Councillors had been close to signing a deal to launch a ferry service with beleaguered Seaborne Freight a year ago before the government's botched attempt to give the firm a £13.8 million contract.

It has emerged Thanet District Council was close to agreeing terms with the firm to run boats from Ramsgate to Ostend in early 2018 - but pulled out amid concerns over the company's finances.

The revelation comes after the government was forced to embarrassingly cancel plans to give the company a contract to run services as part of its no-deal Brexit plans after a string of unwanted headlines about the business.

It emerged the firm had no ships and had never run ferry services shortly after news of Transport Secretary Chris Grayling announced its successful bid.

It also appeared to have the terms and conditions of a takeaway business on its website.

Thanet council's proposed deal with Seaborne Freight foundered when the company declined a contract which required it to pay port berthing fees and other costs in advance.

The government is facing criticism after it scrapped the £13.8m contract after one of the company’s chief investors had backed away.

Now it has emerged that Thanet council had sought safeguards when it was in negotiations with the company about starting up a regular freight service from Ramsgate.

According to the council leader at the time Chris Wells, there was concern there was a risk the authority could be exposed financially.

The talks were at an advanced stage and had reached a point when contracts were drawn up and prepared for signature.

However, the company wanted a different financial arrangement and the negotiations ended.

According to Cllr Wells, the authority was anxious because of its experience with the ferry company TransEuropa.

It collapsed in 2013 owing the council £3.4m in unpaid berthing fees.

Cllr Wells said the contract had strict terms and conditions around it and was put to Seaborne to sign between Christmas and New Year in 2018.

“It involved up front payments three months in advance because of the combination of a start up without due diligence, and the background of wasted funds in the TransEuropa saga.

"It was not signed because Seaborne claimed it would prefer to sign everything together.”

He said the company had not referred at the time to having the backing of the Irish shipping company Arklow.

The prospect of a ferry service was first mooted in October 2017 when the then Ostend Mayor Johan Vande Lanotte announced discussions were underway with a company about operating a service.

But beyond what was termed “a basic agreement” nothing came to fruition.

Seaborne Freight said it could not comment on either the announcement by the Department for Transport or details of earlier discussions.