Seafood exporters across the UK will receive government funding of up to £23 million.
But Alistair Carmichael has described the assistance as the ‘bare minimum’ the government could do.
It follows questions by the isles MP in an urgent debate in parliament last week.
Seafood companies have been left in disarray following a post-Brexit bureaucratic nightmare which has prevented them from exporting their produce to the EU.
Mr Carmichael has raised concerns about the lack of detail on the new funding measures, amid fears that the government would limit claims and seek to invalidate many applications for support.
Mr Carmichael said: “The money is welcome but no one should be in any doubt that this is an admission of failure by the government.”