Latest no-deal medicines freight procurement entrusted to health department

Written by Beckie Smith on 27 June 2019 in News
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Lidington pledges government will only pay for capacity it uses after £50m payout to scrap no-deal ferry contracts

Health secretary Matt Hancock. Photo: PA

The Department for Health and Social Care has said it will draw up new arrangements to transport medicines and other time-sensitive goods from the EU in the event of a no-deal exit from the bloc.

And as DHSC announced its plans to procure an “express freight service”, the Department for Transport said it was putting in place a “freight capacity framework agreement” that other ministries could use to secure services where needed.

The dual announcement came two months after the government paid around £50m to scrap two contracts to similar services in the event the UK had left the EU without a deal on the original leave date of 29 April.


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Announcing the no-deal contingency measures in parliament yesterday, Cabinet Office minister David Lidington said the DfT framework would not commit the government to buying any freight services, but would provide a “flexible list of operators and options for the provision of the capacity that can be drawn upon if needed”.

“This will be an urgent contingency measure for products requiring urgent delivery, within a 24- to 48-hour timeframe, if the UK leaves the EU without a deal,” he said.

And Lidington said DHSC’s plans to procure ferry services would be “part of the department’s multi-layered approach” to preparing for no deal, which would also include measures to reroute medical supplies from short-strait crossings, securing extra warehouse space and  stockpiling medicines, medical devices and other supplies.

A DHSC announcement added: “All these arrangements echo the plans put in place ahead of 29 March and will be essential to the continuation of medicines and medical products if the UK leaves the EU without a deal.”

The government will “only pay for capacity as and when it is needed and used”, Lidington said of the DHSC procurement exercise.

He added that the department would write to businesses with further details of the preparations.

The announcements follow the scrapping of two contracts with the ferry companies DFDS and Brittany Ferries agreed in preparation for the since-extended 29 April deadline.

The two companies had already been running services for a month when their contracts were cut short at the start of May, at a cost of around £50m, as the agreements did not allow for a Brexit extension.

The original procurement exercise was managed by DfT and included a third contract with Seaborne Freight. Seaborne’s £13.8m contract was scrapped at no cost to the department when the company’s financial backers pulled out and it became apparent the company – which owned no ferries – would be unable to secure vessels.

The government later paid £33m to the Channel Tunnel rail operator Eurotunnel in an out-of-court settlement over the handling of the contracts. The settlement, for which DfT racked up nearly £1m in legal bills, requires Eurotunnel to carry out infrastructure improvements that the government has said will help to provide the extra capacity needed in a no-deal scenario.

P&O Cruises is now suing the government over its settlement with Eurotunnel, which the ferry company has said will put its services at a disadvantage.

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Beckie Smith
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Beckie Smith is a reporter for CSW who tweets @Beckie__Smith.

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