A TransEuropa ferry berthed in the Port of Ramsgate
More details have emerged about how a secret deal agreed with the ferry company TransEuropa unravelled to leave Thanet council £3.4m out of pocket.
A report setting out events surrounding the saga reveals how the council’s desperate efforts to pursue outstanding debts were frustrated as the company stalled a succession of requests to pay back the money it owed.
Assurances that the money would be repaid were repeatedly broken as the company sought new backers to help it out of its cash crisis.
Meanwhile, the scale of the company’s financial turmoil was underlined by a separate revelation it owed its fuel suppliers $20m at the time it went into administration this year.
According to the council’s report, the authority was concerned about the ferry operator’s financial position several months before it agreed to defer port fees for a three month period.
It set out how “initial discussions began with TEF about its financial viability in November 2010. At this time, the company advised the council it wished to review the tariff agreement as escalating fuel prices were causing them financial difficulties.”
Six months later, the council and the company, which had operated out of Ramsgate Port for 15 years, signed a deal to defer port fees for three months.
Details of the arrangement were kept confidential.
A separate arrangement to deal with the existing debts was also agreed. But a commitment the council would receive regular payments to pay these historic debts on a monthly basis was not met.
Transeuropa informed the council in January 2012 that it had secured new investors. As a result, it would resume paying back money it owed.
Despite this assurance, no money was repaid for five months although three payments of £85,000 were made between July and September 2012.
However, these stopped, leading the council to renew its demands that the company begin repayments.
For full story, see next week's Thanet Extra.