Chris Grayling faced calls to quit today after agreeing to pay up to £33 million to Eurotunnel in a legal bust-up over extra ferry services if Britain crashes out of the EU.
The Transport Secretary, recently dubbed Failing Grayling over a string of controversies, announced the settlement, which sparked immediate accusations of serial government bungling over Brexit preparations.
Downing Street was forced to say the Prime Minister still had confidence in the leading Brexiteer.
Recent controversies include a Brexit contract with a ferry company that had no ships, a railway timetable shambles and a bill of nearly £500 million after problems with partial privatisation of the probation system, dating from when Mr Grayling was justice secretary.
In an unusual move, which appeared to be an attempt to protect him from criticism, Mr Grayling made the Eurotunnel announcement this morning in a joint statement with two other Cabinet ministers, Brexit Secretary Steve Barclay and Health Secretary Matt Hancock.
The Department for Transport contracted three suppliers, including Brittany Ferries and DFDS, in December to provide additional freight capacity for lorries.
However, Eurotunnel claimed the contracts were handed out in a “secretive” way, through a six-week process to speed up no-deal plans, and that it was not given the chance to compete.
Just hours before a court case on the row was due to start today, the ministers announced that tens of millions of pounds of public cash would be used to settle it.
The move prompted immediate calls for Mr Grayling to stand down. Shadow transport secretary Andy McDonald said: “His conduct as a minister is one of serial failure and routine incompetence. It’s time for Chris Grayling to go.”
Liberal Democrat Brexit spokesman Tom Brake said: “Either he should resign or Theresa May must sack him.”
Labour MP Meg Hillier, chairwoman of the public accounts committee, said Mr Grayling’s permanent secretary would be facing questions on the scandal at a grilling next week.
She told Evening Standard: “We have already seen the fiasco over Seaborne Freight, and now we are seeing that this rushed and ill-thought-out approach is not helping with Brexit and it is costing the taxpayer dearly.”
Mr Grayling was embarrassed when he had to axe a contract with a third ferry company that turned out to have no ships. He struck a £13.8 million deal with Seaborne Freight to run services from Ramsgate — but an Irish company expected to provide vessels pulled out.
Mr Grayling defended the settlement, saying: “The agreement with Eurotunnel secures the Government’s additional freight capacity, helping ensure that the NHS has essential medicines in the event of a no-deal Brexit.
“While it is disappointing that Eurotunnel chose to take legal action on contracts in place to ensure the smooth supply of vital medicines, I am pleased that this agreement will ensure the Channel Tunnel is ready for a post-Brexit world.”
Batting off the calls for Mr Grayling to resign, a DfT source stressed: “This was a collective decision.”
The DfT emphasised that under the agreement, Eurotunnel had committed to implement measures which will improve security and traffic flow at the border, including better access to the UK terminal.
Meanwhile, Mrs May faced another backlash today as her former Brexit secretary Dominic Raab joined calls to crash out of the EU if her deal is rejected again in the Commons.