not have any hotels, either? Does he agree that it would be more ridiculous if the Government had not planned for a no-deal scenario and had refused to award any finances to it, as the shadow Chancellor advocated?
Chris Grayling
This is the point: the Labour party wants to disrupt Brexit. It wants us to leave the European Union but will not approve the deal and does not want us to prepare for no deal, so it has no policy at all. Frankly, as I have said on more than one occasion, Labour is not fit to be an Opposition, let alone a Government.
Karen Lee (Lincoln) (Lab)
Did the Secretary of State’s decision to cancel the contract with Seaborne predate the letter from Arklow—yes or no?
Tom Pursglove (Corby) (Con)
In the light of the decision to end Seaborne’s contract, what discussions has the Secretary of State had with other providers about their providing extra capacity?
Chris Grayling
We made provision in the contracts that we signed with Brittany Ferries and DFDS for additional capacity on other routes, that were not in our original mix. Those are options that we are free to take up and we will have cross-Government discussions in the next few days to assess current needs and forecasts and see whether that is required.
David Hanson (Delyn) (Lab)
The Secretary of State says that there are no costs to Government, so for the avoidance of any doubt, will he place in the Library the costs of any legal fees and the numbers and types of civil servants working on both the pre-work and the cancellation? Will he tell us the total cost of all that to the taxpayer?
Chris Grayling
My Department is accruing a bill of many, many millions of pounds, preparing for a no-deal Brexit in a whole variety of different areas—we are working on maritime, aviation and haulage—and I regularly answer questions about those amounts through written questions. I am also always happy to place information on those amounts in the Library of the House.
Kevin Foster (Torbay) (Con)
I am sure that, like me, the Secretary of State finds it interesting to come into this Chamber one day and hear complaints about the potential impact of no deal, and to come in here the next day and hear complaints about the efforts to mitigate those impacts. Will he confirm what work has been done to ensure that the main routes across the English channel—the Eurotunnel and the main crossings between Dover and Calais—will continue working even in a no-deal scenario?
Chris Grayling
My Department and I are working on detailed plans to ensure that the pressures on both the tunnel and the port of Dover are as small as possible. I am very confident, as I have said on more than one occasion, that things will move pretty smoothly through there. The purpose of this additional capacity is to ease some of those pressures and to prepare for contingencies if they are required.
Layla Moran (Oxford West and Abingdon) (LD)
The Secretary of State has mentioned several times now his reliance on his Department, but in the end the buck stops with him. When evaluating these bids, it is worth noting that Deloitte did not make a formal assessment of Seaborne’s financial stability because it was not incorporated until April 2017. Mott MacDonald provided a technical assessment of that and the review flagged up significant execution risks relating to the Seaborne bid. We may not all be experts in everything we talk about, but surely the public expect a level of common sense when it comes to things as big as this. Where was the common sense of the Secretary of State when it came to this contract?
Chris Grayling
The common sense came in two forms: first, when Arklow Shipping confirmed to my Department in writing in December that it was supporting this; and, secondly, because we had a contract where no payment was made until the service was delivered.
Chris Green (Bolton West) (Con)
Spectators of this debate may think that the greatest of catastrophes has happened, but all this debate really reveals is the Conservatives’ support for innovation, for small business and for delivering on Brexit, and the Opposition’s opposition to that.
Chris Grayling
I keep saying that I find it baffling that the Opposition should be opposed to giving a chance to a small business when the taxpayer was exposed to no financial risk at all, particularly when that small business had a major international backer. It is inexplicable.
Richard Burden (Birmingham, Northfield) (Lab)
On successive occasions, the Secretary of State has assured the House that he carried out full due diligence tests of this contract before he awarded it, but I for one am none the wiser about what those due diligence checks consisted of. Today, will he answer the question that he failed to answer when he last appeared before the House on this matter? In April last year, Seaborne Freight issued an investor briefing that claimed:
“Detailed port agreements with Ramsgate and Ostend negotiated and agreed.”
We now know that no such agreements existed. Did his due diligence checks not reveal that and, if not, what kind of due diligence was it? Or did they reveal that and, if so, what weight did he attach to the fact that Seaborne had issued an inaccurate investor briefing?
Chris Grayling
The comfort that we had was that the three professional advisers advised us that credible plans were in place. That was reinforced by written confirmation from Arklow Shipping that it was supporting the proposal and by the fact that we protected the taxpayer’s interests by ensuring that no funds would be paid over unless this was delivered. The fact that, last week, we had a firm that had options on ships and agreements reached in principle with both ports, suggested to me that it was on the right track. It was just a shame that the backers did not feel able to continue.
Helen Goodman (Bishop Auckland) (Lab)
In another triumph of the Department’s no-deal Brexit planning, the Secretary of State’s junior Minister wrote to all Members of Parliament about the hauliers who, presumably, will use these sea routes, saying that 3,816 international permits had been awarded, but there are 526,000 HGV hauliers in this country, so fewer than 1% will be able to get a licence. Is this really going to work in the event of no deal?
Chris Grayling
As you will be aware, Mr Speaker, the European Commission has already said that it wants haulage to continue. It does not expect a permit-based system to be required. But in the event of a no-deal Brexit, we have bilateral agreements with a number of other EU member states that come into effect. We have put in place a system to distribute the ECMT permits precisely because we want to make sure that all bases are covered. However, we wrote to hauliers last week saying that they were being issued as a formality. Nothing that has happened so far would lead us to believe that those restrictions will be there.
Jim Shannon (Strangford) (DUP)
I thank the Secretary of State for his answers so far. Has he had the opportunity to review the unexplainable action of Irish firm Arklow Shipping in relation to its agreement with Seaborne Freight? Was there a signed contract or is it the case, as some stories today indicate, that the Republic of Ireland and the EU are doing all they can to frustrate Brexit?
Chris Grayling
I do not want to attribute any possible reasons for Arklow Shipping pulling out. It was a shame that, just at the point when everybody had draft contracts in place ready for signing, the company backed away. It is a regret that that is the case. I would have liked to have seen this new service come into effect, if only to ensure that the port of Ramsgate had alternative business for the future, but I am afraid that it is not for me to comment on the motivations of the company involved.
Mr Paul Sweeney (Glasgow North East) (Lab/Co-op)
Perhaps when the Secretary of State is finally fired for his incompetence over this issue, he might get the consolation prize of being invited on to Comic Relief’s special edition of “The Apprentice”, where we can see him on “Team Seaborne”, trying desperately to fill in the capacity that he has failed to provide as Secretary of State. I think we could all do with a laugh on that front. The reality is that the financial risk is neither here nor there. There are barely 50 days to go and the Secretary of State has still failed to provide that vital freight capacity, so where is it coming from? Is he going to ask the Ministry of Defence to provide this emergency capacity?
Chris Grayling
Dear, oh dear; you do get them from the Opposition, Mr Speaker. The hon. Gentleman has clearly not been listening to a word I said. I said that we have options available on two other routes in the North sea. Those routes take longer and are more expensive, but we have had them in reserve all along. I judged and we judged—my Department felt—that it would be better if we could have access to a shorter route from Ramsgate to Ostend. That has not worked out and we now have the option to return to the original choices.
Brendan O’Hara (Argyll and Bute) (SNP)
Putting aside the further reputational damage caused, is the Secretary of State fully satisfied that he has handled this affair to the very best of his ability? If this embarrassing shambles was indeed him at his very best, what on earth has to happen on his watch to make him resign?
Chris Grayling
Dear, oh dear. I will simply say that I am always going to do what I believe to be in the national interest, and that is what I and my team in the Department have been doing.
Louise Haigh (Sheffield, Heeley) (Lab)
One of the many things that this shambles reveals is the Government’s utter lack of preparedness for a no-deal Brexit. To avoid any more embarrassments for the Secretary of State, is not it high time that his Government ruled out a no deal?
Chris Grayling
If the hon. Lady wants a non-no-deal Brexit, she should line up behind the deal that the Government have reached with the European Union, but if she is not prepared to vote for it, she should not complain when Ministers are preparing for all eventualities.
Kevin Brennan (Cardiff West) (Lab)
The hon. Member for Argyll and Bute (Brendan O’Hara) has been very unfair; I am sure the Secretary of State is handling this to the best of his ability.
The Secretary of State was very careful not to answer the first part of the question from the hon. Member for Strangford (Jim Shannon), who directly asked whether there was a contract between Arklow and Seaborne. Is not it the case that the Secretary of State knows full well, as reported in The Irish Times today, that there were numerous discussions between Seaborne and Arklow, but there was no contract or even formal agreement in place—and yet he went ahead?
Chris Grayling
I do not think that Opposition Members are listening at all to what I have said. The agreements were all in place and ready to be signed, but the reality is that, at this moment, Arklow took a step back and did not want to continue. We had commitment now, a month ago and at Christmas time that Arklow was backing this proposal, but to be on the safe side—to be sure—we set up a contractual structure that meant that the taxpayer had no exposure unless the service was delivered. That was the right thing to do.
Wayne David (Caerphilly) (Lab)
Last month, the Secretary of State said to this House:
“We contracted with Seaborne Freight because the service it proposes represents a sensible contingency”—[Official Report, 8 January 2019; Vol. 652, c. 190.]
Given what we now know and with the benefit of hindsight, will the Secretary of State have the humility to come to the Dispatch Box and say sorry?
Chris Grayling
It was a sensible contingency. If we require that capacity now, we will have to use longer routes through the North sea, when it would be better to go from Ramsgate to Ostend. We have the resources, facilities and capacity available to deal with what we have identified as the needs of organisations such as the NHS.
Nic Dakin (Scunthorpe) (Lab)
My hon. Friend the Member for Birmingham, Northfield (Richard Burden) asked the Secretary of State whether, at the point of signing off the contract, he knew that Seaborne Freight had not got in place the agreements with the port authorities in Ramsgate and Ostend that it was saying that it had got. This is about due diligence—was it done?
Chris Grayling
I can only think that Opposition Members have not been listening to a word I have said. I said at the start that we knew that they had not got the arrangements in place. That is why we put in place a tight contractual structure that involved no financial commitment from the taxpayer until they had got those things sorted out.
Martin Whitfield (East Lothian) (Lab)
We have heard today that there was no legal contractual agreement between Arklow Shipping and Seaborne. The Secretary of State has confirmed that the reason for pulling out of this contract was the announcement on Friday. If that is the case—if he only knew about it on Friday—then how can the DFT spokesperson be correct that he is in advanced discussions with other shipping companies?
Chris Grayling
Precisely because, as I said, we already had secured options that would enable us to provide alternatives.
Drew Hendry (Inverness, Nairn, Badenoch and Strathspey) (SNP)
Throughout this ridiculous Brexit shambles, Brexiteers have liked to lean on historical events to justify the metaphors for some of their Brexit fantasies. Was this calamity actually engineered by the Secretary of State, so that he could paint himself as some kind of latter-day Horatio Nelson—“I see no ships”? Well, we see no competence. Will he resign?
Chris Grayling
Actually, I did see ships—they were lined up ready to go on this route. It is a shame the backers pulled out.
Oral Answers to Questions
Lord Grayling Excerpts(5 years, 10 months ago)
Commons ChamberRead Full debate Read Hansard Text Read Debate Ministerial Extracts
Mr Virendra Sharma (Ealing, Southall) (Lab)
The Secretary of State for Transport (Chris Grayling)
The UK Government and European Commission have agreed in principle that the two sides should negotiate a comprehensive air transport agreement. The Department is working closely with the aviation sector to ensure its requirements are factored into negotiations. The Department’s aviation technical notices and the European Commission’s published plans for aviation contingency preparations, alongside proposed EU regulations published on 19 December, clearly demonstrate that, in a no-deal scenario, both sides are committed to maintaining aviation connectivity.
Chris Grayling
I think that the aviation sector will continue to grow and develop as it has in recent years. We will continue to have connections across Europe, as we do at the moment, and, of course, with the plans for the expansion of Heathrow airport, there will be a real opportunity for apprenticeships in the sector and to open up new routes around the world, for example to emerging markets in Asia. I see the next 10 years as ones of great opportunity for the aviation sector.
Sir Desmond Swayne (New Forest West) (Con)
The EU’s contingency arrangements are welcome, but what estimate has the Secretary of State made of the prospects for airports such as Bournemouth that want to increase their routes to Europe over the next year?
Chris Grayling
The European Union has said that it wants to keep flights at the current levels, and I suspect that they will find that that is not a universally held view among member states.
Mr Speaker
Order. I listened to the right hon. Gentleman’s question with great interest. It was tangential to the substantive question, and I just say gently to him that I had been thinking of offering him an Adjournment debate on the matter, until I realised that he had, in fact, just conducted one.
Chris Grayling
Indeed he has, Mr Speaker.
I would simply remind the right hon. Gentleman of two factors. First, the disruptive attack at Gatwick was unprecedented anywhere in the world, and as a result we have been approached by airports around the world to learn more about how we tackled that. Secondly, as I have said, I am not able to discuss in the House the nature of the technology used for security reasons, but when a similar issue arose at Heathrow earlier this week, the response was very rapid indeed.
Colin Clark (Gordon) (Con)
Does the Secretary of State agree that regional air connectivity within the UK is a priority as we leave the EU? Can he remind operators such as British Airways that reducing routes from Aberdeen International airport in my constituency disrupts business and leisure travel?
Chris Grayling
I agree with my hon. Friend, and that is why we have put down a clear requirement that as Heathrow expands a proportion of its capacity is set aside for regional connectivity within the United Kingdom. It is really important that an expanded Heathrow is a gateway for the whole United Kingdom to opportunities around the world, as well as within the country.
Mr Barry Sheerman (Huddersfield) (Lab/Co-op)
I chair the parliamentary air safety group, and I know a little about the aviation sector. During consideration of a statutory instrument upstairs recently, I challenged a Minister to tell me which chief executive or chair of any airline he had talked to about this subject. I have talked to them, and they are terrified of the impact of a no-deal Brexit. He could not name one.
Chris Grayling
I have talked to the chief executives of every major UK airline. I have also talked to representatives of a significant number of international airlines.
Christine Jardine (Edinburgh West) (LD)
As the Secretary of State has spoken to the chief executives, he will of course be aware of their concerns about the contingency agreement only allowing for a freeze in the services of British airlines as they stand at the moment . What reassurances can he give airports such as Edinburgh that this will not in fact be the case, and that expansion will happen should we have to leave the EU?
Chris Grayling
The hon. Lady says, “should we have to leave the EU”. The country has already voted to leave the EU and we will next week vote on an agreement that would continue current aviation arrangements. If she is concerned about the contingency plans put in place by the European Union, will she join the Government in the Division Lobby next week to support the agreement?
Jim Shannon (Strangford) (DUP)
Can the Secretary of State further outline discussions held with Belfast City and Belfast International airports to secure enhanced trading routes post March, and to evaluate what changes the airports may have to make?
Chris Grayling
I have had regular conversations with the leadership of the Belfast airports. Working with them in several areas, I want to see them expand their international flights. More flights are, of course, being planned for next summer, and I hope and believe that they have a strong and prosperous future with better links around the world.
Karl Turner (Kingston upon Hull East) (Lab)
The Prime Minister’s deal looks dead and we could well be heading into the chaos of a no-deal Brexit. If that is the case, we will no longer be a member of the European Aviation Safety Agency. Given that we do not currently have a bilateral air safety agreement with the US, can the Secretary of State give a guarantee that in the event of no deal there will be no disruption to flights?
Chris Grayling
Yes. The Civil Aviation Authority has been working for well over a year to ensure that in the event that we do not continue as a member of EASA we have a properly functional British alternative.
Alex Cunningham (Stockton North) (Lab)
Sandy Martin (Ipswich) (Lab)
The Secretary of State for Transport (Chris Grayling)
The Department has been working for some time to ensure that traffic can continue to flow through UK ports as frictionlessly as possible in all scenarios when we leave the European Union. This has included engaging closely with others across Government, and with ports and their representative bodies. As regards ferry capacity, I refer the House to the two statements I made earlier this week.
Tommy Sheppard
The Government will forgive the House some scepticism about their efficacy and intention in this regard. Surely the Seaborne fiasco shows that only one of two things can be happening: either there is abject incompetence in the preparations for no deal; or the Secretary of State and his Department are not really taking them seriously. Which is it?
Chris Grayling
What is disappointing is that I would have hoped that the hon. Gentleman, as a Scottish Member, would welcome the additional opportunities for Scottish business as a result of expanded services from east coast ports to northern Europe provided by DFDS, which is a very substantial part of the contracts that we have let.
Martyn Day
Seaborne Freight has negative equity of just over £374,000, with one director being investigated by the Government for a trail of debt related to previous companies, yet due diligence did not flag this up. Can the Secretary of State confirm whether that is because due diligence guidance was to look not at individuals’ trading history, but only at Seaborne’s proposals? Why was such guidance provided?
Chris Grayling
As I said in the House earlier this week, we will not be paying Seaborne until ferries operate. From the point of view of business in Scotland, we have made sure that there are additional routes available from the east coast ports to northern Europe. In the event of a no-deal Brexit, which I hope will not happen, that should be a really valuable alternative for Scottish business, and the hon. Gentleman should welcome that.
Sandy Martin
How long has the Minister’s Department estimated it will take to recruit and train the thousands of additional customs officers who will be required if we leave without a deal, and what conversations has he had with Her Majesty’s Revenue and Customs about this?
Chris Grayling
I am very confident, as I have said, that HMRC will be ready. Of course, the point is that, at the moment, we do not collect customs tariffs or carry out checks. The Government have said very clearly that our prime priority in a post-Brexit world will be the fluidity of trade; other things can follow. Security, of course, remains of paramount importance, but beyond that, other things can follow. That is the approach the Government have taken.
Stephen Crabb (Preseli Pembrokeshire) (Con)
I have two ports in my constituency, with ferry connections running from Milford Haven and Fishguard to Ireland. Those ports assure me that they have the skills and the capacity to handle a variety of Brexit scenarios, but all they see at the moment is the promise of further argument and gridlock in this place. Does my right hon. Friend agree that we have a duty in this House to provide a way forward for this industry? Those who take comfort in just opposing everything are failing in their responsibilities.
Chris Grayling
I agree with my right hon. Friend. The reality is that it is all well and good Labour Members saying, “We don’t want no deal,” but then they are going to vote against the deal. They have not come up with any credible alternative plan, so I am afraid I take with a very large pinch of salt most of what the Labour party says at the moment.
Mr Philip Hollobone (Kettering) (Con)
Will the Secretary of State confirm to the House that the Government have signed the common transit convention, which means that, in the event of a no-deal Brexit, customs declarations and import duties, as now, will be required to be paid only when the goods arrive at their final destination?
Chris Grayling
That is absolutely correct. In very many international trading scenarios using the common transit convention, customs processes can be at the start and the end of the journey. That is one reason why I felt able to say to the House earlier this week that I was confident that, in all circumstances, trade would continue to move relatively freely.
Lilian Greenwood (Nottingham South) (Lab)
It has been reported that the Secretary of State’s Department is in talks with two rail freight companies about options to provide additional services via the channel tunnel and High Speed 1 to ensure supplies of food and medicines in the event of blockages at Kent ports. It is also claimed that the Department has written to Southeastern trains warning of possible disruption to its services if additional daytime freight movements are required. Is his Department really contemplating emergency rail timetables in the event of a no-deal Brexit? Has he written to Southeastern regarding such contingency plans? Should the many thousands of rail commuters in Kent be bracing themselves for possible disruption?
Alan Brown (Kilmarnock and Loudon) (SNP)
The Secretary of State’s responses in Tuesday’s urgent question on the Seaborne fiasco were disgraceful. He has awarded an emergency ferry contract to a company with no boats, no ports agreement, no personnel, debts and key personnel with dubious trading pasts. Parliament needs answers. How was Seaborne identified as a company that merited direct negotiations for an emergency contract?
Chris Grayling
It is a bit like the proverbial stuck gramophone record. I said very clearly, earlier this week, that we have let contracts with a number of operators, of which Seaborne represents about 10%, and we pay no money unless the service is delivered. To clarify further what the Chair of the Transport Committee said a moment ago, we are talking to a number of other potential outlets, in case extra capacity were to be needed—rail, ports, maritime—but nothing else has been decided. We have not issued instructions to any rail company about disruptive timetables and we have not taken any further steps to put additional measures in place. We are simply checking the lie of the land so that we can respond to all eventualities.
Alan Brown
This is an emergency contract that the Secretary of State thought was so critical it could circumvent EU procurement rules for direct negotiation, yet he says, “It’s only 10%” and “Don’t worry, if they don’t deliver, they don’t get paid.” That means they don’t deliver that emergency service. We know how sensitive Dover is; there are predictions of delays that could lead to 30-mile queues. If that 10% is not delivered, what is the impact on Dover?
Chris Grayling
This is why 90% of the new contracts are with DFDS and Brittany Ferries. As I said, I am disappointed that the Scottish National party does not welcome the DFDS contract that will provide additional routes from east coast ports to northern Europe, which will be beneficial to Scottish business.
Andy McDonald (Middlesbrough) (Lab)
Putting to one side the ridiculous and desperate allegations of the Secretary of State that Labour is anti-business and his banal allegations over Brexit, I point out that the Seaborne fiasco lays bare his total incompetence and the complete failure of due diligence. Before granting the ferry contract, was he aware of the debt or the promissory note between Ben Sharp, now Seaborne’s CEO, and Mid-Gulf Offshore, acknowledging Sharp’s indebtedness to that company of over $1 million, which remains unpaid?
Chris Grayling
That clearly got under the hon. Gentleman’s skin because he really does not like Government supporting new start-up businesses. The reality is, as I said earlier this week, that due diligence on this contract was done by Slaughter and May, Deloitte and Mott MacDonald, as he would expect, and off the back of that we formed a contract which we pay nothing for until the service is delivered.
Andy McDonald
Here’s another one the Secretary of State might not answer. As a result of this debacle, a variety of legal challenges to the Secretary of State may well flow from, among others, existing freight service providers with capacity. On Tuesday, he said that Seaborne will be able to run ferry services immediately, but on Wednesday the Government said that Seaborne will not be able to open the route between Ramsgate and Ostend until late April at the very earliest. Surely that puts Seaborne in default of its contract to deliver services from 29 March and the contract is therefore void. In those circumstances, should not he reverse his appalling judgment and cancel the contract without delay?
Chris Grayling
We will hold all the companies that have presented us with proposals to the terms of their contracts.
Luke Pollard (Plymouth, Sutton and Devonport) (Lab/Co-op)
Ruth Cadbury (Brentford and Isleworth) (Lab)
The Secretary of State for Transport (Chris Grayling)
As the hon. Lady will be aware, the airports national policy statement requires 50% of passengers to use public transport by 2030, rising to 55% by 2040. It also requires 25% fewer staff car trips to work by 2030, and 50% fewer by 2040. In addition, I expect Heathrow to meet its public pledge of no greater airport-related road traffic.
Ruth Cadbury
The terminal 5 inspector recommended that that expansion should be dependent on additional rail access, and we have seen the consequences locally of that not having happened. The Department for Transport’s own figures say that a third runway will put an additional 54,000 vehicles a day on our local road system. Will the Secretary of State make any further expansion at Heathrow conditional on western and southern rail access?
Chris Grayling
I want to go further than that. Western rail access is currently in development and we are in the early stages of preparation for southern rail access. We are also making provision at Old Oak Common for a Chiltern connection into that station that will provide a link into Heathrow. High Speed 2, of course, will arrive at Old Oak Common and deliver an opportunity to connect into Heathrow from a different route. Finally, it is my hope that the Mayor of London will, notwithstanding the financial challenges at Transport for London, deliver the Piccadilly line upgrade, which is so important.
Justine Greening (Putney) (Con)
The terminal 5 planning conditions, set as part of its go-ahead, were that there would be no third runway and that there would be a legal limit of 480,000 flights a year. Now, of course, we are getting a third runway, and last week Heathrow asked—and, I presume, will be granted—permission to go beyond its 480,000-flight cap. Is not the reality that any assurances—legal, ministerial or public pledges from Heathrow—are utterly meaningless?
Chris Grayling
My right hon. Friend has made her point succinctly. She will understand, though, that if an application comes forward from Heathrow to change the current rules, it would be wrong of me as Secretary of State to pass comment one way or the other at the moment.
Andy Slaughter (Hammersmith) (Lab)
The Secretary of State has mentioned the Piccadilly line upgrade, but he knows that that—and, indeed, Crossrail—is there to cope with existing and future passenger demand, and not Heathrow expansion. Given that we know that Heathrow, as always, will do nothing to cope with the problems that it causes, what will the Government do when there is this massive increase in passengers, a 50% increase in flights and no capacity on those lines to deal with those?
Chris Grayling
Even an expanded Heathrow is forecast to need only 6% of capacity on the Piccadilly line and, as I said a moment ago, we are already moving ahead with western access and starting the process of southern access. I am making provision for a Chiltern route into Old Oak Common, connecting to Heathrow by Crossrail, and HS2 will come to Old Oak Common as part of the first phase of that project. I think we are doing rather a lot to prepare for surface access to Heathrow.
Damien Moore (Southport) (Con)
Liz McInnes (Heywood and Middleton) (Lab)
The Secretary of State for Transport (Chris Grayling)
May I begin by extending the condolences of the whole House to the family of Lee Pomeroy, who was tragically murdered on a train in Surrey last week? I pay tribute to the three members of staff who dealt with the tragic situation and all the British Transport police who responded to it; they all acted with great bravery. While I am talking about bravery, let me also pay tribute to the British Transport police officer who was stabbed in Manchester during the terrorist incident a few days ago.
Liz McInnes
I thank the Secretary of State for that answer and share his sentiments about the terrible attacks on our trains recently.
On 2 January I was at Castleton station in my constituency, watching train cancellation after train cancellation as my constituents were trying to get back to work after the new year break. Does the Secretary of State think that it is fair to hit rail passengers with an above-inflation rise in fares, given the clear decline in punctuality and reliability, and worsening overcrowding on our trains?
Chris Grayling
We have set a limit in line with inflation for the increase in regulated fares. Transport for the North and the Rail North Partnership have additional financial resources from the compensation package provided last summer that they can use on lines that continue to be affected by underperformance if they choose to do so. I would be very happy to see them do that.
Andrew Rosindell (Romford) (Con)
Mr Virendra Sharma (Ealing, Southall) (Lab)
Chris Grayling
I do not have the costs immediately to hand. However, the point about Operation Brock is that it is designed to replace Operation Stack and provide a solution well into the early 2020s in the case of disruption at the channel ports, which I do not want to see. To do the work on the M20 and the work that has happened on the M26, the cost is in the low tens of millions of pounds, but I will be able to give the hon. Gentleman an exact number. It is really important that we do not see a repeat of the disruption of 2015 in Kent.
Ms Esther McVey (Tatton) (Con)
Knutsford commuters have been repeatedly promised an upgrade to the Knutsford to Manchester line to two trains an hour. However, after excuses and procrastination, that is now not happening at the time it was meant to happen. It is unacceptable to have such an unreliable and irregular service for such a busy part of the country. Will the Secretary of State intervene, speak to Northern, speak to Network Rail, and get this promise fulfilled?
Deidre Brock (Edinburgh North and Leith) (SNP)
Chris Grayling
This is really an issue for the Spanish and Irish Governments; it does not affect British Airways at all, as it will be covered by the transitional arrangements as well as by the international agreements we have in place. It is an issue for Iberia and for Aer Lingus, which will clearly want to carry on flying within the European Union.
Mr Philip Hollobone (Kettering) (Con)
I declare my interest as a member of Kettering Borough Council. What further progress is being made by the roads Minister and his team towards tabling the statutory instrument to facilitate the decriminalisation of parking in Kettering?
Hannah Bardell (Livingston) (SNP)
Chris Grayling
First, let us be clear: there is no perfect, off-the-shelf system available to airports that will simply deal with this problem overnight. I pay tribute to those in the police and the military, and across government, who responded so quickly to the Heathrow problem, ensuring that the runway was closed for a very short length of time, and to the team at Heathrow who did the same.
Maggie Throup (Erewash) (Con)
Now that the consultation on the High Speed 2 working draft environmental statement has closed, has the Minister had any indication of when HS2 Ltd will publish its response? Can she ensure that every submission will be given careful consideration?
Justine Greening (Putney) (Con)
Heathrow flight paths go over the most densely populated part of our country—London communities. Drones are a clear public safety risk, as things stand. Does the Secretary of State agree that we should review the decision to further expand Heathrow and have more flights over more communities, on public safety grounds?
Chris Grayling
I am afraid I do not agree with my right hon. Friend. Airports in this country and around the world are now working intensively to ensure they can deliver technology that will deal with this issue. That needs to be done long before we ever get to the point of expanding Heathrow airport.
Kirsty Blackman (Aberdeen North) (SNP)
How much additional funding will the Department require in the 2019-20 financial year in the event of no deal, and has the Treasury approved that?
Chris Grayling
We have an allocation of funding for next year, but almost all our expenditure has taken place within the current year—it is in the region of £70 million. That is the prime amount we are spending. In the next financial year, if we require some of the contingency capacity to which I have committed, there will be a cost. As the House is aware, the maximum that we have contracted for is £103 million.
Anna Soubry (Broxtowe) (Con)
Can the Secretary of State give us an update on the midland main line delayed franchise? As he knows, I am very grateful for the conversation we have had. Stagecoach has taken out £35 million of profit, and it appears to be running down an otherwise excellent system. Can he tell us when the franchise will be awarded?
Chris Grayling
The slight delay to the issuing of the new franchise is for complex reasons related to rail pensions. I have noted the issues that my right hon. Friend has raised. I am concerned about it. It would be unacceptable for any current franchisee to run down the franchise in the run-up to renewal, and a strong message is being sent to the company that, if that is happening, it has to stop right now.
Meg Hillier (Hackney South and Shoreditch) (Lab/Co-op)
It is not clear to me what the unforeseeable emergency was that allowed the Secretary of State to award the contract to Seaborne Freight outside the rules. Did he receive explicit legal advice about that, and if so, will he consider publishing it?
Chris Grayling
We are confident that this was a proper procurement process, handled by the procurement team in my Department in the normal way.
Several hon. Members rose—
Seaborne Freight
Lord Grayling Excerpts(5 years, 10 months ago)
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Andy McDonald (Middlesbrough) (Lab)
(Urgent Question): To ask the Secretary of State for Transport if he will make a statement on the awarding of a contract to Seaborne Freight as part of his no-deal contingency planning.
The Secretary of State for Transport (Chris Grayling)
The Government are working towards ensuring that we leave the European Union in March with a sensible agreement for the future, through the withdrawal agreement that the House will consider next week, but any responsible Government need to plan for all eventualities. As part of that work, the Department for Transport has been undertaking a wide range of activities to mitigate the impact on the transport system of a potential no-deal EU exit, particularly around the movement of freight. For example, my Department has been delivering measures such as the Haulage Permits and Trailer Registration Act 2018, which puts systems in place if a permit system is required to ensure that UK heavy goods vehicles can continue to be used in the EU.
We have also put in place Operation Brock as a replacement for Operation Stack, in order to deal with disruption at the channel ports. This is not simply a Brexit-related measure. We do not want to see any repeat of the issues that Kent faced in 2015, with the closure of the M20. If there is any disruption at the ports, for whatever reason, Operation Brock should keep the motorway open while we prepare the long-term solution of a lorry park. Yesterday, Kent County Council and my Department carried out a live trial of one part of Brock, on the route from Manston. We were satisfied with the number of vehicles that took part, which was more than enough to determine a safe optimum release rate from Manston to the port of Dover via the A256 and caused minimal traffic disruption along the route.
This is a range of examples of the sensible contingency planning that a responsible Government are carrying out to ensure that we are prepared for a range of outcomes. We remain committed to ensuring that movement across the UK border is as frictionless as possible, whatever the outcome. However, without planning, there could be significant disruption to the Dover strait, particularly if no agreement is reached. Given the importance of these routes to the UK economy, it is vital that we put in place contingency plans to mitigate any disruption that might occur in a no-deal scenario.
The Department is working with the port of Dover and the channel tunnel—as well as with our French counterparts, at both official and ministerial level—to ensure that both operate at the maximum possible capacity in all instances. Those discussions are positive and I am confident that everyone is working constructively to ensure that the Dover-Calais route—particularly at the port of Dover—and the tunnel continue to operate fluidly in all scenarios. However, in order to ease any pressure on those routes, my Department has completed a proper procurement process to secure additional ferry capacity between the UK and the EU. Following this process, three contracts were awarded to operators, totalling a potential of £103 million. Almost 90% of that was awarded to two well-established operators: £46 million to Brittany Ferries and about £42 million to DFDS. These contracts provide additional capacity on established routes, and through additional sailings and, in some cases, additional vessels, into ports in northern Europe and other parts of France.
A third, smaller contract, which is potentially worth £13.8 million, was awarded to Seaborne Freight, a new British operator, to provide a new service between the port of Ramsgate and Ostend. Let me stress that no money will be paid to any of these operators unless and until they are actually operating ferries on the routes we have contracted. No money will be paid until they are operating the ferries. No payment will be made unless the ships are sailing, and of course, in a no-deal scenario, money will be recouped through the sale of tickets on those ships.
As I believe the House knows, Seaborne is a new operator looking to reopen that route, which closed five years ago. As a result of this, we ensured that its business and operational plans were assessed for the Department by external advisers, including Slaughter and May, Deloitte and Mott MacDonald. These included Seaborne’s plans to charter vessels for service, as is common across many transport modes including airlines and rail operators. We also conducted searches on the directors of Seaborne via a third party, and found nothing that would prevent them from contracting with the Government.
I make no apology for being willing to contract with a new British company, particularly one that has a large number of reputable institutional backers. We contracted with Seaborne Freight because the service it proposes represents a sensible contingency in the event of disruption on other routes. I am also pleased that this award supports the port of Ramsgate, which operated as a commercial ferry port as recently as 2013 and has taken roll-on roll-off services as recently as last year. I am looking forward to seeing ferry services resume from this port. The infrastructure work required to make that possible has already started, and it is one of the most visible and symbolic elements of how seriously my Department is taking contingency planning for all Brexit eventualities.
Andy McDonald
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. Two of Seaborne Freight’s directors would not pass normal due diligence requirements. One of them, Ben Sharp, is already under investigation by a Government Department. Did the Department for Transport consult other Departments about Mr Sharp’s fitness as a company director? Ben Sharp quit his business activities in the Gulf leaving a trail of debt behind him. His company, Mercator, was merely a shell finding vessels for security companies. Is it correct that he operated without the licence he needed pursuant to the Export Control Order 2008? Did he operate without that licence? Yes or no?
It is abundantly clear from the promissory note published by “Channel 4 News” that Sharp owed and still owes Mid-Gulf Offshore more than $l million, and many more companies besides. How is it that Slaughter and May, Deloitte and Mott MacDonald were instructed to restrict their due diligence examination to the face value of the presentation put to them by Seaborne? Why on earth have they been allowed to restrict their investigation to the present company and not to consider the trading history of the individuals concerned, particularly Ben Sharp? The mayor of Ostend has made it clear that Seaborne cannot berth at his port as it has no bank guarantees and no contract with Ostend. It is without capital. Who is investing in Seaborne? Who is paying for the dredging of Ramsgate?
This is a shoddy and tawdry affair, and the Secretary of State is making a complete mess of it. This contract is likely to be unlawful and it violates every current best practice guidance issued by Whitehall. 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?
Chris Grayling
I am not even going to address the idiocy that the hon. Gentleman has just come up with. He has made a number of allegations, which I suggest he goes and makes elsewhere. I am simply going to say this: the Government have let a contract for which we will pay no money until and unless ferries are running. That is responsible stewardship of public money. On other matters, from the due diligence we have done, there is no reason to believe that anyone involved in this business is not fit to do business with the Government. I say this again: we are not spending money unless these ferries operate.
Mr Owen Paterson (North Shropshire) (Con)
Many of us would agree that much the best end solution for the talks between the Government and the EU would be a wide-ranging free trade agreement, as offered by President Tusk in March, with zero tariffs. However, to bring the EU to the table, to counter the arrogant boasting of Mr Selmayr in the Passauer Neue Presse, which many of us have been reading since we heard about it yesterday, and to show that we are deadly serious, it is obvious that we must prepare for World Trade Organisation terms. I therefore commend the Secretary of State for his various actions to show that we are serious about preparing this country to work under those terms, through which we work with the rest of the world.
Chris Grayling
I am grateful to my right hon. Friend. It is absolutely right and proper that we prepare for all eventualities. The sad thing is to see the Labour party trying to destroy Brexit and taking a destructive approach to any sensible measures that this Government take to prepare for all Brexit eventualities. Frankly, Labour is not fit to be in opposition let alone in government.
Alan Brown (Kilmarnock and Loudoun) (SNP)
Seaborne Freight has no boats, negative equity of £374,000 and no history of running ferry or freight services. The current director, Brian Raincock, and chief executive Ben Sharp both had companies liquidated owing Her Majesty’s Revenue and Customs money, with Raincock’s debt at £600,000. HMRC is us, the taxpayer, so what constitutes due diligence? What red flags were identified? How did that company get handpicked for direct negotiations for operating out of a port that is not even ready?
The Secretary of State’s written statement indicated that direct negotiation was possible under regulation 32 of the Public Contracts Regulations 2015, which relates to emergency situations brought about by unforeseeable events. However, the Government claim to have been planning for no deal for over two years. What legal advice was provided? What level of madness exists to contract contingency planning to a company with no track record of such service?
Saying that the company will get paid only if it can deliver misses the point, because if it does not deliver the so-called emergency contingency service, that would leave us high and dry. Is that the project for which the ministerial direction was required? Is there a central Government instruction and process for the awarding of such no-deal Brexit contracts? If so, can we see it? Does this contract comply with that guidance? If so, that highlights the shambles of this Government’s no-deal preparations. When will the Secretary of State do the right thing and go?
Chris Grayling
This procurement was done properly and in a way that conforms with Government rules. It secures the position of the taxpayer by ensuring that no money will change hands unless and until the ferries are running. The hon. Gentleman does not seem to listen.
Sir Bernard Jenkin (Harwich and North Essex) (Con)
I join my right hon. Friend the Member for North Shropshire (Mr Paterson) in supporting my right hon. Friend the Secretary of State’s determination to be prepared for all eventualities. He has succeeded on aviation services, the transit convention and other things that will ensure that trade keeps flowing. However, what lessons can be learned from this situation? No matter how good this company might be, this is a difficult contracting environment in which things must be done quickly under intense political and public scrutiny. Will my right hon. Friend ask the permanent secretary to conduct a quick lessons-learned exercise so that companies with which the Government are contracting are better prepared than this one for the scale of public scrutiny to which it has been subjected?
Chris Grayling
My hon. Friend makes a valid point about public scrutiny. This contract was properly signed off by my Department’s accounting officer, and it was done in the best possible way when dealing with a new business, which is to ensure that the business will be paid only when it delivers the service. That is a responsible use of taxpayers’ money.
Lilian Greenwood (Nottingham South) (Lab)
I have already written to the Secretary of State with a long list of questions about his Department’s procurement of additional ferry services as part of no-deal planning, and I look forward to receiving his response. Yesterday, however, Lloyd’s Loading List reported some extraordinary remarks from the CEO of Seaborne Freight, Jean-Michel Copyans, about the proposed Ramsgate to Ostend route. He said:
“Then we’ve had to identify the vessels best suited to the type of crossing, which we’re keeping a secret for the moment.”
With no crew, no signed contracts in place with Ramsgate or Ostend, no clear plans to bring the infrastructure back into service and now “secret” ships, is there not a huge question mark over the deliverability of the service?
Chris Grayling
My officials and I have confidence in the deliverability of the service, but if the firm fails to deliver it, we do not pay.
Charlie Elphicke (Dover) (Con)
Does my right hon. Friend agree that no-deal contingency planning is very much in the national interest? Will he join me in condemning those who want to try to prevent no-deal planning through parliamentary wrecking tactics and sabotage, and through Trump-style Government shutdown threats? Does he agree that such tactics from the Labour party would make problems in Kent and elsewhere more likely, and that they are irresponsible, reckless and wrong?
Chris Grayling
I completely agree with my hon. Friend. He will agree that it is right and proper that we do everything we can to keep trade flowing through the port of Dover and the channel tunnel as smoothly as possible. We are taking prudent measures to ease potential pressures on those ports, which is the sensible thing to do. The risk to the taxpayer is not there, because we will not pay unless the service is delivered. The Labour party does not seem to believe in no-deal Brexit planning.
Hilary Benn (Leeds Central) (Lab)
The Secretary of State takes a rather unusual approach to contract letting, because as soon as he is questioned about the ability of the firm with which he has contracted to deliver on what it has promised, he tells the House, “If they don’t do it, we won’t pay.” He said a moment ago that he is confident that the company will be able to run the service, so will he answer a very simple question? Has Seaborne Freight told the Department which vessel it has acquired in order to provide the service, which could be needed in just over two months’ time?
Chris Grayling
The company has told my Department in great detail about its plans, which are being finalised commercially. We are confident that the firm will deliver the service.
Sir Nicholas Soames (Mid Sussex) (Con)
My right hon. Friend will be aware that Seaborne Freight has had it in mind for well over two years to start the Ostend-Ramsgate route. Does he agree that the constant denigration of the contract, which means that the contractor will not get a single penny of anyone’s money until it fulfils the contract, is damaging to sensible work? Finally, if we were—God forbid—to crash out on WTO terms in the extreme circumstances mentioned by my right hon. Friend the Member for North Shropshire (Mr Paterson), will the Secretary of State tell the House whether he would have any arrangements to take up shipping from trade?
Chris Grayling
My right hon. Friend makes a good point. There seems to be visceral hatred of small business on the other side of the House and a visceral belief that the Government should not be willing to contract with small business. The Government are told time and again that we should contract and work with small business, and help small businesses to develop, but when we do so, we get nothing but a wall of criticism from Opposition Members. The Labour party hates business. This new Labour party is very different from the one of 10 years ago—it simply hates business.
I say to my right hon. Friend that if we find ourselves in a no-deal situation, there are other measures that we can bring forward. We are actively looking at how we would do so.
Diana Johnson (Kingston upon Hull North) (Lab)
I have never seen a Minister bluster and bluff quite as much as this Minister has today. Following everything that the Secretary of State has heard from the shadow Secretary of State and the Chair of the Transport Committee, does he not have one iota of concern about the contract being let to this shyster?
Chris Grayling
Mr Speaker, that is an inappropriate thing for any Member to say, and I am not going to respond to it.
Mr Speaker
I simply say that the Secretary of State is perfectly entitled to his assessment of whether it is appropriate in political terms. No breach of order has taken place procedurally, but the Secretary of State has made his judgment, and I accept that.
Dr Sarah Wollaston (Totnes) (Con)
I am glad to hear the Secretary of State confirm that no money will change hands, but there will undoubtedly be vast manpower and bureaucracy costs in no-deal planning, and we know that there are actual costs when it comes to commissioning refrigerated warehousing and special air freight. All that could be avoided if the Government ruled out no deal. No deal would be catastrophic, and no sensible Government should inflict that on their people.
Chris Grayling
Of course, the best way of avoiding no deal is to ensure that the deal passes through this House, and I will vote for it next week.
Angus Brendan MacNeil (Na h-Eileanan an Iar) (SNP)
It feels like we are on the set of a film called “Carry On Brexit”. Le Figaro described the contract as ferries “sans bateaux”. The firm’s terms and conditions are from a pizza delivery company, so we wonder whether the MV Hawaiian and the MV Pepperoni will be sailing the route. To get away from “Carry On Brexit”, the serious point is that the Secretary of State is saying that if the company does not deliver ferries, there will be no payment, but if it does not deliver the ferries, what will be the fall-back, stopgap or contingency? If there are no ferries, the whole thing falls apart—it is “Carry On Brexit”!
Chris Grayling
What a load of absolute tripe. I can tell the hon. Gentleman has not been listening to me. Ninety per cent. of this contract has been awarded to substantial and established ferry operators—DFDS and Brittany Ferries. We did not have a reason to exclude a small business from taking a small part of the contract with a legitimate, valid bid.
Craig Mackinlay (South Thanet) (Con)
It is remarkable, is it not? If the Government were to do no planning for all Brexit eventualities, they would be condemned. Now they are doing sensible planning, they face derision. I have met Seaborne Freight, which has shown itself, over a number of years, to be the only party interested in running new services between Ramsgate and Ostend—that was even before this contingency planning. Personally, I welcome the dredging and improvements now taking shape at the port of Ramsgate at no cost to local taxpayers. We will have a regeneration bonus, no matter what, and I welcome that.
Thanet District Council and the people of Ramsgate will do all they possibly can for Brexit provision, so I welcome the measures the Secretary of State has taken, but there are people in this House who do not seem to be listening. Will he say once more that there will be no cash for Seaborne Freight if it does not run the services?
Chris Grayling
I am very happy to reiterate that. It is a responsible approach to a new contract with a new business that we will pay when the business delivers. It is disappointing to hear that the Labour party is so opposed to the regeneration of the port of Ramsgate. It was not so long ago that the Labour party represented Ramsgate in Parliament but, given this negative attitude, it does not deserve ever to do so again.
Luciana Berger (Liverpool, Wavertree) (Lab/Co-op)
One of the directors of Seaborne Freight has been named by the Financial Times as Brian Raincock, whose previous company went into liquidation in April 2017 owing £585,000 to its main creditor, HMRC, which is essentially the British taxpayer. Is the Secretary of State content that this excruciating fact apparently did not come up during his Department’s due diligence on Seaborne Freight before it awarded the contract? Whether or not Seaborne Freight delivers the ships, it has still been awarded a £14 million contract, so hon. Members on both sides of the House rightly have an issue with the Secretary of State and his response today.
Chris Grayling
I keep telling the hon. Lady that the £14 million will not be paid unless Seaborne Freight delivers a service. I will not comment on the tax affairs of an individual, and nor should she. The due diligence on all those participating in the company found no reason why they are unfit to do business with the Government.
James Duddridge (Rochford and Southend East) (Con)
I congratulate the Secretary of State on his detailed preparations, but will he also consider how south Essex can support those preparations at Tilbury, London Gateway and London Southend airport? London Southend airport has experience of just-in-time delivery to Dagenham and is run by Stobart Group, an excellent freight haulage firm.
Chris Grayling
I absolutely agree. Of course, if we find ourselves in a no-deal scenario, a number of other ports, including Tilbury, will play a part. I hope we do not reach that point, and I think we all agree that we want a sensible free trade agreement with the European Union after 29 March, but the reality is that we need to make sure we are prepared for all eventualities. In such a situation, many of our ports up the east coast and along the south coast will play an important part in making sure that trade flows freely.
Joanna Cherry (Edinburgh South West) (SNP)
I am very concerned about the legality of this procurement process. In his statement yesterday, the Secretary of State said that he had proceeded under regulation 32 of the Public Contracts Regulations 2015, which allows the Government to circumvent the normal, transparent and EU-mandated procedures. I have a copy of the contract notice here, which is freely available on the internet, and it says that the basis for proceeding under regulation 32 is “extreme urgency.” As my hon. Friend the Member for Kilmarnock and Loudoun (Alan Brown) said, the idea that no deal is a possibility and, to quote the Prime Minister, that no deal is better than a bad deal has been around for some time, so how can the Government, at this late stage, justify proceeding with procurement that is appropriate only in the case of extreme urgency?
I have two questions for the Secretary of State and, just for once, my constituents would like to hear an answer. First, will he release the legal advice that permitted him to proceed under regulation 32? Secondly, as he will be aware, if he has proceeded wrongly under regulation 32, his Department and the Government are open to legal action. How much money has been set aside for the contingency of court action about the illegality of the procurement process and a claim for damages?
Chris Grayling
It is my view that, as we move towards leaving the European Union, preparing for all eventualities is a matter of extreme urgency, which is also the advice that my Department has received and has given to me.
Mr Steve Baker (Wycombe) (Con)
If Opposition Members had an ounce of sense and concern for the national interest, they would welcome the fact that the Department for Transport is preparing to leave the European Union under all circumstances and they would recognise the courage of the Secretary of State, his Ministers and his officials in testing and operationalising their plans. Does he share my disbelief at the policies that are being urged on him by Opposition Members, and will he reassure me that he will continue his excellent work to prepare this country for leaving?
Chris Grayling
I am very grateful to my hon. Friend for his comments. I give him an absolute assurance that I will continue that work. Frankly, the tragedy is that the Labour party seems to have abandoned interest in the national interest.
Tom Brake (Carshalton and Wallington) (LD)
The train timetable fiasco, the drone disruption, the Manston lorry park carry-on and, now, ferrygate—the Secretary of State is the embodiment of the Peter principle.
On the earlier point about competition, can the Secretary of State explain the
“extreme urgency brought about by events unforeseeable by the contracting authority”?
Can he explain what was unforeseeable about no deal, for which the Government have been planning for the past couple of years and to which they have referred many, many times in this place? What was unforeseeable about that?
Chris Grayling
Sadly, what was unforeseeable is the attitude of many hon. Members, mostly Opposition Members, towards the Prime Minister’s sensible agreement. The agreement meets all their requirements, and they are now saying they oppose it anyway.
Mr Simon Clarke (Middlesbrough South and East Cleveland) (Con)
The shadow Secretary of State and I both represent Middlesbrough, which voted overwhelmingly to leave, so I found his comments attacking the Secretary of State for making robust preparations for no deal very surprising.
Will the Secretary of State commit to engaging Teesport in the preparations for any scenario that may arise from Brexit? It is important that we make all the preparations required for all contingencies.
Chris Grayling
I am very grateful for my hon. Friend’s comments. I reiterate that we are looking to involve other ports across the country as we make preparations for an eventuality that I hope will not happen. The reality is that the people of Middlesbrough voted clearly to leave, and they will not understand why the hon. Member for Middlesbrough (Andy McDonald) is letting down their 2016 vote.
Mr Chris Leslie (Nottingham East) (Lab/Co-op)
If this contract fails, our country will have even greater problems with the continuity of trade, so it will be the public who pay the price—it will not be just the central contractor that loses money.
I seek a bit of accountability from the Secretary of State. The front page of today’s Financial Times says that the Department for Transport commissioned a study showing that just an extra 70 seconds of analysis or discussion of each truck crossing the channel could lead to a six-day queue for vehicles getting on a ferry. Has he seen that study? Is the study accurate, and will he publish it now?
Chris Grayling
We have made it very clear to the House that queues will be caused if the French seek to impose maximum control and put in place limited checks. Why on earth does the hon. Gentleman think we are putting some of these contingency measures in place? He asked what happens if the contract does not go ahead, but I have said that 90% of the extra capacity is being provided by two established operators that will continue to deliver the services we have contracted.
Bob Stewart (Beckenham) (Con)
Will my right hon. Friend reassure the House that the Port of Dover and Eurotunnel are making detailed contingency plans in case of no deal?
Chris Grayling
I give my hon. Friend that assurance. We are working with both organisations, and we are also having detailed discussions with the French. The leadership in Nord-Pas-de-Calais and Paris, and the leadership of the port and the tunnel on the French side, are as keen as we are to see fluidity continue through those ports. We are taking contingency measures, but our prime focus is on making sure that trade flows freely, whatever checks are required.
Alison Thewliss (Glasgow Central) (SNP)
The Transport Secretary’s colleague the Home Secretary has been trying to stop people getting across the channel while the Transport Secretary is busy contracting with companies that have no ferries at all. Is his next whizzo move to contract people who are doing people smuggling in dinghies?
Damian Collins (Folkestone and Hythe) (Con)
If there are delays in processing freight through the channel tunnel in my constituency or the port of Dover, is the Secretary of State convinced that his contingency planning means that we will not see a return to Operation Stack and that the M20 motorway will remain open in both directions if there are delays? Will he also update us on when he expects his Department to produce its site list for the potential long-term off-road lorry parking solution in Kent?
Chris Grayling
It is my belief that Operation Brock will prevent the closure of the M20. That is my prime concern—what happened in 2015 should not be repeated. I think there is sufficient capacity to ensure that that will not take place. We have completed the infrastructure works that are necessary on the motorways to ensure that the flow in both directions can continue, and we are now doing the detailed testing to understand flows of traffic and how to manage them to make sure that we do not see the kind of disruption we saw in 2015. I am hopeful that we will move quickly from the consultations we are having now to being able to decide a permanent location and get the thing dealt with once and for all.
Grahame Morris (Easington) (Lab)
Any members of the public watching this debate will be absolutely amazed. They will think it is bizarre that we have a Transport Secretary who signs a shipping contract with a shipping company with no ships. Given that the company is going to hire in ferries, does he have any idea what plans it has to crew its ferries and whether UK crews would be used?
Chris Grayling
There is a complete lack of understanding of business models on the Opposition Benches. Opposition Members should understand that when they go on holiday next summer there is a fair chance they will be flying with an airline that owns no planes. The reality is that transport operators do not always own their own assets; they contract or charter them in and they operate the service. I do not think that Opposition Members understand that. As to the crewing of the ships, that is a matter for the company itself.
Victoria Prentis (Banbury) (Con)
Will the Secretary of State confirm to me that it is normal to award contracts, in a small part, to new operators and that while perhaps 90% of operators used by the Department are established, it is perfectly normal for the Department properly—acting legally as part of its procurement process—to include new operators as part of the consideration?
Chris Grayling
My hon. Friend is absolutely right; that is normal, and we do not actually do enough of it. The Government are frequently criticised for contracting only with big business and not with small business. Ironically, now we are contracting with small business for a small part of a package we need, we are getting criticised for it, so we cannot win either way.
David Hanson (Delyn) (Lab)
Further to the question asked by my hon. Friend the Member for Liverpool, Wavertree (Luciana Berger), will the Secretary of State confirm that one director of this company owes £580,000 to HMRC from a previous failed administration? Will he say what due diligence was undertaken on that contract? Will he also tell us how we are going to repay that money to the Treasury?
Chris Grayling
I am not going to comment on individual tax affairs. All I am going to say is that due diligence was carried out into the participants in this business and no reason was found why they should not contract with Government.
Mr Marcus Fysh (Yeovil) (Con)
It is very reassuring to hear about my right hon. Friend’s discussions with the ports of Dover and Calais and the contingency plans that he is putting in place. Will he tell us more about how companies can get to know what they have to do to make sure that their declarations are appropriately communicated to the port? That seems to me to be a potential pinch point that we need to look at.
Chris Grayling
Certainly one part of the no deal preparations that we are now going through—HMRC is very actively engaged in this—is about the declaration processes that businesses would need to go through. The reality is that this happens already. Goods are shipped from this country to Switzerland, for example, through established processes in this country and on the continent. We will need to ensure in the run-up to a no-deal Brexit that business is up to speed with what it needs to do. A huge amount of work in this respect is already happening.
Sir Mark Hendrick (Preston) (Lab/Co-op)
Things are getting bad when a former Conservative party chair accuses this Government of using Dr Strangelove tactics. This is a perfect example. Instead of trying to prepare for a no-deal scenario, why do the Government not just look at extending article 50 so that we can avoid this catastrophe?
Chris Grayling
Two things: first, I think it would be wrong to block Brexit. Secondly, I think it is right that the Government prepare for all eventualities. They would be accused of being irresponsible if they did not do so.
Helen Whately (Faversham and Mid Kent) (Con)
The view from my constituency, which has the M20 and the M2 running through it, is that we must not have another Operation Stack, so I welcome all contingency measures that my right hon. Friend is taking, but the reality is that whatever happens, the vast majority of our freight will have to continue to go through Dover-Calais. Therefore, the flow of that route is absolutely critical. Will he advise us of how ready the French are to carry out any customs checks that might be required in the event of a no-deal Brexit?
Chris Grayling
We have had detailed discussions with the French. I am very optimistic that they have the same ambition that we do, and they are putting in place plans to ensure that happens. I have had personal commitments from the leadership in Nord-Pas-de-Calais, and of course there is a legal requirement for them put those plans in place, particularly with regard to the tunnel, as the treaty of Canterbury requires them to keep trade and traffic flowing smoothly through the tunnel. I have every reason to believe the French will uphold that commitment.
Richard Burden (Birmingham, Northfield) (Lab)
In April 2018, Seaborne Freight issued in writing an investor briefing that claimed:
“Detailed port agreements with Ramsgate and Ostend negotiated and agreed”,
but it is now clear that no such agreements exist to this day. Indeed, the Mayor of Ostend has given an interview in which he said:
“A start-up in March is simply impossible. There is currently no agreement with Ramsgate and also with Ostend”.
If the Secretary of State has satisfied himself that due diligence checks have been carried out that confirm the suitability of Seaborne Freight to receive a £13.8 million Government contract, will he tell us what weight he has attached to the fact that Seaborne Freight has issued inaccurate investor briefings? Will he also finally answer the question asked by my right hon. Friend the Member for Leeds Central (Hilary Benn), the Chair of the Brexit Committee, and name just one ship that due diligence checks have revealed Seaborne Freight is likely to be able to bring into service by March?
Chris Grayling
I am not sharing, nor is it my responsibility to share, the company’s commercial information. I simply remind the hon. Gentleman that no money will change hands unless the company is running this service. That seems to me to be the best possible protection for the taxpayer’s money.
Stephen Metcalfe (South Basildon and East Thurrock) (Con)
Will my right hon. Friend expand on the discussions he has had with the management team and what expertise and experience they are bringing to the table to operate this service?
Chris Grayling
My officials have had detailed discussions with the management team and have gone through their plans in detail. My hon. Friend might have seen the article in Lloyd’s List, which has also been shown the business plan and gave it a thumbs-up as being a viable option. This is a team of people who have experience in this industry and who we believe will deliver this service, but of course they will be paid only if they do so.
Stephen Morgan (Portsmouth South) (Lab)
Some 95% of fresh produce in the Channel Islands gets there via Portsmouth international port. Delays at our port would mean empty shelves in the Channel Islands in 48 hours. What guarantee can the Secretary of State give today to ensure uninterrupted delivery from all our ports of critical goods such as fresh food and medicine?
Chris Grayling
On incoming freight, we intend not to put in place complex checks at the border. We have been clear all along that the Government’s priority, apart from security, will be to ensure free movement of trade. Of course, goods arriving from the Channel Islands will not be subject to the kind of constraints we might see going in at Calais, and the issues around transport blockages really relate only to the short straits around Dover and the tunnel, not to other ports, where the movement of ships is not on a sufficient scale to cause significant blockages.
Matt Warman (Boston and Skegness) (Con)
It would be irresponsible not to prepare for no deal, of course, but would it not be even more irresponsible to be spending money where we did not need to?
Chris Grayling
That is why we are not going to spend the money until the ships are available and running. The reality is that we do need to spend money to prepare for a no-deal Brexit. I hope that money proves not to be needed—I want us to have a sensible partnership in the future—but believe me, if we were here now facing a no-deal Brexit and no preparation had been done, the shouting from the Labour party would be enormous.
Mr Paul Sweeney (Glasgow North East) (Lab/Co-op)
The Secretary of State talks about supporting entrepreneurialism. I am a big fan of “Dragons’ Den”, and I think this is one of those pitches that everybody would have been cringing at had they actually seen it, but it seems to be good enough for the Secretary of State. He talks about a no-deal Brexit. I think the Government should rule out a no-deal Brexit, but if he is insistent on planning ahead for it he needs sure delivery of freight capacity on shipping routes. The Ministry of Defence has immediate access to four roll-on roll-off ferries. Why on earth has he not committed to using those assets, which are immediately available to him, instead of insisting on a highly risky contractual arrangement with a dubious private contractor?
Chris Grayling
What I have done is insist on a highly substantial commercial arrangement with two very established cross-channel ferry operators and given a small amount of business to a new operator. If there is a no-deal Brexit, which I hope will not happen, we have several other measures that we can bring into place.
Rebecca Pow (Taunton Deane) (Con)
Will my right hon. Friend assure the House that he is in consultation with not only Dover and Calais but other ports about what would happen in the event of no deal, which I sincerely hope will not happen? The way to avoid no deal, of course, is to vote for the deal. In Taunton Deane, many businesses, lots of them small, rely on exporting and ferries. They must not be hampered and we must act responsibly to give them assurances.
Chris Grayling
The clearest assurance that I can give is that I have been to Calais and met my French counterpart to talk about this issue, I have met the president of the Nord-Pas-de-Calais, and officials have had discussions, and I have had no sense from any of those conversations that the French want anything other than to maintain the fluid movement of trade through the channel ports. That is something to which we should all aspire.
Jonathan Edwards (Carmarthen East and Dinefwr) (PC)
Does not this sorry episode clearly indicate that the absurd mantra of a managed no deal is a contradiction in terms?
Chris Grayling
As I say, the Government do not aspire to a managed or an unmanaged no deal—we want to secure a deal—but it is not responsible not to prepare for all eventualities.
Mr Philip Hollobone (Kettering) (Con)
I commend the Secretary of State for recognising that it is absolutely in the national interest to make preparations for a no-deal Brexit, not least because it strengthens our negotiating hand, even at this late stage. Will he tell the House what the common transit convention is, not only for the benefit of the House but in particular for the benefit of those on the Opposition Front Bench, and explain how it will mitigate the worst effects of impeded traffic flows in the event of no deal?
Chris Grayling
The common transit convention is the international agreement by which trade flows across multiple countries. It has already been announced that in leaving the European Union the United Kingdom will remain part of that convention, which will play a significant part in ensuring that trade flows freely in all situations. None the less, we need to make sure that we cannot get blockages at key ports, and that is what we are working to do.
Wayne David (Caerphilly) (Lab)
In the interests of transparency, will the Secretary of State indicate to the House which companies were considered for the contracts?
Chris Grayling
We received three compliant bids, all of which we judged acceptable and accepted. Two of them were from major operators that will provide around 90% of the capacity, plus there was this small additional contract. Should we choose to return to the market, there is also potential interest in the provision of extra capacity. I hope we will not need that, because I hope that we will have a proper deal come next week.
Douglas Chapman (Dunfermline and West Fife) (SNP)
It has certainly been an “I see no ships” sort of week, but what consideration has the Secretary of State given to utilising ports in other parts of the UK—namely, the high-exporting country of Scotland? I hear really good things about the potential for a Rosyth-Zeebrugge ferry link, for which potential ships have actually been identified. Is not Scotland losing out? How can we realise Scotland’s potential in this Brexit fiasco?
Chris Grayling
I appreciate that the Scottish National party does not support Brexit and, indeed, would like to do everything it can to stop Brexit, but we will work to make sure that every part of the United Kingdom, including Scotland, is able to continue to trade freely around the world and gain from the benefits that will be achieved in this country in a post-Brexit world.
Kevin Brennan (Cardiff West) (Lab)
I see no ships, but I do smell something fishy, and I think other colleagues do as well. Is the Secretary of State really saying to the House that the best choice for the contract was a company that cut and pasted its terms and conditions at the last minute from a fast-food company? Is his new Brexit mantra “A meal deal’s better than no deal”?
Chris Grayling
Of course, it is not a single contract. There are multiple contracts, of which 90% is going to two of the biggest cross-channel operators—something the Labour party appears to be completely ignoring. The fact is that we have chosen to give a small proportion of the business to a legitimate bid from a small start-up business, and I think that is something the Government should do more often, not less.
Chris Stephens (Glasgow South West) (SNP)
I think our plea to the contractors is that we want these ships, not excuses. Quite astonishingly, in answer to a question from the hon. Member for Easington (Grahame Morris), we heard from the Secretary of State that there will somehow be driverless ferries—that there will be no staff—so presumably there is no national minimum wage requirement in the contract. First, will the Secretary of State publish the legal advice that he says he was given? That seems sensible, given the House’s concerns. Secondly, will he tell us what were the procurement requirements in relation to equipment, such as ferries, or indeed in respect of the socioeconomic impact in relation to wages, for example?
Chris Grayling
In effect, what we are doing is buying tickets in advance on cross-channel ferries on a number of routes around the country. That is what we are doing. It is no more and no less than that.
Alex Sobel (Leeds North West) (Lab/Co-op)
It is quite incredible that the Secretary of State has awarded a contract to a company with no ships, no investors, no customers, no credible business plan, no employees and no premises. Is he aware that Seaborne Freight tried to get an option to purchase the following four ships: the Hartmut Puschmann, the Espresso Catania, the Espresso Ravenna and the Via Adriatico? They all operate in the southern Mediterranean and would need a complete refit to be able to operate in the channel. In addition, two of the ships failed EU safety inspections. On top of that, Tirrenia, which owns the ships, said that it would not sell them because it did not believe that Seaborne Freight had the money. I visited Tirrenia’s website and found that I could go on a Mediterranean cruise on the four vessels in April. Was the Secretary of State aware of that?
Chris Grayling
I am not going to comment on the commercial plans of Seaborne Freight. I am satisfied that it will have the ships necessary to operate the service, but if it is not able to deliver them, it will not be paid.
Luke Pollard (Plymouth, Sutton and Devonport) (Lab/Co-op)
Brittany Ferries has been awarded a no-deal ferry contract but, unlike Seaborne, it actually has ferries. No-deal sailings into Millbay port in Plymouth will increase traffic by 50%. Will the Secretary of State point to where on the 200 metres of tarmac between the ferry port and Plymouth city centre he expects facilities to be built for the lorry park, the customs checks, the veterinary checks and the environmental health checks?
Chris Grayling
Let me say two things. First, I thought it would be good for the port of Plymouth to have more traffic; I am sorry that the hon. Gentleman does not agree. Secondly, the reality is that, as I said earlier, we do not intend to impose a hard border for traffic coming into the United Kingdom. We intend to focus on the fluidity of trade as our priority. It will be security first and fluidity second, and other matters will come well afterwards. We are not imposing a hard border on this side of the channel.
Ferries
Lord Grayling Excerpts(5 years, 10 months ago)
Written StatementsRead Full debate Read Hansard Text Read Debate Ministerial Extracts
The Secretary of State for Transport (Chris Grayling)
The Government have entered into three contracts with ferry operators to provide additional ferry capacity and services into the UK as part of no-deal EU exit contingency planning.
While the ambition of Government is to ensure an orderly exit from the EU, the Department for Transport has been undertaking a wide range of work to mitigate the impact on the transport system of a no-deal EU exit.
Significant work has taken place to understand the effect that this would have on the UK border and the impact on flows of goods between the UK and EU. While the Government have made clear they are committed to ensuring frictionless movement across the UK border, the scale of the potential disruption to the Dover Straits, if additional customs checks were introduced in Calais, Coquelles and Dunkirk, where freight services disembark, could be very significant. Given the importance of these routes, contingency work is being undertaken to mitigate potential impacts and ensure that goods can continue to flow into and out of the UK as freely as possible.
A priority for Government is to ensure that the Port of Dover and the Eurotunnel can continue to operate at the maximum possible capacity. The Government are therefore working with both organisations and our French counterparts in Calais, Coquelles and Dunkirk so that any disruption or drop in throughput is managed effectively and mitigated.
There is a clear willingness to reach agreements which secure the continued operation of these vital trade routes in all scenarios and the Government remain confident that there will not be major disruption to the flow of goods across the border. Nevertheless, the potential for a decline in throughput remains possible in a worst-case scenario and the Government are therefore planning for all eventualities.
As one of several contingency measures being undertaken, the Department for Transport has completed a procurement process to secure additional ferry capacity between the UK and the EU which can be used for critical goods such as medical supplies in the event of disruption to cross-Channel crossings. A negotiated procurement procedure without prior publication was concluded as allowed for by regulation 32 of The Public Contracts Regulations 2015. An accelerated competitive process was carried out in order to ensure that capacity can be in place in time for a no-deal exit while at the same time securing value for money for the taxpayer. The Department approached a number of shipping providers capable of providing additional freight capacity in order to ensure fairness for the market and also engaged external expertise to ensure value for money for the taxpayer.
Bids were evaluated on the basis that they met our strategic aims of providing additional freight capacity for a no-deal Brexit scenario. Bids were reviewed against a number of criteria, including journey time, quality of delivery plans, and the pricing submitted by bidders.
The bids we received to provide capacity were subject to technical, financial and commercial assurance as part of standard due diligence procedures and consistent with that undertaken on all Government contracts. This included a price benchmarking exercise to ensure that the taxpayer was getting good value for money, and assurance on the delivery plans of our bidders.
The Department commissioned external advice from three respected professional advisers to support this work. Three contracts were agreed with operators totalling c.£103 million.
Two contracts went to established operators, Brittany Ferries (£46.6 million) and DFDS (c.£42.6 million). These contracts provide for additional capacity between the UK and EU on existing routes, via the provision of additional services and additional vessels. The contracts agreed with them include early termination provisions and other typical contractual provisions to ensure Government have the right protections in place, such as in the event of an operator becoming insolvent.
The routes agreed with Brittany and DFDS are away from the Dover Straits, and will run from the Ports of Immingham and Felixstowe (DFDS) and Poole, Plymouth and Portsmouth (Brittany) to destinations in Germany (Cuxhaven), the Netherlands (Vlaardingen) and France (Caen, Cherbourg, Le Havre, and Roscoff).
The third contract was awarded to Seaborne Freight (£13.8 million), a new operator to provide a new service between Ramsgate and Ostend. Seaborne Freight has been preparing for some time to operate services on this route. The management team of Seaborne has extensive experience in the shipping and maritime sector, including the operation of ferry services on cross-channel routes, freight brokerage, port management and vessel chartering.
While the broad contract structure is the same for all three contracts, including the provision that payment will only be made in arrears and on the successful provision of services, the Seaborne contract is also subject to the achievement of a range of key milestones including in relation to finalising funding and vessel chartering agreements.
As with many operators in the sector, it is not uncommon that they do not own their own vessels and will be chartering them through third parties. The Department has reviewed their plans for sourcing vessels with the support of external advisers. A number of large institutional investors are backing this service and the Government’s contract represents a small part of the overall investment required by Seaborne to open this route. These lenders undertake their own rigorous due diligence before making financial commitments, providing a further level of assurance to Government. Seaborne and my Department are also working closely with Thanet Council to ensure that Ramsgate Port is ready to take new services. A programme of work to prepare the infrastructure is under way.
In total the additional freight capacity delivered by these three contracts will be equivalent to around 8% of normal flows across the Dover Straits. While this will not be sufficient to mitigate the full level of disruption possible in a worst-case scenario, it will enable the Government to provide essential capacity for the highest priority goods including medical supplies.
In terms of next steps, the Department for Transport will provide support to and oversight of all operators to ensure that these services are delivered to meet the terms of the contracts agreed.
I will provide further updates to Parliament at the appropriate points.
[HCWS1233]
Drones: Consultation Response
Lord Grayling Excerpts(5 years, 10 months ago)
Commons ChamberRead Full debate Read Hansard Text Read Debate Ministerial Extracts
The Secretary of State for Transport (Chris Grayling)
I should like to make a statement about the action the Government are taking on our future policy on drones.
The disruption caused by drones to flights at Gatwick airport last month was deliberate, irresponsible and calculated, as well as illegal. It meant days of chaos and uncertainty for over 100,000 passengers at Christmas, one of the busiest times of the year. Carefully planned holidays were disrupted, long-expected reunions between friends and relatives missed. Families were forced to spend hours at an airport, not knowing if or when they would reach their destinations—completely unacceptable and utterly illegal. I pay tribute to all at Gatwick and other airports who worked very hard to make sure people did get away, albeit belatedly, for their Christmas breaks, and I thank all those in the defence world and the police who worked hard to get the airport back together again, and of course Sussex police are now leading the investigation into this criminal activity.
I am clear that, when caught, those responsible should face the maximum possible custodial sentence for this hugely irresponsible criminal act, and I want to assure the House that my Department is working extremely closely with airports, the Home Office, the Ministry of Defence, the Civil Aviation Authority and the police to make sure our national airports are fully prepared to manage any repeat of what was an unprecedented incident. I spoke personally to the heads of the major UK airports before Christmas, and later this week the aviation Minister, Baroness Sugg, will meet them again for an update on progress. In the meantime the Ministry of Defence remains on standby to deal with any further problems at Gatwick or any other airport if required.
This incident was a stark example of why we must continue to ensure drones are used safely and securely in the UK. Today I am publishing the outcome of our recent consultation, “Taking flight: the future of drones in the UK.” We received over 5,000 responses to that consultation reflecting a broad range of views. Those responses underlined the importance of balancing the UK’s world-leading position in aviation safety and security with supporting the development of this emerging industry. The Government are taking action to ensure that passengers can have confidence that their journeys will not be disrupted in future, aircraft can safely use our key transport hubs, and criminals misusing drones can be brought to justice.
The UK is where technology companies want to build their businesses, invest in innovation and use science and engineering to bring immense benefits to this country. Drones are at the forefront of these technological advances and are already being used in the UK to great effect. Our emergency search and rescue services use drones on a regular basis. Drones can also reduce risks for workers in hazardous sectors such as the oil and gas industries, and this technology is also driving more efficient ways of working in many other sectors, from delivering medicines to assisting with building work.
However, the Gatwick incident has reinforced the fact that it is crucial that our regulatory and enforcement regime keeps pace with rapid technological change. We have already taken some big steps towards building a regulatory system for this new sector. It is already an offence to endanger aircraft. Drones must not be flown near people or property and have to be kept within visual line of sight. Commercial users are able to operate drones outside of these rules, but only when granted CAA permission after meeting strict safety conditions.
Education is also vital to ensure everyone understands the rules about drone use. That is why the CAA has been running its long-standing Dronesafe campaign and Dronecode guide—work that is helping to highlight these rules to the public. And on 30 July last year we introduced new measures that barred drones from flying above 400 feet and within 1 km of protected airport boundaries. In addition, we have introduced and passed legislation that will mean that from November all drone operators must register and all drone pilots complete a competency test.
However, we now intend to go further. Today’s measures set out the next steps needed to ensure that drones are used in a safe and secure way and that the industry is accountable. At the same time these steps will ensure that we harness the benefits that drones can bring to the UK economy.
A common theme in those 5,000 consultation responses was the importance of the enforcement of safety regulations. The Government share that view. The majority of drone users fly safely and responsibly, but we must ensure that the police have the right powers to deal with illegal use. We will therefore shortly be introducing new police powers. These include allowing the police to request evidence from drone users where there is reasonable suspicion of an offence being committed, as well as enabling the police to issue fixed penalty notices for minor drone offences. Those new powers will help to ensure effective enforcement of the rules. They will provide an immediate deterrent to those who might misuse drones or attempt to break the law.
My Department has been working closely with the Home Office on the legislative clauses that will deliver these changes. It is of course crucial that our national infrastructure, including airports and other sites such as prisons and energy plants, are also adequately protected to prevent incidents such as that at Gatwick. We must also ensure that the most up-to-date technology is available to detect, track and potentially disrupt drones that are being used illegally, so we have also consulted on the further use of counter-drone technology. Those consultation responses will now be used by the Home Office to develop an appropriate means of using that technology in the UK.
Of course, aviation and passenger safety is at the heart of everything we do. While airlines and airports welcomed our recent airport drone restriction measures, they also asked for the current airport rules to be amended in order to better protect the landing and take-off paths of aircraft. We have listened to those concerns, and we have been working with the CAA and NATS to develop the optimum exclusion zone that will help to meet those requirements. It is important to stress that any restriction zone would not have prevented a deliberate incident such as that at Gatwick. However, it is right that proportionate measures should be in place at airports to protect aircraft and to avoid potential conflict with legitimate drone activity. We will therefore introduce additional protections around airports, with a particular focus on protected exclusion zones from runway ends, alongside increasing the current aerodrome traffic zone restrictions around airports. Drone pilots wishing to fly within these zones must do so only with permission from the aerodrome air traffic control. We will amend the Air Navigation Order 2016 to implement these changes.
I want to address some of the rather ill-judged comments that have been made by Labour Members. Let me remind them of three things. First, the event at Gatwick airport was a deliberate criminal act that can carry a sentence of life imprisonment. We can pass new laws until the cows come home, but that does not stop people breaking them, and the law is as tough as is necessary to punish the perpetrators of an attack such as this. Secondly, this was an entirely new type of challenge. It is noteworthy that, since the events at Gatwick, we have been approached by airports around the world for our advice on how to handle something similar. Thirdly, the issue was solved only by the smart and innovative use of new technology. For security reasons, I am not going to give the House details of how this was achieved, but I want to extend my thanks to the Ministry of Defence for moving rapidly to put a new kind of response into the field.
There is no question but that lessons have to be learned from what happened at Gatwick. Passengers have to be able to travel without fear of their trips being disrupted by malicious drone use. Airports must be prepared to deal with incidents of this type, and the police need the proper powers to deal with drone offences. We must also be ready to harness the opportunities and benefits that the safe use of drones can bring. The measures I have announced today in response to the consultation will take us forward on that front, and I commend this statement to the House.
Chris Grayling
The hon. Gentleman is right to say that the rhetoric we have heard today is many miles away from reality: his rhetoric! Let me restate the point that this was a crime. It was an illegal act, and it had nothing to do with the laws that are in place. Somebody deliberately decided to disrupt Gatwick airport. It was a crime that will carry a sentence of up to life imprisonment when that person is caught, and I put it to the House that that maximum penalty is, in my view, appropriate to the crime. This is not a question of the laws not being in place; it is a question of catching the person who did this, and Sussex police, amply supported by the Met and our security agencies, are working very hard to achieve that.
The hon. Gentleman’s second point was about technology. Let me gently explain that the technology that was deployed with the help of the Ministry of Defence, for which we are grateful, to tackle the problem is new and unavailable elsewhere in the world. This country is at the forefront of developing systems that can combat this kind of issue, and a huge amount of work is ongoing to find out what is on the market and to assemble new kinds of systems, but there simply is not an off-the-shelf solution available to airports that they could buy tomorrow to provide protection against such attacks. A huge amount of work will now take place to ensure that that can happen, but he is simply ill-informed if he believes that there is some magic solution that was not put in place.
The third point is that other airports are now placing a huge amount of focus on ensuring that such things cannot happen again. Above all, however, we have put in place a mechanism to redeploy the MOD capability should such an event occur again. I hope that it does not, but we know how to deal with it if it happens again, and other airports around the world are coming to us asking, “What do we need to do?” That is the reality of what is happening, not the nonsense we have just heard from the Opposition spokesman.
Henry Smith (Crawley) (Con)
As the Member of Parliament for Gatwick airport, I extend my thanks to everybody who worked so hard on 19 and 20 December to mitigate the deliberate criminal act that the Secretary of State correctly identified. One of my concerns is that the Ministry of Defence was not brought in until some 18 hours after the incident started on the Wednesday evening, so will the Secretary of State assure me that the deployment of the military technology will be more rapid if further such attacks are forthcoming?
Chris Grayling
I am grateful for the opportunity to reiterate my thanks to all those in and around Gatwick who worked so hard at an extremely difficult time for the airport. As for the deployment of the technology, the first thing to say is that it was not immediately apparent that we were dealing with anything more than irresponsible drone usage close to an airport, which has happened many times over the past few years. By the time it became clear that this was a malicious attack, the Government machine and the Ministry of Defence moved as quickly as possible to deploy a new kind of response to deal with the issue. Clear protocols are now in place that would enable the system to be deployed quickly, but I hope that that will not have to happen again.
Alan Brown (Kilmarnock and Loudoun) (SNP)
I thank the Secretary of State for sharing the parts of the statement he felt like sharing in advance. He was previously warned about the need for tougher legislation by my predecessor as Scottish National party spokesman, my hon. Friend the Member for Inverness, Nairn, Badenoch and Strathspey (Drew Hendry), the shadow Minister, by myself and by the British Airline Pilots’ Association, so why did he ignore those warnings and delay legislating in this area? What new evidence has actually emerged from the consultation confirming the need for additional enforcement powers, other than the blatant reaction to the Gatwick incident? How many of the 5,000 responses to the consultation related to enforcement?
How much was spent on overtime over the holiday period to get the consultation response document ready for the first day back so that the Secretary of State could pretend that he is suddenly in charge? How did the Government come up with a 400 feet-high and 1 km-wide exclusion zone? Using two different methods of measurement is a complete recipe for confusion. What consultation was undertaken at that time? What was BALPA’s view? What was the view of the Civil Aviation Authority and NATS when the previous exclusion zone was proposed? How has the Secretary of State now suddenly arrived at a 5 km exclusion zone? Why did the Government not meet the stated target of a draft Bill by summer 2018? What updates on that lack of progress did they ever give to Parliament?
Given that legislation regarding the use and deployment of drones is reserved to Westminster, what support will the UK Government offer to Scottish airports to allow them to comply with any changes? Will that include financial support? The Secretary of State mentioned that the Home Office is legislating for and developing the appropriate means of using the new technology, so which is the lead Department? Will all the legislation come in one new Bill? How do we know that the planned timetable will be met?
Under this Secretary of State’s watch, we have had the east coast mainline bail-out, the Northern rail fiasco, the Thameslink rail fiasco, delays to High Speed 2, contracts awarded to Carillion, and a ferry contract awarded to a company with no ferries. Today, his Department could only muster 89 lorries out of a planned 150 for a pretend no-deal scenario planning exercise. When we factor in the drone legislation fiasco, when is he going to move aside?
Chris Grayling
Well, it is difficult to tell whether we got more nonsense today from the SNP or from Labour. The hon. Gentleman appears not to have noticed that we legislated last summer to tighten up the rules around drones. He asked whether we had been working overtime over the Christmas period. I have to say that the consultation response was finished before Christmas, work on draft clauses for the drones Bill is substantially completed, and we have now brought forward this, which was well prepared over many months, so that question was nonsense as well.
The hon. Gentleman talked about the approach to the exclusion zone around airports. We judge that it is necessary to provide as much protection as possible to the flight path into and out of an airport, which is why we end up with something that looks more like the Transport for London sign, with bits sticking out either side to provide extra protection for the approach and landing areas, than a pure circle around the airport. As for Scottish airports, they have been a part of the discussions that I had over the Christmas period and will be a part of the discussions that Baroness Sugg will be having later this week.
Dr Julian Lewis (New Forest East) (Con)
I fully accept what the Secretary of State says about the adequacy of the laws and the deterrent effect of potential sentences. However, it is possible for anybody to go on the internet and buy a simple but substantial device that they could use not to try and close an airport, as in this case, but to fly into the engine intakes of a plane that was landing or taking off. What can he tell us about not only registration but, more importantly, the capability to prevent such an attack maliciously being mounted by someone who might well belong to a jihadist organisation and who will not be deterred by death, let alone by long prison sentences?
Chris Grayling
That is a serious point that we and the security services have been working on. We have been in conversation with airports about it for some considerable time, and two things are happening on that front. First, this country has moved to introduce a drone registration scheme, which will start later this year. Secondly, and more significantly, the European Aviation Safety Agency is moving towards a requirement, which I expect to be introduced within two to three years, for all drones to contain technology that allows them to be tracked and potentially to be stopped in critical areas.
Lilian Greenwood (Nottingham South) (Lab)
I welcome the Secretary of State’s statement, but I wonder whether it closes the gate after the horse has bolted. BALPA has been warning about the rise in irresponsible use of drones close to aircraft and airports for years. An incident of this sort was surely foreseeable, and I am unsure whether the Secretary of State was saying that he was satisfied that the airport had proper and adequate plans to respond to such a risk. However, changes to regulations will mean nothing if we are unable to stop, catch and prosecute offenders. If such a crime is perpetrated in the future, what assurances can he give the House that it could not lead to further such disruption to services?
Chris Grayling
On the hon. Lady’s point about BALPA, we legislated last summer to make certain activities around airports illegal. That included the height at which a drone can be flown and the restricted area around an airport within which a drone could not be flown. She asked what would happen in a future incident. Right now, we have protocols in place to allow us to deploy the same equipment as was used at Gatwick if there were to be a repeat attack. The airline industry and the airport industry are working intensively to try to assemble mechanisms that could prevent such an attack from happening again. The reality is that there is not, and has not been, an off-the-shelf solution. That is now being worked on—the technology is being assembled and systems are being integrated—but there is no simple, off-the-peg solution available right now, beyond the capability that we have in place to protect UK airports.
Justine Greening (Putney) (Con)
In my constituency, which is under the Heathrow flight path, there are significant concerns about aircraft safety. I have written to the Secretary of State in the past, prior to the incident, about my concerns over drones. Does he recognise that far less attention is paid to mitigating risk outside airports than inside them? Does he agree that it is sheer folly to get on with expanding Heathrow and increasing the threat to communities such as mine, which will have more flights going over them, while this clear risk continues? Should we not seriously consider whether that is a sensible approach to take over such a densely populated area, when, as he says, the technology to provide greater safety simply does not exist at scale?
Chris Grayling
I know how strongly my right hon. Friend feels about the matter. Of course, the same issue would arise whether expansion took place at Gatwick, Stansted or Heathrow. The reality is that Heathrow has been ahead of most other airports in providing protection against drones, but even Heathrow has not had the perfect solution. That is why the systems that we now have in place could be deployed at Heathrow at short notice to provide protection for the airport.
John Spellar (Warley) (Lab)
I think it was Peel who said that the absence of crime, not the apprehension of criminals, was the test of a good force. What the hundreds of thousands of travellers wanted was for the disruption to be stopped. May I ask some very specific questions? Were there contingency plans already agreed with the MOD and the Home Office to protect our airports from drone incidents and others? If not, why not? If there were such plans, why did they not work? Were they not activated in time because of dithering, and was that the fault of the Secretary of State’s Department, the Ministry of Defence or the Home Office—or, indeed, the Cabinet Office and the Cabinet Secretary in No. 10? Which is it?
Chris Grayling
As we are hearing from around the world, protections against such a deliberate and disruptive attack are few and far between. The reality is that the Government and different Departments, including the MOD, moved very quickly to assemble a response of a different kind from any previous one, and they did so in a way that is now being looked at very carefully around the world.
Mrs Maria Miller (Basingstoke) (Con)
My right hon. Friend is absolutely right that what we saw at Gatwick was criminal activity, and I welcome the actions that he has taken. My constituents are surrounded by airports at Southampton, Farnborough, Lasham and the Odiham RAF base. What discussions has my right hon. Friend had with these smaller airports, which have real challenges when it comes to taking measures to protect themselves from such malicious attacks? As my right hon. Friend the Member for Putney (Justine Greening) has said, such attacks threaten not only safety in the air, but residents on the ground.
Chris Grayling
That is why the measures we introduced last summer—to make it illegal to fly a drone close to an airport and to put restrictions on the height above which one can fly a drone—were applicable to the situation in most of the drone incidents that have occurred, namely irresponsible usage close to an airport. There were 97 such incidents last year. We will be sharing the experience of Gatwick, and indeed the technological developments, with airports such as Southampton. Such airports may want to take steps similar to those taken by bigger airports to protect themselves. As I say, this is an emerging technology.
Jamie Stone (Caithness, Sutherland and Easter Ross) (LD)
What happened at Gatwick was, as the House knows, pretty damned scary. Wherever we travel in the world, passengers have an equal right to confidence and safe travel. Let us hope that we in the UK get the legislative framework right and work out how to take down such drones if they are hostile. I suggest that it would be in the best interests of travellers all over the world for us to share our knowledge, and perhaps to work towards some sort of international treaty governing the use, administration and stamping out of drones when they are in bad use.
Chris Grayling
I absolutely agree with that. We are already seeking to share our knowledge and experience, and I expect it is something that the International Civil Aviation Organisation will also want to pick up on. [Interruption.] Once again, the shadow Minister is rabbiting on from a sedentary position about EASA. It is Government policy to remain part of EASA, if we can, because in areas such as international aviation safety, we believe it is sensible to work internationally across borders.
Tim Loughton (East Worthing and Shoreham) (Con)
The oldest commercial airport in the country is in Shoreham, in my constituency. This problem affects not just the large commercial airports, but the smaller ones too. Sussex police were greatly stretched when the incident happened, and I know that they greatly welcomed the offers of help from around the country, but there was concern about confusion over the lead Department. Was it Transport or the Home Office? Of course, later the Ministry of Defence was brought in as well. What assurances can the Secretary of State give that in future there will be a much better immediate, co-ordinated response?
The Secretary of State has spoken about the need to legislate, and about registering drones. The trouble is that most of them come in from China and, increasingly, a lot of them can be DIY built. The people who do that do not register, and they have no regard for regulations. Those drones will certainly not carry devices that make it possible to disable them, to ensure that they are not harmful near airports. What is he doing about that?
Chris Grayling
That is precisely why the technology becomes so important: for all the requirements that one puts into law, including around the technology that goes into drones, ultimately if people choose to act in a deliberate, disruptive and illegal way, the technology needs to be there to stop them. In respect of responsibility, the gold command was Sussex police, supported by the Metropolitan police and the security services. In Government, my Department took the lead.
Drew Hendry (Inverness, Nairn, Badenoch and Strathspey) (SNP)
The document to which the Secretary of State referred is called “Taking Flight”, but is it not true that his Government have taken flight over this issue? This is not a new issue that has suddenly arrived: BALPA has been arguing for greater protection for years. Indeed, almost three years ago I raised this issue with the then Minister of State, the right hon. Member for Scarborough and Whitby (Mr Goodwill), when I said,
“we have the current issue of drones near aircraft, which needs to be addressed in an air strategy. I hope that the Minister will do something about that before there is a critical problem.”—[Official Report, 20 April 2016; Vol. 608, c. 357WH.]
The Minister of State said in that debate that he was
“wise enough not to stray into”—[Official Report, 20 April 2016; Vol. 608, c. 361WH.]
those issues. Is it still wise not to have not done anything for more than three years?
James Cartlidge (South Suffolk) (Con)
Just prior to Christmas, I held a rural crime summit in Lavenham in my constituency. A key issue raised was hare coursing. I was pleased to learn that Suffolk constabulary had purchased a drone, which will be used to gather intelligence and will greatly enable us to fight back against this real menace in rural areas. Does the Secretary of State agree that although the incident with drones that we are discussing was criminal, the technology offers great potential for fighting back against criminality, and in particular those crimes with which we have historically struggled to deal?
Chris Grayling
I quite agree, which is why the strategy is about not only meeting the challenge of the careless, illegal or inappropriate use of drones but setting a direction to ensure that we allow the kind of usage that my hon. Friend talks about. As well as the inspection of infrastructure and policing, there are a whole variety of other ways in which drones can be a positive for our society.
Kevin Brennan (Cardiff West) (Lab)
The Secretary of State is right that what we are discussing was a crime, but it was an entirely foreseeable crime. I, too, asked the previous aviation Minister about this issue two and a half years ago. Is the truth not that these matters really should be the responsibility of the Ministry of Defence, because the consequences of bringing down a civil airliner of this kind are so huge? It may or may not have been the Secretary of State’s fault, but it was beyond the competence of his Department. It is far too serious to be dealt with by the Department for Transport.
Chris Grayling
I do not think it is a question of one Department or another: we have to work as a team. The truth is that the Ministry of Defence has and did have a really important role. The Home Office has a really important role in enforcement and licensing. The Department for Transport manages the use of airspace. It is a policy area in which the Government need to work as a team. My view is that the response, which brought three Departments together, was the right approach.
Bill Grant (Ayr, Carrick and Cumnock) (Con)
In my 30 years in the fire service, I attended two major aircraft incidents, one of which resulted in multiple fatalities. The whole House and the nation can be grateful for the actions taken at Gatwick airport, where there was no loss of life and no loss of aircraft. Despite the chaos for the travelling public, in the circumstances it has to be measured as good that there was no loss of aircraft and no loss of life. In the light of the events at Gatwick, what discussions has my right hon. Friend had with airport operators throughout the United Kingdom about mitigating or preventing the malicious incursion of drones into operational airspace? We must bear in mind that those intent on bringing chaos and death to the air-travelling public will not respect exclusion zones, so on their own exclusion zones will not stop the drones.
Chris Grayling
That is the central point: we could have done everything imaginable in legal terms, but if somebody is determined to cause an attack of this kind, they will do so. It is now very much about understanding what technology can make a difference. In technological terms, this was very much a learning exercise, because there simply was not an off-the-shelf system available to deal with it. It took a lot of effort to work out what competencies were there and to assemble them in a way that could work. It was the first time that had been done anywhere in the world. We now understand more clearly how to deal with an attack such as this one, and others will have learned from it so that the kind of terrible events that my hon. Friend mentioned can never happen in such a situation.
Luke Pollard (Plymouth, Sutton and Devonport) (Lab/Co-op)
I declare an interest: my boyfriend was one of those people who were supposed to land at Gatwick. Although he landed a few days later, he did so safely, and that was appreciated.
It is right that technological solutions must keep pace with the threats that we face. What consideration has the Secretary of State given to live-update geofencing to make sure that if people are accidentally flying a drone near a restricted airspace—around not only airports but defence installations—that drone will not be able to access that airspace and that it can be live-updated by the authorities to make sure that drones do not enter any restricted airspace?
Chris Grayling
This is one of the areas that is currently being worked on at a European level. We are working with EASA on this and we expect regulations to come forward during the implementation period that we would want to be part of in any case, because these technologies are made not just in one country. The point about geofencing is an important one, as is the ability to include technology that enables us to track a drone and to know which drone it is. My hon. Friend the Member for East Worthing and Shoreham (Tim Loughton) made the very real point that a number of these machines are assembled by amateurs on a fair scale, which is why we need the technology to take them down as well.
Jeremy Lefroy (Stafford) (Con)
Who is responsible for inspecting airfields and airports for their security in matters such as this? Can we have a report in a few weeks’ time—I appreciate that not everything can be disclosed—that says that all major airports in the country have been inspected and have put in place the right measures to prevent or deter an incident such as that at Gatwick?
Chris Grayling
Most immediately, the security at the airport is the responsibility of the owners themselves, supported by my Department and by the national security agencies. Those discussions are already happening—they were happening within a matter of hours of the incident at Gatwick. I can assure the House that every airport is now taking active steps to look at what measures it can put in place, but the reality is that these are experimental systems and are not universally available yet. It will take a bit of time for other airports to get them in place. In the meantime, the Ministry of Defence capability is there if necessary.
Mrs Madeleine Moon (Bridgend) (Lab)
I urge the Secretary of State to look at the reports by the BBC’s Quentin Somerville who shows how drone attacks, using commercially available drones, have been using chemicals and explosive devices on the battlefields of Mosul. In many respects, we were fortunate—darn lucky—in that we had a wake-up call at Gatwick. May I suggest that the Secretary of State talks not only to the MOD but to NATO, where there is huge expertise about the use on the battlefield of drones, which can be bought commercially and used here by terrorists who want to attack us?
Chris Grayling
I can assure the hon. Lady that we are very well aware of that and, indeed, the security services have been providing advice to airports about this for some considerable time. They have provided advice specifically based on some of those experiences in the middle east, and this is something on which we work with them continuously.
Nic Dakin (Scunthorpe) (Lab)
There was some speculation in the press at the time that there may not have been any drones involved in this incident. Will the Secretary of State confirm how many malicious drones brought all this destruction to Gatwick, and can he tell us, in the light of this experience, what he is doing to make sure that his Department supports airports around the country in getting their contingency plans updated?
Chris Grayling
The report of there being no drone was a misspeak by a police officer. I have spoken to the chief constable since and to the airport chief executive—we talk regularly—and there is no question but that there was a drone or a small number of drones. Nobody is quite sure whether it was one, two or three, but it certainly was not a large number—probably only one. It made a return on a regular basis on many occasions just as the airport was about to reopen. On contingency work, I spoke to the operators of all the major airports on the day after this happened. Within a short period of time, after we understood what the issue was, police around the country were carrying out additional patrols around those airports. We have had regular discussions since. Baroness Sugg is holding a further meeting with them in a few days’ time to get an update on their plans. All of them have been briefed that we can provide the kind of support that the MOD provided at Gatwick if something happens there.
Christine Jardine (Edinburgh West) (LD)
I was one of those tens of thousands of people whose journey was disrupted that day. After the initial relief that it had been rearranged in such an orderly way for me to get home to Edinburgh, which also had to cope with the knock-on effect, I was aghast that one of our major airports could be so vulnerable and that it took so long to get it back in play. That is an issue which, with respect, the Secretary of State will have to pay attention to and address. He said a few minutes ago that these incidents are few and far between, but, with respect, it would take only one to create a catastrophe and there has been an undermining of public confidence in the safety at our airports. Will he bring forward some report, some work to reassure the public, and, without in any way undermining security, detail how our passengers will be protected in our airports?
Chris Grayling
I am happy to do that to some degree, but the reality is that the response by the Ministry of Defence included some highly sensitive, confidential, secure equipment. That equipment is there to be deployed at other airports at short notice, should the need arise. I give the hon. Lady an undertaking that we are talking to all those airports about what additional measures they can put in place and are already putting in place to ensure that this cannot happen again. Until now, all the experience of drone incidents around the world has been of irresponsible drone usage. This is the first time that a drone has been deliberately used in a very clever way over a sustained period of time to disrupt an airport. Airports now need to ensure that they are ready to make sure that that cannot happen again.
Martin Docherty-Hughes (West Dunbartonshire) (SNP)
I hope that it comes as no surprise to the Secretary of State that I am now the fourth member of the Defence Committee to rise. It comes as no surprise to the four members of that Select Committee present in this Chamber that this situation has arisen and that nothing was planned to deal with the consequences other than calling the Ministry of Defence, whose Ministers, I am disappointed to say, are not also on the Front Bench.
As a constituency MP, like many others here with airports within distance of their constituencies, I wonder whether the Secretary of State can give some assurances to my constituents, specifically in Whitecrook in the burgh of Clydebank. Does the Secretary of State recognise that disruptive technology is not new?
With all due respect to my hon. Friends and colleagues who were disrupted during the travel episode, this is also not just about the traveller. It is about the person living on the ground, if a tragic event should bring down a liner on top of a community represented by any of us. Fundamentally, this is not just about airports or aeroplanes. What should happen, as the Chair of the Select Committee himself asked, if someone should use a drone to attack a piece of infrastructure, whether it be an oil refinery or rig, or a large drone hits the front of a high-speed intercity train? The Secretary of State must recognise the consequences of this situation and the impact on people’s lives if nothing is done about it.
Chris Grayling
Of course. Many people around the world are trying to find the perfect anti-drone solutions but, as Gatwick airport discovered, the reality is that those technologies are still embryonic. We now have in place an assembly of systems that will enable us to deal with an incident such as this again, but there is a lot of work to be done and a lot of work is being done.
EU Transport Council
Lord Grayling Excerpts(5 years, 11 months ago)
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The Secretary of State for Transport (Chris Grayling)
I attended the only formal Transport Council under the Austrian presidency (the presidency) in Brussels on Monday 3 December.
The Council reached general approaches on the social and market pillars of the first tranche of the ‘Mobility Package’. The ‘social pillar’ is intended to establish a specific regulatory regime for the posting of workers in the road transport sector, and the ‘market pillar’ is intended to introduce new regulatory requirements for the operation of light commercial vehicles (vans); and to modify the ‘cabotage’ rules for vehicles operating in countries other than their country of establishment.
I welcomed the work that the presidency had done to achieve compromises on these challenging proposals, give the range of view from member states. During the discussion, I pressed for a further reduction in the proposed cabotage ‘cooling-off period’ (a period of time between cabotage operations) and for extending the period after which a vehicle should return to base to 10 weeks. After a lengthy debate a compromise was reached which included the reduction of the ‘cabotage’ cooling-off period to five days; clarifying when the posting of workers rules would apply to different haulage operations; removing altogether the requirement for the return of the vehicle; and retaining the original proposal to ban drivers from taking weekly rest in the cabin of their vehicles.
Following this, the Council reached a general approach on a proposal from the second tranche of the ‘Mobility package’, to amend the current directive on combined transport. The existing directive liberalises cabotage operations when part of a freight journey that comprises a rail or sea leg. The general approach included an amendment to these cabotage provisions in line with the earlier compromise on cabotage rules.
The Council reached a general approach on the proposed directive on road infrastructure safety management (RISM), from the third tranche of the ‘Mobility Package’.
The lunchtime debate consisted of Ministers discussing how to address airspace capacity constraints and was followed by presentations from Eurocontrol Director General, Eamonn Brennan and Transport Commissioner, Violeta Bulc.
Later, the Council reached two general approaches on the proposed directive on minimum level of training for seafarers and the proposed regulation establishing a European maritime single window. In addition, the Council adopted conclusions on inland waterway transport.
The Council reached a partial general approach on the Connecting Europe Facility (CEF), endorsing the text presented by the presidency. The outstanding elements are those subject to horizontal negotiations on the multi-annual financial framework beyond 2020.
The Council noted the presidency’s progress reports on discontinuing seasonal changes of time, rail passenger rights, streamlining the trans-European transport network, clean and energy efficient vehicles and electronic freight transport information.
Finally, there were several information points from member states, the presidency and Commissioner Bulc under any other business. The presidency updated Council on the provisional agreements reached with the European Parliament on electronic road tolling and exchange of information, safeguarding competition in air transport and aviation wet-leasing. Commissioner Bulc noted good progress in on-going EU-ASEAN aviation negotiations that she hoped would conclude this year. In reply to a joint declaration from Luxembourg, Belgium, Denmark, France, Germany and the Netherlands on the social agenda in aviation, Commissioner Bulc noted that she would present a progress report on the social agenda identifying actions for potential completion. Ireland intervened to defend the value of new business models in aviation. Commissioner Bulc also drew attention to the 17 December conference on sustainable transport infrastructure charging and internalisation of transport externalities to be held in Brussels. The presidency provided an update on the EU’s space programme and the outcome of the informal meeting of Transport and Environment Ministers held in Graz on the 29-30 October 2018. Finally, Romania presented transport plans for its incoming presidency of the Council of the European Union.
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GTR: May Timetable Disruption
Lord Grayling Excerpts(5 years, 11 months ago)
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The Secretary of State for Transport (Chris Grayling)
I wish to inform the House that the Department for Transport has completed its analysis of the events surrounding this year’s May timetable introduction on the GTR network. In line with Professor Stephen Glaister’s interim report, it has concluded that the disruption on this network was caused by a series of mistakes and complex issues across the rail industry.
I can announce today that the Government are holding GTR to account for its role in the unacceptable performance following the introduction of the May timetable. GTR will make no profit from its franchise in this financial year and looking ahead, we have also capped the amount of profit that the operator is able to make for the remainder of its franchise, which is due to expire in September 2021.
Furthermore, GTR will be contributing £15 million towards tangible improvements for passengers. This is in addition to the £15 million the operator has already contributed towards compensation for passengers since the May timetable disruption. GTR has agreed to work with the rail user groups representing passengers of Thameslink, Southern and Great Northern, who will determine what improvements this package will fund.
The Department has concluded that a termination of the franchise would cause further and undue disruption for passengers and is not an appropriate course of action.
Performance after the May timetable change was unacceptable. This action announced today holds GTR to account appropriately and will benefit passengers. The Department will continue to monitor closely the performance of GTR, particularly during the upcoming December timetable change. These measures do not make GTR immune from further sanctions in the event of any subsequent failure to perform.
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