JOANNA Cherry has condemned the UK Government for “dishonest incompetence” after it paid Eurotunnel £33 million to settle a lawsuit over additional ferry services in the event of a no-deal Brexit.

Eurotunnel was challenging the Department for Transport (DfT) decision to award contracts worth £108 million to three ferry companies at the High Court.

It claimed the contracts had been awarded in a “secretive” manner.

The Government has now announced a deal with the firm which involves improvements to security measures and traffic flow at the border.

This will protect the "vital freight capacity" purchased from ferry operators to help ensure the continued supply of "crucial medicines, medical supplies and veterinary medicines in a no-deal scenario", a Government statement said.

SNP MP Joanna Cherry, who is now calling for Transport Secretary Chris Grayling to resign, has repeatedly queried the legality of the tendering process over the last month and demanded that the UK Government publish the relevant legal advice.

READ MORE: SNP's Joanna Cherry says Grayling ‘must face the music’ over ferry fiasco

Upon hearing the news of the £33m settlement, she tweeted: “Turns out I was right. The Tory U.K. Govt have squandered £33 million on this dishonest incompetence. What more does it take to bring a government down?”

Ferry contracts were awarded by the Government in December to DFDS, Brittany Ferries and Seaborne Freight to lay on additional crossings to ports other than Dover.

The deal with Seaborne – which was a start-up company with no ships – was terminated last month after its financial backer Arklow Shipping pulled out.

READ MORE: SNP's Joanna Cherry’s grilling of hapless Tory goes viral

Transport Secretary Chris Grayling, who has overseen the process, commented on the Eurotunnel settlement: "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."

Cherry called for the “incompetent” Tory minister to resign.

“Chris Grayling is incompetent & disingenuous & he must resign. I’ll continue to pursue this when @HouseofCommons resumes on Monday,” she tweeted.

Downing Street said Theresa May still had full confidence in Grayling.

A Number 10 spokeswoman said: "We took the decision to come to an out-of-court agreement to ensure that (the supply of) vital goods would not be put into jeopardy in a no-deal scenario.

"Our view is that a court case would have put at risk that extra vital freight capacity that we have secured already.

"Settling allows us to concentrate on the job at hand of continuing with our no-deal contingency planning."

Downing Street stressed the settlement was "absolutely not" an attempt to keep details of the saga out of the public domain.

It was a "cross-Government decision" to settle the case, the spokeswoman said.

Defending Grayling, the spokeswoman added: "The Transport Secretary is leading his department through some very important projects and work including delivering massive investment in the railway network, securing backing for a third runway at Heathrow and so on."

The Government statement said the "primary reason" for reaching an out-of-court agreement with Eurotunnel was to ensure "vital goods would not be put in jeopardy".

It added: "A lengthy legal case and the uncertainty it creates is not in anyone's interest."