Brexit extension halts UK freight contingency plan

‘No-deal’ measures for logistics sector to be suspended for a second time following EU’s ‘flextension’ offer to delay British departure from bloc until 31 January 2020.

‘No-deal’ Brexit contingency planning related to the freight transport and logistics sector is set to be suspended for a second time after the UK’s formal acceptance of the EU’s ‘flextension’ offer to allow a delay for the UK’s departure from the bloc until 31 January 2020.

Yesterday, ‘Operation Brock’, a plan to manage traffic congestion in the event of disruption to cross-Channel services was activated in preparation for the UK’s exit from the bloc on 31 October, with roadworks carried out on the M20 motorway in Kent last weekend to create a contraflow system for traffic. However, a spokesman for the Department for Transport (DfT) today told Lloyd’s Loading List that following the agreement of a Brexit extension, “the government has taken the decision to stand down Operation Brock as soon as possible.”

Other elements of the so-called ‘Operation Yellowhammer’ plan to prepare for a no-deal Brexit have also reportedly been stepped down.

The new Brexit deadline would also appear to have implications for freight capacity contracts worth up to £86.6 million that the UK government signed with four European ferry companies earlier this month in preparation for a ‘no-deal’ departure on 31 October designed to help ensure the supply of vital medicines. Transport Secretary Grant Shapps had announced that Brittany Ferries, DFDS, P&O and Stena Line “will be ready to deliver capacity equivalent to thousands of HGVs per week from 31 October”. A spokesperson at the time told Lloyd’s Loading List that if there is no longer a need for the government-secured freight capacity, termination of the contracts would cost up to £11.52 million, “considerably less than last time when the original Brexit date of 29 March was extended”.

Asked by Lloyd’s Loading List what the Brexit extension would mean for Brittany Ferries’ contract with the DfT, a spokesman replied: “We have a commercial contract with the DfT. Until we hear otherwise, we will continue to deliver what we are obliged under the terms to deliver. For example, we have changed the schedule on our Poole-Cherbourg sailings, moving from one to one-and-a-half rotations per day.”

Following the aborted 29 March Brexit departure date, the government was forced to pay Brittany Ferries and DFDS £43.8 million to exit the six-month agreements it had signed with the two ferry operators to access freight capacity for urgent supplies in the event of a no-deal exit from the EU – as well as paying £33 million in compensation to Eurotunnel, because of the flawed process for awarding the original contracts.

Meanwhile, there is also the prospect of the UK’s Department of Health and Social Care (DHSC) suspending its £25 million contract to set up an “express freight service” to deliver medicines and medical products into the country in the event of a no-deal Brexit on 31 October and potentially lasting for up to two years. No one at the DHSC was immediately available to comment when contacted by Lloyd’s Loading List.

Source: Lloyd’s