POLITICIANS in Liverpool have branded port chiefs in Southampton “two-faced” for accepting a £70m European loan to improve the city’s docks.

They have criticised the acceptance of the European Investment Bank (EIB) loan, after a bitter dispute over cruise terminal funding led to Liverpool handing back £8.8m of taxpayers’ cash used for a new cruise terminal.

The “cruise wars” between the two cities began after Southampton campaigned for Liverpool to hand back more than £17m of Government and EU money which funded the creation of the £21m Pier Head terminal.

Southampton’s industry is privately funded, and Southampton Itchen MP John Denham even claimed that allowing the Merseysiders to run turnaround cruises would “breach the principle of fair competition”.

The Government ordered that the £8.8m of public cash be handed back before Liverpool was allowed to continue as a start and finish point for cruises at its Pier Head terminal, and there are still question marks over whether the city has to pay back the £8.6m of EU funds it received for the project.

Now, after the Daily Echo revealed that the EIB, the EU’s bank, has signed off the £70m loan to Associated British Ports (ABP) so it can develop Southampton’s dock, politicians in Liverpool have attacked the acceptance of the money.

The leader of the Liberal Democrat opposition at Liverpool City Council, Richard Kemp CBE, said: “It’s two-faced because of the source of it.

“I don’t see how Southampton can at one stage complain about us getting funding from the European Commission and then get a subsidy by the EU, although through a different institution.

“This decision is just a crude attack on northern development.

“I wouldn’t say that we are complaining about the fact that Southampton gets money, we are saying all of this funding should be on the table, this should be a transparent process.

“I actually think there are ways Liverpool and Southampton could be complementary, but that would involve working together and we’re not going to work with people who have damaged our own bid for funding, as Southampton did by canvassing for us to give back our cruise terminal funding.”

And Chris Davies, one of Liverpool’s MEPs, said: “Liverpool had to pay back £8.8m to the Government because Southampton complained about the cruise liner terminal.

“Maybe now Southampton will ask the Government to hand that money back.

“I wish all good luck to Southampton with this investment but Liverpool will still be the place that cruise liners come to visit while Southampton remains where they go to leave.”

Responding to Cllr Kemp’s comments, ABP’s deputy port director for Southampton, Clive Thomas, said: “This loan from the EIB is exactly what it says it is – a loan which is ultimately repayable.

“That means it’s in no way similar to a grant which allows investment in infrastructure without having to repay that money.”