The Secretary of State for Foreign, Commonwealth and Development Affairs (Elizabeth Truss)

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I beg to move, That the Bill be now read a Second time.

We are taking this action to uphold the Belfast/Good Friday agreement, which has brought peace and political stability to Northern Ireland. The Northern Ireland protocol is undermining the function of the agreement and of power sharing. It has created fractures between east and west, diverted trade and meant that people in Northern Ireland are treated differently from people in Great Britain. It has weakened their economic rights. That has created a sense that parity of esteem between different parts of the community, an essential part of the agreement, has been damaged.

The Bill will address those political challenges and fix the practical problems the protocol has created. It avoids a hard border and protects the integrity of the UK and the European Union single market. It is necessary because the growing issues in Northern Ireland, including on tax and customs, are baked into the protocol itself. Our preference remains a negotiated solution, and the Bill contains a provision that allows for negotiated agreement, but the EU has ruled out up-front making changes to the text of the protocol.

Elizabeth Truss

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I can absolutely confirm that this Bill is both necessary and legal, and the Government have published a legal statement setting that out.

Elizabeth Truss

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I will make a bit more progress and then allow some further interventions.

We continue to raise the issues of concern with our European partners, but we simply cannot allow this situation to drift. Northern Ireland has been without a devolved Government since February due specifically to the protocol, at a time of major global economic challenges. Therefore, it is the duty of this Government to act now to enable a plan for restored local government to begin. It is both legal and necessary.

This Bill fixes the specific problems that have been caused in Northern Ireland while maintaining those parts of the protocol that are working. It fixes problems in four areas: customs and sanitary and phytosanitary; a dual regulatory model; subsidy control and VAT; and governance. On customs and SPS, the Bill creates a green and red lane system. All those trading into Northern Ireland will be part of a trusted trader scheme. Goods destined for Northern Ireland will not face customs bureaucracy. Goods for the Republic of Ireland and the EU will go through four EU-style border procedures. All data from both the green and red lanes will be shared with the EU in real time as the goods depart from Great Britain. This means that the EU will have this data before the goods arrive in Northern Ireland, ensuring that the EU single market is protected.

Elizabeth Truss

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I was talking about the data that we are sharing with the EU. I am pleased to say that we already have this system in place. We are giving demonstrations to businesses and the EU to show how it works, and I am happy to make those demonstrations available to Members of Parliament as well. Any trader violating the lanes will face penalties and would face ejection from the scheme.

Elizabeth Truss

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As I said at the outset, our preference is for a negotiated solution, and we have sought that for 18 months, but as recently as last weekend the EU has refused to change the text of the protocol. That is why there is strong legal justification, as set out in our legal statement, for us taking this action. Our priority, as the United Kingdom Government, has to be political stability within our own country. While we put this Bill through Parliament, we will continue to seek a negotiated solution with the EU, and there are provisions in the Bill to deliver that. I would strongly encourage my right hon. Friend to raise this with the EU directly and to encourage a negotiated solution, because there is a solution to be achieved. We have laid it out very clearly with our red and green proposal, but we do need the EU to agree to change the text of the protocol. That is the fundamental issue that needs to be addressed.

Elizabeth Truss

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We set out the case extremely clearly in the legal advice, and the doctrine of necessity has been used by other Governments in the past where there is a severe issue and the other party is unwilling to renegotiate that treaty. That is the position we are in with the Northern Ireland protocol. What I would ask the hon. and learned Lady and other Members on the Opposition Benches is this: given that the EU refuses to reopen the Northern Ireland protocol, and issues around customs and tax are specifically baked in, what is their solution for dealing with the real issues in Northern Ireland? We have looked at all the alternative solutions, and the only effective solution is this Northern Ireland Protocol Bill, in the absence of the EU being willing to negotiate a new protocol.

Elizabeth Truss

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My hon. Friend is absolutely right that the protocol is not set in stone. That is why for the past 18 months this Government have sought to achieve negotiated changes to the protocol. In the absence of the EU being willing to change the text, the only way to resolve this matter is for us to legislate.

Elizabeth Truss

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I am going to make more progress, and then I will take more interventions.

We fully understand and respect the legitimate concerns of the EU that the single market should be protected. Our solution does just that. The Bill will also establish a dual regulatory regime so that businesses can choose between meeting UK and EU standards. That removes the barriers to goods made to UK standards being sold in Northern Ireland and it cuts the processes that drive up cost for business. It prevents unnecessary divergence between two parts of the UK internal market. Anybody who trades into the EU single market will still have to do so according to EU standards.

The Bill will also ensure that the Government can set UK-wide policies on subsidy control and VAT, overcoming constraints that have meant Northern Ireland has not benefited from the same support as the rest of the UK. For example, at present people in Northern Ireland are not able to benefit from the VAT cuts on solar panels that the Chancellor announced in the spring statement.

These are essential functions of any 21st-century state, but they are especially important in Northern Ireland, where the UK Government play an outsized role in the local economy. We will maintain the arrangements in the protocol on VAT, which support trade on the island of Ireland while ensuring that Northern Ireland can still benefit from the freedoms and flexibility available in Great Britain.

Elizabeth Truss

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As I have made clear, the Belfast/Good Friday agreement should have primacy. The fact is that it has been undermined over the past two years, as we can see from the fact that the institutions of Northern Ireland are not up and running. That is why the Government need to act, and we are doing so in a reasonable and legal way.

Elizabeth Truss

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I thank my hon. Friend for that point. There are clearly very severe issues in Northern Ireland, including the fact that its institutions are not up and running, which mean that the UK has to act and cannot allow the situation to drift. I do not think that we have heard what the Opposition’s alternative would be, apart from simply hoping that the EU might suddenly negotiate or come up with a new outcome.

Elizabeth Truss

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Perhaps the hon. Lady can give us an idea about her alternative plan.

Elizabeth Truss

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I note that the hon. Lady has not come up with any alternatives to the Bill to move the situation forward. The approach we have taken, with the four areas that I am talking through, is to identify what the practical problems are for the people of Northern Ireland and to come up with solutions that address those problems while protecting the EU single market. It is our expectation that the passage of the Bill will result in the institutions being re-established.

Elizabeth Truss

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I will make progress on talking through the elements of the Bill, but I will be happy to accept further interventions later.

The Bill will ensure that the Government can set UK-wide policies on subsidy control and VAT, which will overcome the constraints that have meant that Northern Ireland has not benefited from the same support as the rest of the UK, as I mentioned. It will also maintain the arrangements in the protocol on VAT that support trade on the island of Ireland, while ensuring that Northern Ireland can still benefit from the freedoms and flexibilities available in Great Britain.

The Bill will remove the role of the European Court where it is not appropriate, including its role as the final arbiter of disputes. That is in line with normal international dispute-resolution provisions, including in the trade and co-operation agreement. The Bill will also enable courts to seek an opinion from the European Court on legitimate questions of the interpretation of EU law, which will ensure that it can still be applied for the purposes of north-south trade.

The Belfast/Good Friday agreement is based on consent from both communities. All Unionist parties have cited the European Court as a main cause of major democratic deficit. Together with VAT and state aid rules, it causes Unionists to feel less connected and less part of the UK. This is not a hypothetical issue; the European Court has already become one of the most controversial elements of the protocol and threatens to disrupt everyday lives. The EU has brought infraction proceedings against the UK in five areas that cover issues such as parcels and transporting pets. To be absolutely clear, the Bill changes only the parts of the protocol that are causing the problems and undermining the three strands of the Belfast/Good Friday agreement.

Elizabeth Truss

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We have published our Government legal statement, which clearly states the reasons why this Bill is legal and the necessity of pursuing this Bill. I return to my point about the lack of alternatives being proposed by the Opposition. We have exhausted all the other avenues, and this remains the course of action that is actually going to deliver for the people of Northern Ireland and re-establish the institutions.

Elizabeth Truss

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My hon. Friend is right. It is very clear from the legal advice that one of the issues is that the EU will not change the text of the protocol even though, when the protocol was negotiated, it was very clear that it was not set in stone and should be subject to change because of the very unique situation in Northern Ireland.

We are very clear that there are elements of the protocol that are working and that we do want to maintain. We will maintain the conditions for north-south co-operation and trade, and uphold the common travel area. We will maintain the functioning of the single electricity market, which benefits both the Republic of Ireland and Northern Ireland.

The Bill provides specific powers to implement technical regulations as part of our solution, and today we launched a consultation with businesses to make sure that the way it is implemented works for the people of business in Northern Ireland. We will continue consulting with businesses and the EU over the coming weeks to make sure that the implementation works.

Elizabeth Truss

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My right hon. Friend is absolutely right. We all know how hard-won peace and political stability in Northern Ireland was, and we all know how important it is that the Belfast/Good Friday agreement is upheld and is not undermined. That is the discussion I have been having with colleagues in the United States and around the world, and those who have experienced the situation in Northern Ireland fully understand how important it is that we act and that we cannot allow this situation to drift.

I know there are those across the House who want to give negotiation more time. The problem we face is that we have already been negotiating for 18 months. We have a negotiating partner that is refusing to change the text of the protocol. Meanwhile, we have a worsening situation in Northern Ireland. So it is firmly the view of this Government that we need to act. We are pursuing this legislation as all other options have been exhausted.

Our first choice was and remains renegotiating the protocol text with the EU. This is in line with the evolution of other treaties, which happens all the time. For example, both the EU and the UK are currently renegotiating changes to the energy charter treaty. Given the unique nature of Northern Ireland and the unprecedented nature of these arrangements, it was always likely that flexibility would be needed. In fact, that flexibility was explicitly acknowledged in the protocol itself, but despite the fact that we have been pursuing these renegotiations we have not seen the flexibility needed from the EU.

As recently as this weekend, the EU said it will not renegotiate the text of the protocol, and Members across the House will have seen that the EU put forward proposals last year and again a fortnight ago; it is worth pointing out that those proposals will leave the people and businesses of Northern Ireland worse off than the current standstill arrangements. Its proposals would make the situation on the ground worse, adding further to the tensions and stresses; goods going solely to Northern Ireland would still face customs paperwork and sanitary and phytosanitary certificates.

Elizabeth Truss

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My hon. Friend is absolutely right. We still face a situation in which the EU has refused to change the text of the protocol, and its proposals do not even address many of the issues of concern—over governance, subsidies, manufactured goods and VAT. Without dealing with those very real issues for the people of Northern Ireland we are not going to see the balance of the Belfast Good Friday agreement restored, and we are not going to see the cross-community support we need to get the political institutions back up and running.

Elizabeth Truss

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The hon. Gentleman makes a very good point. Those who advocate further negotiation with the EU need to persuade the EU to change its negotiating mandate so the text of the protocol can change, because we know that those specific issues, including on the customs bureaucracy and VAT, can only be addressed by addressing the text of the protocol itself.

I want to come on to the specific point the hon. Gentleman made about article 16. Of course we have looked at triggering article 16 to deal with this issue; however, we came to the conclusion that it would not resolve the fundamental issues in the protocol. It is only a temporary measure and it would only treat some of the symptoms without fixing the root cause of the problems, which are baked into the protocol text itself. It could also lead to attrition and litigation with the EU while not delivering sufficient change.

I want to be clear: we do not rule out using article 16 further down the line if the circumstances demand it, but in order to fix the very real problems in Northern Ireland and get the political institutions back up and running, the only solution that is effective and provides a comprehensive and durable solution is this Bill.

Elizabeth Truss

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The reason why I am putting the Bill forward is that I am a patriot, and I am a democrat. Our No. 1 priority is protecting peace and political stability in Northern Ireland and protecting the Belfast/Good Friday agreement. Nothing that the right hon. Gentleman has suggested will achieve that end.

Elizabeth Truss

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I will finish off my remarks.

The only way for us to uphold the Belfast/Good Friday agreement and fix the problems in Northern Ireland is to pass this legislation. We have heard all kinds of complaining from the Opposition side about the solution that the Government are putting forward, but no alternative solution that will deliver.

I want to be clear that this is not my preferred choice, but, in the absence of a negotiated solution, we have no other choice. There is no need for the EU to react negatively. It will be no worse off as a result of the Bill. These issues are very small in the context of the single market, but they are critical for Northern Ireland.

Elizabeth Truss

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I was directly responding to the point made by the right hon. Member for Leeds Central (Hilary Benn) about why I campaigned one way in the referendum and am now working to ensure that the Brexit negotiation that we achieved works for the people of Northern Ireland. That is because I believe in the Union of the United Kingdom and in the relationship between Great Britain and Northern Ireland, and I want to resolve those issues.

All I am pointing out to colleagues across the House is that I have negotiated in good faith with the European Union, but it has refused to change the text of the protocol. I have looked at all the options—including triggering article 16—to see whether they would work to resolve the serious issues in Northern Ireland, and I have come to the genuine conclusion that they will not.

Elizabeth Truss

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The very clear reason why we are acting now is that there has been a refusal to change the text of the protocol, which is causing real problems in Northern Ireland. As I have said, these issues are very small in the context of the single market, but they are critical for the people of Northern Ireland, and it is in their interests that we are acting in putting through the Bill.

Once the legislation is enacted, we can draw a line under the issue and unleash the full potential of our relationship with the EU. Fundamentally, we share a belief in democracy, in freedom and in the right of all countries to self-determination. We are natural allies in an increasingly uncertain and geopolitical world.

Elizabeth Truss

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I will not give way any more—the House will be pleased to hear that I am almost at the end of my remarks. We want to work with the EU for the betterment of not just Europe but the world, and we want to focus all our efforts on tackling external threats, such as Putin’s Russia. Once this legislation is passed, we will have a solution that helps to restore the balance between the communities, and that upholds the Belfast/Good Friday agreement. That is the purpose of the Bill, and I commend it to the House.

The Secretary of State for Northern Ireland (Brandon Lewis)

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I thank all Members who have spoken on Second Reading. I will attempt to respond to as many of the points raised as possible, perhaps leaving out the choice of sandwich that the hon. Member for Hove (Peter Kyle) has been talking about this evening and in various interviews. There have been a huge number of thoughtful and insightful speeches and a wide range of views have been expressed across this House. That shows the interest and the support, certainly from the Conservative Benches, for ensuring a resolution to the issues affecting the people of Northern Ireland.

The Northern Ireland protocol, while agreed with the best of intentions, is causing practical problems for people and businesses in Northern Ireland, including trade disruption and diversion, significant costs and bureaucracy for traders. It cannot be right that it is easier to send goods from Great Yarmouth to Glasgow than to Belfast—still a part, and an important part, of the United Kingdom. Everybody in the United Kingdom should be able to access products and goods in the same way.

Political life in Northern Ireland is, as it has been, built on compromise and power sharing between communities, as the hon. Member for North Antrim (Ian Paisley) outlined, but the protocol does not have the support of all communities in Northern Ireland. As a result, we are seeing both political and social stress in Northern Ireland, including the lack of functioning of both the Northern Ireland Executive and the Northern Ireland Assembly, as rightly outlined by my right hon. and learned Friend the Member for South Swindon (Sir Robert Buckland).

It is clear that the protocol has become a major political problem, and it is putting a strain on the delicate balance inherent within the Belfast/Good Friday agreement. It is worth noting, and it might be forgotten from what some Opposition Members have said today, that all party leaders in Northern Ireland, at some stage or another over the past few months, have been clear that there is a need to change the Northern Ireland protocol. This legislation is about preserving the wider social and political stability in Northern Ireland, finding a more stable and sustainable solution, and ensuring that the frictions faced by businesses and consumers in Northern Ireland on goods coming from the rest of the United Kingdom are removed.

It remains the preference of the UK Government to achieve these benefits through negotiations. These are negotiations that have been conducted by the Foreign Secretary and predecessors over the past 18 months. The lack of flexibility that we have seen from the EU, as rightly outlined by my hon. Friend the Member for Newcastle-under-Lyme (Aaron Bell), has led us to the point where it is right that we make a decision about taking forward a solution that works for the people of the United Kingdom and, within the United Kingdom, the people of Northern Ireland.

This Bill will enable us to implement a successful negotiated settlement as well. It is important to recognise that that will require a significant change in approach from the EU Commission, as a number of hon. Friends have outlined. I am afraid that that change has not yet been forthcoming. The scale of problems and the depth of feelings aroused by the protocol unfortunately, if anything, have been exacerbated, rather than eased by the current EU approach—whether it was through triggering article 16 over crucial vaccine supplies to Northern Ireland in January 2021, launching infraction proceedings following emergency easements to ensure the movement of food and parcels to Northern Ireland in March 2021, or repeatedly failing to show pragmatic flexibility in more than 300 hours of negotiations over the past nine months and continuing to insist on processes that would add to, rather than remove, the burdens currently felt by businesses moving goods to Northern Ireland.

Brandon Lewis

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My right hon. Friend makes a fair point. He will know from attending oral questions to the Northern Ireland Office that I have regularly had to listen to the hon. Member for Hove at the Dispatch Box taking the side of the EU—but then, the hon. Member wants to rejoin the EU, so I suppose we should not be surprised.

We should also be clear about the reality, when we hear about the flexibility of the European Union and the offer it has made, based on its October offer. That would be a backwards step from the current situation, which is already not working for businesses and people in Northern Ireland.

Brandon Lewis

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My right hon. Friend is renowned for always speaking good sense, as he did in that intervention. I can go further; I was given an example not too long ago about the frustration of people in Northern Ireland at not being able to secure a supply of trees from Great Britain to plant in the Queen’s canopy to mark the platinum jubilee, because of the threat to the single market. The last time I saw trees uproot and walk across a border was in “Game of Thrones”—I happily commend the “Game of Thrones” studio tour to everybody in this Chamber when they visit Northern Ireland—but that is not a real threat to the EU single market.

The lack of progress and the subsequent failure of the Northern Ireland power-sharing arrangements is exactly why we as a Government must be prepared to act in the best interests of Northern Ireland and for the stability and delivery of the Belfast/Good Friday agreement.

Brandon Lewis

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We have delivered unfettered access from Northern Ireland to Great Britain. I appreciate that hon. Lady is talking about where we do have real challenges, with goods moving from Great Britain to Northern Ireland. There were flexibilities and vagueness, and some areas of the protocol, in terms of implementation, were not resolved. That was why we had the grace periods, why we had to extend the grace periods and why we now have the standstill. That is exactly why the EU’s offer, which it pretends provides flexibility, is a backwards step from where we are today; and it is why nobody in this House should accept it unless they are determined to do damage to Northern Ireland.

This legislation will fix the practical problems that the protocol has created in Northern Ireland. It will enable us to avoid a hard border, protect the integrity of the United Kingdom and safeguard the EU single market. The right hon. Member for Tottenham (Mr Lammy) spoke at some length—more than half an hour—in his opening remarks, and yet in the totality of those remarks we heard no plan, no proposal and no alternative from the Labour party, just words. The same goes for the hon. Member for Hove.

There were two interesting points, however. The right hon. Member for Tottenham raised Magna Carta to show the importance of treaties. He is right that Magna Carta is an important piece of our history, but he may want to recall that there were 63 clauses in it, and treaties evolve; that is why only four of them remain in place today. He also outlined, and I quote:

“In our discussions, the DUP had consistently said that it wanted a negotiated settlement”.

I gently say to him that that seemed to be a surprise to all the DUP Members, so he learned something else—[Interruption.] He talks from a sedentary position, but he might want to check Hansard.

As I say, what we have heard is an outline of noise without any real proposals or any alternative. Many hon. Members, however, have raised important points around the question of legality, particularly my right hon. Friend the Member for Maidenhead (Mrs May) and my hon. Friends the Members for Bromley and Chislehurst (Sir Robert Neill) and for North Dorset (Simon Hoare). I can assure the House that this Bill is not just necessary, but lawful. Proceeding with this Bill is legal in international law and in support of our prior obligations to the Belfast/Good Friday agreement. The protocol is undermining all three strands of the Belfast/Good Friday agreement, as the right hon. Member for Lagan Valley (Sir Jeffrey M. Donaldson) well outlined, and the institutions that underpin it. It is the Government’s assessment that this Bill is currently the only way to provide the means to alleviate the socio-political conditions while continuing to support the protocol’s overall objectives of including and supporting north-south trade and co-operation, in the interests of both the EU and the UK, by ensuring that we protect its single market while protecting the UK’s internal market. These are all aspects of the Belfast/Good Friday agreement.

We recognise that necessity can only exceptionally be invoked in lawfully justified non-performance of international obligations, as was covered very eloquently by my right hon. and learned Friend the Member for South Swindon. This is a genuinely exceptional situation. It is only in the challenging, complex and unique circumstances in Northern Ireland that the Government have decided to bring forth this Bill. It has always been this Government’s position that should the operation of the protocol or withdrawal agreement be deemed to undermine the Belfast/Good Friday agreement, this would take precedence as the prior commitment under international law. That was outlined back in March 2019 by the then Attorney General and the then Secretary of State for the Department for Exiting the European Union. That was not just the understanding of the UK Government; it was the basis on which the protocol was agreed by both parties. The text of the protocol itself is clear that the Belfast/Good Friday agreement should be protected in all its parts. We should all take note of the important and powerful words of Lord Trimble, an architect of the Good Friday agreement.

Many colleagues have raised article 16. We have always reserved the right to take safeguarding measures under article 16 and have made the case that since the summer of last year, the threshold had been met. This Bill is the most effective, efficient and sustainable way to address the far-reaching problems that have arisen as a result of the application of the protocol. Article 16 in itself does not solve the problems in the way this Bill will. It is not only temporary but starts another process.

Hon. Members such as my right hon. and learned Friend the Member for South Swindon and my hon. Friend the Member for Stone (Sir William Cash) talked about the Northern Ireland Executive and Assembly. We have been clear with all parties in Northern Ireland that we do need to see, and I want to see, the Executive back up and running to deliver for the people of Northern Ireland. That has to be a priority for all of us. We want to see that Assembly and Executive as soon as possible. The people of Northern Ireland deserve a stable and accountable devolved Government who deliver on the issues that matter most to them. It is clear from comments today that this Bill is a key component that will see the Northern Ireland Executive and Assembly return, as we heard from the right hon. Members for East Antrim (Sammy Wilson) and for Lagan Valley. I think we can all welcome those comments. This Bill builds on that work. That is what I have heard in the conversations I have had in meeting all party leaders who want to see Stormont return.

The New Decade, New Approach agreement restored the devolved institutions after a three-year impasse, and we all need to work together to uphold the stability that it provided. We as a Government have a strong record in making sure that the institutions are up and running after too many years of hiatus. The New Decade, New Approach agreement, as set out in legislation, provides for a period of up to 24 weeks for Northern Ireland’s political representatives to restore functioning devolved institutions. I expect the parties to make full use of this time to engage with one another in earnest to restore fully functioning devolved institutions and to develop a programme of government that I have written to all the party leaders to encourage work on.

We do have a role on the international stage. The UK has shown what it stands for in the world, not just with rhetoric but with actions, through our extensive support of Ukraine, our unprecedented offer to those fleeing political instability in Hong Kong, and our leadership of international institutions that is demonstrated again this week at the G7 and NATO summits. We have led the way on climate change, as in so many other areas. That is why it is important, and we are focused on ensuring, that we are acting within the bounds of international law. Indeed, we have repeatedly emphasised that it is only the rare, exceptional circumstances in Northern Ireland that make this intervention necessary.

Brandon Lewis

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Absolutely, and I appreciate the opportunity that the hon. Gentleman gives me to talk about what I said back in January. This highlights exactly the behaviour we expected from the European Union around inflexibility in implementing the protocol. What we have seen since has reinforced that point, and that lack of flexibility and lack of understanding of the nuances of Northern Ireland have led us where we are today. [Interruption.] I gently say to him, while he chunters from a sedentary position, that if he looks at the decisions we took last year to ensure that goods could continue to flow to Northern Ireland, he will see that we took them under criticism from the EU, but they have been vital to ensuring stability in Northern Ireland and access to at least those products that are flown overseas, as international partners have recognised.

The EU has recognised that there are problems with the Northern Ireland protocol; it is just not willing to show the flexibility that is needed to resolve those issues. We are clear that we will ensure that we protect the EU single market, a tiny proportion of which could be deemed to be at theoretical risk. That is why it is important that we get the balance right.

Brandon Lewis

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The hon. Gentleman makes an important point, and it is absolutely our determination that the Bill will ensure a good, flexible free flow of products from Great Britain to Northern Ireland, in the same way that they would move from Great Yarmouth to Carlisle, Birmingham or London. That is what we want to deliver.

One of the reasons we have taken what colleagues refer to as the Henry VIII powers is to ensure that we work with business to make sure that those regulations deliver that free-flowing, flexible process without the bureaucracy that is deterring businesses from accessing Northern Ireland.

Brandon Lewis

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Absolutely, and that is why it was important to have that in the Bill—the right hon. Gentleman is absolutely right. Let us be clear: for just under a quarter of a century, the Belfast/Good Friday agreement has been the foundation of peace, stability and political progress in Northern Ireland. All three strands of the agreement are under threat, as we stand here today, and that is a direct result of the protocol. This Bill is the route to a solution. It is legal, it is necessary and it is right for the United Kingdom. Most importantly, it is not just right for the whole UK; it is right for the people and businesses of Northern Ireland. It creates the environment to facilitate the return of a fully functioning Executive.

While the Opposition have voiced criticisms, they have proposed no alternatives. We are taking the decision to act to protect the hard-won gains of the peace process in Northern Ireland. We owe it to the people of Northern Ireland to fix the problems, and that is why, as Secretary of State for Northern Ireland, I commend this Bill to the House.

Question put, That the Bill be now read a Second time.

The Minister for the Cabinet Office and Paymaster General (Michael Ellis)

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I begin by thanking Members across the Chamber for their participation on Second Reading. I want to allow for thorough debate of the Bill in Committee, and to facilitate that, and because of the plethora of amendments and the number of people who wish to speak, I might not give way as much as I usually do. I want to facilitate the number of amendments and allow people to speak for themselves. I therefore want to make some good progress, because I am duty-bound to go through a large number of amendments in this opening speech.

As we have progressed to Committee—the House will know that the Government have generously allowed no fewer than 18 hours of debate time—it is necessary to reiterate some key points that go to the heart of why the Government have introduced this Bill. The Northern Ireland protocol, as the Committee knows, was agreed with the very best of intentions, but it is causing real problems, as has already been accepted across the House, for people and businesses in Northern Ireland, including trade disruption and diversion, significant costs and bureaucracy for traders. This legislation will fix the practical problems that the protocol has created in Northern Ireland. It will enable us to avoid a hard border, to protect the integrity of the United Kingdom and to safeguard the European Union single market.

Turning to the clauses under scrutiny today, clause 1 summarises the effect of the Bill and gives vital clarity on how it will function. The clause sets out three things: first, that the Bill provides clarity that the specific areas of the Northern Ireland protocol that are causing problems would no longer apply in domestic law; secondly, that it clarifies how other legislation, such as the Acts of Union, are affected by the Bill; and thirdly, that it provides vital clarity on the operation of the Bill and its position in relation to other domestic law.

Clause 2 underpins the essential functioning of the Bill by confirming that any part of the protocol or withdrawal agreement that has been excluded by the provisions of this Bill has no effect in domestic law. That is necessary and technical, but it is vital for the Bill to function, as without that provision, there may be a lack of clarity as to whether the existing protocol and EU law regime or the revised operation of the protocol has effect. Where this Bill or its powers do not exclude provision in the protocol or withdrawal agreement, that provision will continue to have domestic effect via the European Union (Withdrawal) Act 2018, as it does today.

Michael Ellis

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I will give way in due course, if I may, because I will come on to the specific amendments, and it might be more prudent to give way at those points to the individual Members.

Clause 16 supports the functioning of the Bill by granting the power to make new arrangements in any cases where it becomes necessary to use the powers contained in clause 15. That means that new law can be made via regulations, if appropriate to do so, in relation to any element of the protocol or withdrawal agreement that has become excluded provision as provided for in the regulations made under clause 15. Clause 16 is vital to ensure the functioning of the Bill and prevent any gaps in the arrangements established underneath it. Without it, there is a risk of not being able to address properly any new issues arising from protocol provisions.

I thank Members for their contributions. The Government are committed to ensuring that the Bill goes through the appropriate scrutiny, with 18 hours set aside before the summer recess, while balancing the need for urgent action to ensure that protocol issues are rectified as soon as possible. Amendment 1, tabled by my hon. Friend the Member for Bromley and Chislehurst (Sir Robert Neill), amends clause 1 and paves the way for his amendment to clause 26, which we will debate next week and which reflects a desire for Parliament to approve in a vote the provisions in this Bill before they can be commenced. I am cognisant of the fact that it was not two years ago that he famously introduced a similar amendment to another Bill, of which the Government broadly accepted the substance. However, the situation is not the same as it was two years ago.

Now, we face an urgent and grave situation in Northern Ireland, not a hypothetical one. We know that, as it stands, the EU is not prepared to change the protocol to resolve the problems we face—we have tried that repeatedly—and that there is no prospect of seeing a power-sharing Government restored in Northern Ireland if we are unable to tackle those problems. It is a simple fact. We need to be able to move swiftly, using the powers in the Bill to deliver the changes we propose and enable the protocol to operate sustainably.

Michael Ellis

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I am grateful to my hon. Friend for his intervention. “Urgent” does not necessarily mean “immediate”; it means, “As soon as we can reasonably and practically do it.” I think he knows that. I will come to article 16 in due course, but we are going as fast as we can given when the House is sitting.

Additional parliamentary procedures after Royal Assent would risk delays to the regime coming into force, and undermine the certainty and clarity that we are looking to provide through the Bill. That would risk undermining the aim, which we all share, of seeing an Executive back up and running and delivering for the people of Northern Ireland, and risk real harm to businesses and citizens.

Michael Ellis

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If I may, I will make some progress. The amendment is well-intentioned, but I hope the Committee will understand that our priority as a Government is to proceed in a way that best supports the functioning of the Belfast/Good Friday agreement and its institutions, which in this case means giving certainty to the people of Northern Ireland that the regime we propose under the Bill will be in place as quickly as possible. That is why I ask my hon. Friend the Member for Bromley and Chislehurst to withdraw the amendment.

Michael Ellis

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My right hon. Friend is conflating two issues. I will come to necessity in due course.

My hon. Friend the Member for Bromley and Chislehurst also mentioned article 16, and the reality is that it does not solve the problem at hand. It would only treat the symptoms without fixing the root cause of the problems. We need a comprehensive and durable solution to this urgent problem and certainty for the businesses and people of Northern Ireland.

Michael Ellis

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Of course, it takes two sides to discuss such matters and come to a solution. I think it has been accepted by all who have spoken so far that there has been some intransigence on the European Union’s side. That is the clear reality. For example, there have been more than 300 hours of discussions between the parties, over 26 meetings involving my right hon. Friend the Foreign Secretary or her predecessor Lord Frost, and 17 non-papers. I am not sure how much more could be done in terms of negotiation; it does need two sides.

I will move on, as I have several amendments to address and I do not want to interfere with Members’ right to speak in due course.

On amendment 26 and new clause 8, tabled by the hon. Member for Oxford West and Abingdon (Layla Moran), she is right to raise the important issue of this Bill’s relationship with the UK’s international legal obligations. However, the amendment is not necessary. The Government have already published a statement setting out their legal position that the Bill is consistent with the UK’s international obligations. In line with the practice of successive Governments over several years, it summarises our position but does not set out the full detail of our legal advice. That is not something that any Government of any shade can do, and it is quite rare to give such a memorandum.

The statement makes it clear that the strain that the arrangements under the protocol are placing on institutions in Northern Ireland, and more generally on socio-political conditions, means there is no other way of safeguarding the essential interests at stake other than the Bill we propose. There is clear evidence of a state of necessity to which the Government must respond. As in other areas, it would not be prudent for the Government to publish evidence or analysis underpinning every point of legal detail—the lawyers in this House will know that that would be extremely inappropriate—particularly in advance of specific cases arising in potential future litigation. I therefore urge the hon. Lady not to move her amendment.

Michael Ellis

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I will because it is the hon. Lady’s amendment.

Michael Ellis

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It is long-standing convention for very good reason that legal advice is not published in full. We know that, famously, from the Labour Government a couple of decades ago, when there was an enormous controversy about that. It stands as a very good reason, as I have discussed. However, we have published a memorandum on the matter that goes some way towards answering the hon. Lady’s question.

I move on to amendments 31 and 32 and new clause 10, tabled by the right hon. Member for Tottenham (Mr Lammy). The Bill is designed to bring swift solutions to the issues that the protocol has created in Northern Ireland. Those solutions are underpinned by the designation of elements of the protocol as “excluded provision”. Put simply, by excluding some elements of the protocol and withdrawal agreement in domestic law, the Bill is able to introduce, with the necessary certainty, the changes that are needed in Northern Ireland.

These amendments, through the conditions they would impose, would undermine the ability to exclude elements of the protocol and therefore undermine the entire operation of the Bill. The first condition in particular—that provision is excluded only if the EU and the UK agree to it—is obviously unworkable. Negotiations with the EU have so far been incapable of delivering the solutions that are needed, so to set that as a condition would clearly be dysfunctional. The second condition—that provision is excluded only if necessary as part of an article 16 safeguard—also fails to meet the needs of the situation. As I have said, article 16 has inherent limitations in its scope in that such safeguard measures could address some trade frictions, but not the broader identified impacts of the protocol.

In sum, the right hon. Gentleman’s amendments would unacceptably caveat the core operation of the Bill. In other words, they would be wrecking amendments preventing it from delivering the swift solutions in Northern Ireland that it is intended to provide, and that is why I ask him not to press them.

Michael Ellis

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I hope to come to the right hon. Member’s point more specifically in due course, if he will bear with me.

I want first to turn to amendment 5. We have always been serious about negotiations, and we remain so. The whole matter is sensitive and the whole issue is one that we remain serious about. Our preference remains to resolve the issues with the protocol through negotiations, and the Bill provides for this, so I welcome and endorse the sentiment underlying the amendment. It is clear, however, as I have said—I have to emphasise this, because it is not emphasised often enough in my view—that there have been over 300 hours of talks to date, in which the United Kingdom has shared 17 non-papers with our counterparts in pursuit of a solution.

Michael Ellis

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I will not give way.

The European Union is not willing to entertain the changes that are necessary to fix the issues with the protocol, so the Government’s judgment is that, absent a change in stance from the European Union, we have to be realistic. Good faith negotiations to resolve the issues with the protocol have already been exhausted. As I say, there have been 26 separate meetings with the Foreign Secretary and Lord Frost.

Amendment 5 would require that this judgment be endorsed by both Houses of Parliament and, where relevant, the Northern Ireland Assembly, but this would not be appropriate.

Michael Ellis

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I am not giving way, as I have indicated. I will give way in due course.

It has long been the position that the Northern Ireland protocol and negotiations regarding it are, like any other treaty, a matter for the Government, operating under the foreign affairs prerogative. The Executive must retain that prerogative for very good reasons. Because of the protocol, there is anyway no Northern Ireland Assembly currently sitting to provide the consent that this amendment would require. This Bill aims specifically to restore stability in Northern Ireland and a working Assembly—that is the very essence of it—so there is an essential flaw in the amendment’s logic in requiring the Assembly to approve the operation of the Bill. That is why I ask the hon. Member for Foyle (Colum Eastwood) not to press the amendment. Of course, the Government will continue to update Parliament and the Northern Ireland Executive, when they return, on the status of talks with the EU regarding the protocol, and to consult stakeholders in Northern Ireland on the operation of the Bill.

Michael Ellis

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I am very conscious of the time and the number of amendments I have to get through, but I will give way again.

Michael Ellis

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I thank my right hon. Friend for making that point.

With your permission, Dame Eleanor, I will speak to amendment 25 and new clause 7 together, which are in the name of the hon. Member for North Down (Stephen Farry). The Bill is designed, as I have said, to bring swift solutions to the issues that the protocol has created in Northern Ireland. These solutions are underpinned by the designation of elements of the protocol as “excluded provision”. Put simply, it is by excluding some elements of the protocol and withdrawal agreement in domestic law that the Bill is able to introduce, with the necessary certainty, the changes that are needed in Northern Ireland. By requiring the prior approval of the Northern Ireland Assembly, the amendments would undermine the ability to exclude elements of the protocol, and therefore undermine the entire operation of the Bill. That is unworkable. Because of the protocol, no Northern Ireland Assembly is currently sitting to pass the approving resolution that the amendment would require. The Bill as introduced aims specifically to restore stability in Northern Ireland, and a working Executive and Assembly. Therefore, in requiring the Assembly to approve the operation of the Bill, there is an essential flaw in the logic of the amendment.

As the hon. Member for North Down will be aware, the Sewel convention applies to this Bill, as it does to all Bills of this Parliament that intersect with devolved competence. I confirm that in the absence of functioning institutions, senior officials in the Foreign Office have already made contact with the head of the Northern Ireland civil service regarding legislative consent, and we hope to reach a positive solution as soon as the institutions are restored. By contrast, the amendment would allow the Northern Ireland Assembly to constrain the UK Parliament’s power to legislate, even if that legislation related to a reserved matter. That, of course, is wholly inappropriate under devolution arrangements. The Government will consult stakeholders in Northern Ireland, including Members of the Assembly, on the operation of the Bill during its passage and thereafter. I therefore ask the hon. Gentleman to withdraw his amendment.

Michael Ellis

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I will come on to the hon. Gentleman’s question—forgive me; I was distracted. Would he reiterate his point?

Michael Ellis

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My understanding is that Sinn Féin is willing to go back in and has not set preconditions. That is the actuality of the position, rather than the hypothesis raised by the hon. Gentleman.

Michael Ellis

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Forgive me, but may I move on to the issue of necessity, since a number of Members have mentioned that and it may be relevant? On amendment 6, I understand the desire of the hon. Member for Foyle for the Bill to be clear about the powers that it confers to the Government. However, it is essential that the Bill confers necessary powers for the Government to deliver a durable solution to the serious difficulties that the current implementation of the protocol is causing. Those include, as we know, the undermining of the functioning of institutions established by the Belfast/Good Friday agreement.

Amendment 6 confuses an international law concept—the doctrine of necessity, which is long established and well understood—and a domestic statutory one, which concerns the appropriate tests for Ministers exercising powers given to them by Parliament. It is essential that the Bill delivers clarity and certainty for the people of Northern Ireland, and amendment 6 would undermine that. I add the caveat that it is the responsibility of Government to deliver a durable solution to the issues the protocol is causing, in order to protect the Belfast agreement. Any unnecessary additional conditions to the exercise of the powers necessary to deliver that solution will only reduce the clarity and certainty of the Bill and what it does to provide for the people of Northern Ireland. That would undermine our ability to get the Executive back up and running, which is a desire I know we all share. I therefore ask the hon. Gentleman to withdraw the amendment.

Amendments 7 and 14 were also tabled by the hon. Member for Foyle. The Bill will fix the practical problems that the protocol has created in Northern Ireland. That avoids a hard border, protects the integrity of the UK and safeguards the European Union single market. I am therefore entirely sympathetic to the sentiment behind the amendments. The Government are motivated by the same concerns that underlie them. We are moving quickly with this Bill—as quickly as possible. That is our focus, because the situation is pressing.

The power in clause 15, which among other things would allow Ministers to reduce the amount of the protocol that is excluded, is designed to ensure that we are able to get the final detailed design of the regime right. Its use is subject to a necessity test against a defined set of permitted purposes. It is essential that that power can be used quickly if needed. Amendments 7 and 14 would pre-emptively prohibit certain uses of the power, but I submit to the Committee that the proper way to scrutinise its use is in this place. All regulations are subject to scrutiny, under either the negative or the affirmative procedure, so it is not as if anything would be set aside without that scrutiny. The hon. Gentleman’s amendments would also do nothing to resolve a potential clash between the permitted and the unpermitted—for example, a security and global market access intention—so they would risk tying the Government’s hands behind their back just when they would need to be most agile. For those reasons, I ask him to withdraw amendments 7 and 14.

Michael Ellis

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I am sure that my hon. Friend the Member for Bromley and Chislehurst will have heard what my hon. Friend has said.

I will now turn to amendment 27 and new clause 9, tabled by the hon. Member for Walthamstow (Stella Creasy). The Bill is designed to provide swift solutions to the issues that the protocol has created in Northern Ireland. Those solutions are underpinned by the legal designation of elements of the protocol as excluded provision. Put simply, it is by excluding some elements of the protocol and withdrawal agreement in domestic law that the Bill can introduce the changes that are needed in Northern Ireland with the necessary certainty. Through the conditions they would impose, the hon. Lady’s amendments would undermine the ability to exclude elements of the protocol, and therefore undermine the entire operation of the Bill. I would also argue that they are unnecessary, because the actions they require are already being taken in practice during the passage of the Bill. By voting on its passage, both Houses of Parliament have an opportunity to indicate their approval for the principle of excluding elements of the protocol.

The Government have already clearly set out in the statement of 13 June that we consider the legislation to be lawful in international law. We have also already been clear on why we are not using the article 16 safeguard mechanism: it has inherent limitations on its scope, in that such safeguard measures could address some trade frictions but not the broader identified impacts of the protocol. It is therefore unnecessary to oblige the Government to repeat those statements before exercising the powers conferred by the Bill, which is why I ask the hon. Lady to withdraw her amendments.

Michael Ellis

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I commend to the hon. Lady the legal memorandum that was published by the Government. It is, I think, only the second time that a Government of the day has published such a legal document, and it is exceptionally useful. We cannot publish the full legal advice—no Government can do that.

I will now turn to amendment 8, tabled by the hon. Member for Foyle. I certainly sympathise with the intention of the hon. Gentleman’s amendment, but I reassure him that it is also entirely unnecessary. The Government have no intention whatever to use the power in clause 15 to alter the operation of the domestic consent mechanism, which I think answers the point that was made earlier on the Opposition Benches.

Michael Ellis

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My right hon. Friend makes an excellent point, as usual. I have to say that I have never heard those requests.

Amendment 10, again tabled by the hon. Member for Foyle, relates to the Northern Ireland Human Rights Commission and the Equality Commission for Northern Ireland. They are, of course, important and well-respected institutions. They were established on the basis of the Belfast/Good Friday agreement. They undertake important duties and any change to their remit should not happen arbitrarily. The Government engage regularly with the commissions and they have powers to provide advice to the Government on issues arising from article 2 of the protocol. The Government have engaged broadly on the issues created by the protocol with stakeholder groups across business and civic society in Northern Ireland, the rest of the United Kingdom and internationally. In fact, the engagement has been considerable. As the Committee will know, the Bill provides specific powers to establish a new regime in Northern Ireland which addresses the issues with the current operation of the protocol. We are consulting stakeholders on the detail of how the powers are to be used. We will give plenty of notice to those affected in due course. Therefore, amendment 10 would compel the Government to do what, in many cases, they already intend to do.

We are moving quickly with the Bill because the situation in Northern Ireland is pressing. The power in clause 15 that would, among other things, allow Ministers to reduce the amount of the protocol that is excluded is designed to ensure that we can get the final, detailed design of the regime right. Its use is subject to a necessity test against a defined set of permitted purposes. It is designed to provide stakeholders in Northern Ireland with certainty that the Government will deliver the solutions that we have outlined to the problems that the protocol is causing.

It is essential that the power can be used quickly if needed. Although, in normal cases, the Government will of course engage with stakeholder groups in Northern Ireland, there may be occasions when the urgency of a situation means that the Government need to act swiftly. This amendment risks tying the Government’s hands behind their back, and that is why I ask the hon. Member for Foyle not to press it.

Amendment 40 is in the name of the right hon. Member for Tottenham, who I do not think is in his place. This is the first of a number of amendments from him in the same vein, to which the Government have a single view. The amendment would replace the test of “appropriateness” in the use of the Bill’s delegated powers with one of “necessity”. Members should not confuse this with the international law doctrine of necessity, as the right hon. Member is doing.

The question covers well-trodden ground. Members may remember the extended debates on this topic during the passage of the European Union (Withdrawal) Act 2018. The powers there are similar to those in this Bill, the European Union (Withdrawal Agreement) Act 2020 and the European Union (Future Relationship) Act 2020. I note that the House and their lordships in the other place ultimately accepted that the word “appropriateness” in this context was, in fact, appropriate.

The word “necessary”, which this amendment seeks to import, is a very strict legal test for a court to interpret. Where there are two or more choices available to Ministers as to what provision is appropriate to address the issues that the protocol has created, arguably neither one is strictly necessary, because there is an alternative. Ministers need to be able to exercise their discretion to choose the most appropriate course. That is why the word “appropriate” is the correct word.

There are clearly multiple choices in how to replace the elements of the protocol that no longer apply in our domestic law. The Government must propose that which would be the most appropriate choice. That is why we have chosen that word. I therefore ask the right hon. Member not to press his amendment.

Michael Ellis

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I am in full agreement with you, Dame Eleanor, and I am coming rapidly to a conclusion with my points on new clauses 1, 2 and 3, which relate to the Government’s approach to environmental protection and principles as related to the Bill. They introduce new provisions to the Bill that require Ministers of the Crown to provide statements on the environmental impacts of any powers taken under the Bill prior to being able to exercise those.

I understand the desire of the hon. Member for Foyle to ensure that our high environmental standards are upheld across the United Kingdom. In the UK, we already have some of the highest standards of environmental protection in the world. We have no intention of weakening or lowering those standards. The Government are proudly committed to enshrining better environmental protections in law to demonstrate a firm commitment to the highest environmental standards, as we did in the Environment Act 2021.

The UK Government and the Northern Ireland Executive are already held to account by the independent Office for Environmental Protection, which was created under the Act and has a statutory duty to monitor and report annually on progress on improving the environment in accordance with the UK Government’s environmental improvement plans. The OEP also monitors the implementation of, or any proposed changes to, environmental law, and may hold the Government and public authorities to account for serious failures to comply with it. In addition, the Act already creates a duty on Ministers to be guided by five internationally recognised environmental principles when making policy.

In that context, new clauses 1, 2 and 3 are not necessary, as their purpose is served by existing protections, both practical and legislative. I therefore ask the hon. Member for Foyle not to press the new clauses.

May I return very briefly to the consent mechanism, which operates on an international level? We are committed to the 2024 consent vote, which was a principal goal of the Government’s negotiation, as I alluded to a short time ago.

The Financial Secretary to the Treasury (Lucy Frazer)

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I wish to begin by thanking all Members who took part in the debate on Second Reading as well as in the debate in Committee that preceded this one. As we progress to the second day of the Committee stage, I want to reiterate some of the key points that go to the heart of why the Government have introduced this Bill.

The Northern Ireland protocol was agreed with the best of intentions. However, as the right hon. Member for East Antrim (Sammy Wilson) has passionately set out, reinforced by the hon. Member for Strangford (Jim Shannon), unfortunately it is causing real tensions and problems for the businesses and people of Northern Ireland, including trade disruption and diversion, costs and bureaucracy. This legislation will fix the practical problems that the protocol has created in Northern Ireland. It will enable us to avoid a hard border, protect the integrity of the UK and safeguard the EU single market.

Let me address the clauses in turn. The Government’s intention is to introduce a new and different regime, including a green lane for goods remaining in the UK and a red lane for those destined for the EU. Clause 4 will allow the UK Government to implement such a regime for goods remaining in the UK and entering Northern Ireland. The clause, therefore, disapplies in domestic law certain EU law requirements and, with clauses 5 and 6, provides the powers for Government to remove many of the burdens currently placed on businesses by the extensive customs and regulatory processes that are required under the existing Northern Ireland protocol.

Clause 4 also defines “qualifying movements” that will be able to enter our proposed green lane. The subsections remove current burdensome processes for prescribed qualifying movements of UK or non-EU destined goods, and there is a power to define UK or non-EU destined goods. Clause 4 is central to our intention to rationalise the processes for goods moving into Northern Ireland. We have been clear that we do not believe it is appropriate to continue to require full customs and regulatory processes when goods are not even destined for the EU. This clause is part of what will allow us to put in place a more sensible and proportionate regime.

Our green lane and red lane proposals will form the basis of that regime. Engagement with businesses on the detail of the regime is already under way. We know that it is important that we listen carefully. It is the powers in clauses 4, 5 and 6 that will allow us to put it in place.

Lucy Frazer

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Obviously, this is a matter that the Government have been considering very carefully. There are goods, as the right hon. Gentleman says, that will obviously be going to Northern Ireland. Businesses will also know that there is a significant category of goods that will not, and then there are the goods that may not be certain at all. That is something that the Government will be discussing with businesses during the consultation over the summer period, and it will be set out how those goods are dealt with. The hon. Member for Strangford asked us about reducing paperwork, and I can say that, of course, that is the intention of the future regime.

Clause 5 ensures that a Minister of the Crown has the power to make regulations in relation to any provisions to which clause 4 relates, with the exception of customs matters, which are dealt with in clause 6. Clause 5 is essential in enabling a Minister of the Crown to deliver the UK’s proposals for a new green and red lane regime. Taking a power to provide for the regime is required, and the precise detail of the regime will be guided by consultation with stakeholders.

Clause 6 ensures that the Treasury or Her Majesty’s Revenue and Customs can make regulations in respect of customs matters. It will ensure that, once this Bill gains Royal Assent, the Departments can put in place the arrangements needed to operate a coherent customs regime.

Clause 24 sets out the Parliamentary procedure to be followed in respect of the exercise of regulation-making powers related to tax and customs matters in this Bill. The clause provides that regulations making provision in relation to tax and customs matters are to be made by statutory instrument. Regulations would be subject to the affirmative or negative procedure, depending on their effect. These statutory instruments would come before the House of Commons only in line with the exercise of Commons financial privilege, usually given to tax matters.

Before I turn to the amendments, I will touch on a number of points that have been made by hon. Members across the House. My hon. Friend the Member for Amber Valley (Nigel Mills) rightly said that the Government have been very generous and practical in our approach to border checks, not only in relation to Northern Ireland, but more broadly. He is also right to say that we have tried to negotiate a way forward with the EU. We have spent 18 months doing that. We have spent hundreds of millions of pounds on the trader support service, we have spent 300 hours in negotiations and we have shared 17 non-papers. Unfortunately, the EU has not come to an arrangement with us, and that is why I stand at this Dispatch Box today.

I dispute what the hon. Member for Hove (Peter Kyle) says, that it is clear that the two positions can be reconciled. It is clear that they cannot. We have tried to do that, but we have not succeeded. The Foreign Secretary invited Vice-President Šefčovič to the Joint Committee when we announced this legislation. However, the EU proposals do not go forwards; they go backwards. Under the EU’s suggestions, sending a parcel will involve completing a form with more than 50 data fields. A grandmother who wants to send a gift to her daughter in Belfast will need to complete a customs declaration and a pet owner will have to pay £280 for a certificate to take their pet. I welcome the support for this Bill from the right hon. Member for East Antrim and the hon. Member for Strangford.

Dealing now with the amendments, I will first respond to amendment 24, tabled by the hon. Member for North Down (Stephen Farry). I appreciate the intention of his amendment. However, it would be contrary to one of the core purposes of the Bill, which is to disapply in domestic law those parts of the Northern Ireland protocol that require goods remaining in the UK or not destined for the EU to complete burdensome processes.

The amendment would also mean that the “at risk” test would be left in place, which would mean that some businesses moving goods between Great Britain and Northern Ireland would still be required to pay customs duty even when those goods remained in the UK. As the hon. Gentleman will be aware, the Government’s intention is to put in place a different regime, one that is more proportionate and would remove the unnecessary burdens on business created by the protocol. I hope he will therefore withdraw his amendment.

On the points the hon. Gentleman made about the vet agreement, the UK remains open to a negotiated solution. We have put forward a number of practical solutions to resolve outstanding issues on SPS, but the UK has also been clear that we will not commit to dynamic alignment, which would compromise our sovereignty.

I turn now to amendments 34 and 35 in the name of the right hon. Member for Tottenham (Mr Lammy) . The Minister for the Cabinet Office and Paymaster General, my right hon. and learned Friend the Member for Northampton North (Michael Ellis), addressed this issue briefly in the previous debate, so I will not labour the point. Replacing the requirement for a Minister to consider that regulations are “appropriate” in the use of the Bill’s delegated powers with a test of necessity risks our ability to put in place the right solutions to the problems the protocol is causing. In these clauses, that would potentially circumscribe the ability to design a green lane that will preserve the unity of the UK internal market. I expect the right hon. Gentleman will not agree with me, but I ask him to withdraw his amendments.

Amendments 15 to 18 and new clause 5, tabled by the hon. Member for Gordon (Richard Thomson), would remove the Government’s proposed parliamentary procedures for statutory instruments under the Bill relating to tax and customs matters. The amendments attempt, in some cases, to replace them with a new, so-called super-affirmative procedure. In other cases, the amendments attempt to limit them to the draft affirmative procedure, removing the possibility of the made affirmative procedure in cases of urgency.

The drafting of these amendments is defective, making it unclear precisely what procedure is intended to apply to different categories of regulations. However, I will address the principle behind them. As Members will know, true super-affirmative procedures for statutory instruments are vanishingly rare. The normal affirmative and negative procedures for SIs provide effective scrutiny for the House. The hon. Member’s proposed procedure is long, requiring months of consultation on draft SIs, and procedurally complex, but ultimately does little more than envisage a Committee of the House making recommendations and preventing an SI coming into force pending a vote by this House. The amendments would require the Treasury or HMRC to make statements about any representation they have received on the draft recommendations.

I hope I can reassure the hon. Member that the Government intend to consult on the policy—indeed, work is under way—and the usual tools of parliamentary scrutiny will allow him to seek answers about this from me and my ministerial colleagues. His amendments would simply slow down solving the problems facing the people of Northern Ireland and create a muddling precedent on perfectly effective parliamentary procedures. I therefore urge him to withdraw his amendments.

New clause 4, tabled by the hon. Member for Foyle (Colum Eastwood), would prevent the exercising of powers in this Bill until an agreement has been sought on reducing sanitary and phytosanitary checks in the EU-UK Joint Committee—the joint decision-making forum overseeing implementation of the UK-EU withdrawal agreement. In many ways, I agree with the spirit of what the new clause seeks to achieve, but where we differ is that I recognise that we have already exhausted this option. The Government have engaged extensively with the EU on reducing the burden of sanitary and phytosanitary checks both through the Joint Committee and through official-level channels. As I mentioned, we have had over 300 hours of ministerial and official discussions and spent a significant amount of money. Nevertheless, we were still prepared to get round the table with the EU, and we held further talks through the autumn to the turn of the year.

However, as we set out in the statement by my right hon. Friend the Foreign Secretary on 17 May, the EU has simply shown insufficient flexibility. Although the EU published proposals in a non-paper on SPS in October 2021 that claims that checks carried out on SPS goods moving from GB to NI will be reduced by 80%, our own analysis and business feedback shows that this would not be the case in practice, and that a large volume of SPS goods staying in Northern Ireland will still face documentary, identity and physical checks. I understand why the new clause has been tabled, but regrettably we have had to conclude that the solutions put forward by the EU are not sufficient. It is for the EU to come back to the negotiating table or for the UK Government to get on with the job. I invite the hon. Member to withdraw his new clause.

The Bill provides a comprehensive and durable solution to the existing problems with the Northern Ireland protocol. As I said, the protocol was agreed with absolutely the best of intentions, but it is creating real problems on the ground for people and businesses in Northern Ireland. It is creating trade disruption and diversion, and increasing costs and bureaucracy for traders. The Bill will fix those practical problems. It will enable us to avoid a hard border and it will safeguard the EU single market. I therefore recommend that the clauses in this group stand part of the Bill.

Question put, That the amendment be made.

The Minister for the Cabinet Office and Paymaster General (Michael Ellis)

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I begin by thanking hon. Members for their participation in the debate so far. I remind them that, while the Northern Ireland protocol was agreed with the best of intentions, it is causing real problems for people and businesses in Northern Ireland, and this legislation will fix the practical problems that the protocol has created.

On the clauses under scrutiny today, clause 7 makes it clear that businesses will have a choice which regulatory route to follow when supplying goods to the market in Northern Ireland. It introduces a dual regulatory regime in Northern Ireland for regulated classes of goods to which any provision of annexe 2 to the protocol applies. That will create a new option to meet UK rules, compared with the existing protocol arrangements, whereby goods are required to comply with the relevant EU rules. Where the relevant requirements allow, it will also be possible for the same product to simultaneously comply with both UK and EU sets of requirements. Current traders have no choice but to meet EU rules when supplying goods in or to Northern Ireland. This obviously deters some companies, especially those trading exclusively within the United Kingdom. We have seen numerous examples of that already. It deters them from serving Northern Ireland due to the costs and administrative burdens of meeting this EU law such as retesting, re-marking and relabelling of goods, all of which are expensive, as well as the appointment of a representative to undertake administrative duties. All that bureaucracy comes at a cost, which is unnecessary for goods that are to remain on the UK’s market.

The dual regulatory regime provides businesses across the United Kingdom with choice. If a Northern Ireland business trades north-south in the island of Ireland, it can continue to follow EU rules if it wishes and sell its products in the EU and across the UK, because the Government have a commitment to unfettered access. However, if the model of a business is UK-focused, it can choose to follow UK rules and avoid the additional cost and burden currently applied to intra-UK trade.

Michael Ellis

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My right hon. Friend makes a powerful and valid point. The Bill will ameliorate a plethora of problems that have been caused by the protocol.

As my right hon. Friend knows, by providing an alternative UK rules route to market in Northern Ireland, clause 7 protects the integrity of the UK’s internal market. Clause 8 ensures that the protocol no longer prevents a dual regime such as that introduced by clause 7. It makes provision to exclude EU law where it would prevent goods made to UK rules from being placed on the market in Northern Ireland in accordance with clause 7. It means that goods made to UK rules can be supplied in Northern Ireland in accordance with clause 7 to enable the functioning of this dual regulatory regime.

Clause 9 provides a Minister with the powers to make provisions through secondary legislation to ensure the effective working of the dual regulatory routes in Northern Ireland. The dual regulatory regime will need to take into account the results of engagement with business, which we have already undertaken and will undertake much more of, and it will need to be able to evolve over time as UK and EU regulatory regimes change. The default dual regulatory regime may also need to be amended to ensure that it works effectively for different types of goods—for example, should it be required to ensure that specific highly regulated goods regimes can function effectively. So clause 9 is needed to ensure that goods are compliant throughout the supply chain for traders operating under this dual regulatory regime, whichever route is chosen, and it will therefore safeguard the interests of consumer safety and biosecurity arrangements and maintain appropriate public health standards. The clause is essential to ensure the effective working of the dual regulatory routes and protects the integrity of the UK’s internal markets as well as the EU’s single market.

Michael Ellis

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The first thing to state clearly is that no business will be forced to do anything. They will not be obliged to choose one over the other. It will be up to businesses to do that. One power we will give to Ministers in due course, when the Bill has passed, is to make regulations that will fit in most neatly with businesses’ wishes and desires.

Michael Ellis

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If I may, I will make a little more progress.

Clause 9 provides a Minister with the powers to make provisions through secondary legislation to ensure the effective working of the dual regulatory routes in Northern Ireland.

I will move on to clause 10, conscious as I am of the Second Deputy Chairman’s admonition about speed. The clause defines the types of regulatory activity covered by the dual regulatory regime established in the Bill. This provides clarity on interpretation of the Bill’s provisions in relation to the dual regulatory regime and makes the scope of that regime clear.

Clause 10(4) provides that a Minister of the Crown may, by regulations, make provision about the meaning of “regulation of goods” in this Bill, and that includes changing the effect of other provisions of the clause. We want to ensure that the sale of goods made to UK rules in Northern Ireland is not prohibited due to a particular aspect of regulation falling outside the meaning of “regulation of goods” in clause 7. So the power ensures that goods will be able to benefit from the dual regulatory regime.

Michael Ellis

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The hon. Gentleman makes a powerful and succinct point.

Clause 11 gives Ministers appropriate powers to ensure that the regulatory regime in Northern Ireland operates for goods in any given sector, ranging from ball bearings and ice cream to lamp posts, gas cookers and children’s toys—myriad different items, but also intermediate goods such as chemicals. All are regulated in different fashions. We want to ensure that they can all operate effectively. So the powers in clause 11, which I know are controversial in the eyes of some hon. Members, allow a Minister to prescribe a single regulatory route for specific sectors, including a UK-only route with no application of EU law, for example. This can also apply to part or all of a category of goods or to some or all of a regulatory route. We consider the clause vital in ensuring that the dual regulatory regime can be tailored to the needs of industry and ensure the smooth running of the new regime for all sectors.

Michael Ellis

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I will give way, but I am just about to come on to the amendments, so the right hon. Gentleman may wish to wait.

Michael Ellis

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No. Businesses will not be obliged to follow any particular route. They will not be forced to follow either UK or EU regulations. It is a choice, and I should be able to expand on that later.

Amendments 44 and 45 are in the name of the hon. Member for North Down (Stephen Farry). As I have said before, the Government are engaging broadly on the issues created by the protocol with stakeholder groups across business and civic society in Northern Ireland, in the rest of the UK and internationally. I have been to Belfast in recent weeks to discuss this with some industries. We will give plenty of notice to those affected. The clauses need to provide stakeholders with certainty that the Government will swiftly deliver the solutions that we have outlined to the problems that the protocol is causing.

Our preference remains to reach a negotiated outcome with the EU. I emphasise that our door remains open. We need a lasting solution to these issues to restore stability in Northern Ireland and a working Northern Ireland Assembly based on the consent of the communities. Her Majesty’s Government have made proposals that would address the issues with the protocol. So far, I am sorry to say, the European Union has not been willing to agree to those, but there is no reason why it could not do so. We hope that it changes its mind. We are always open to discussions, and we want a shared solution—I cannot be clearer than that. However, amendments 44 and 45 risk tying the Government’s hands behind their back. On consent, I respectfully point out that the Northern Ireland Assembly is not sitting at the moment. It is exactly because of the breakdown of the institutions in Northern Ireland that this Bill is needed. We need to see the restoration of the institutions as quickly as possible. Further to that, I confirmed previously to the House that we hope the institutions will be restored soon and that it will be possible for the Northern Ireland Executive to bring forward, for example, a legislative consent motion. I therefore ask the hon. Member for North Down to withdraw the amendments.

Michael Ellis

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May I put it this way? The Sewel convention applies to this Bill, as it does to all Bills of the UK Parliament which intersect with devolved competence. I respectfully point out that the Northern Ireland Assembly is not sitting at the moment. It is exactly because of the breakdown of the institutions in Northern Ireland that we are where we are right now and this Bill is actually needed. We need to see the restoration of the institutions as soon as possible. I hope that goes some way towards answering the hon. Lady’s question.

Michael Ellis

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Forgive me, but I must make some progress. I am sure that there will be another opportunity to intervene.

Let me turn to amendment 36, in the name of the right hon. Member for Tottenham (Mr Lammy). I addressed this point previously, so I shall be brief. It would potentially circumscribe the ability to design dual regulatory routes under clause 9 to preserve the unity of the UK’s internal market. Given that there are more than 200 pieces of goods regulation applied by the protocol, those powers are needed to ensure that the regime can function effectively in practice for each class of goods. The dual regulatory regime is necessary to remedy disruption to GB-NI trade, which will only worsen as the EU and UK rules diverge over the course of time. The arrangements will also need to be updated over time to reflect changes in UK and EU regulations, so Ministers will need appropriate discretion to make policy decisions in doing so. The right hon. Gentleman may well not agree with me, but I ask him to withdraw his amendment.

I turn to amendment 28, also tabled by the right hon. Member for Tottenham, who I do not think is in his place. The Government have engaged broadly on the issues created by the protocol with stakeholder groups across business and civic society in Northern Ireland, as well in the rest of the UK and internationally. As the House will know, the Bill provides specific powers to establish a new regime in Northern Ireland, which addresses the issues with the current operation of the protocol. We are engaging with stakeholders on the detail of how those powers are to be used and will give plenty of notice to those affected.

The Government have already begun a detailed programme of engagement to inform the specific design of the regime in Northern Ireland that will be created by this Bill. Furthermore, clause 9 is designed to provide stakeholders in Northern Ireland with certainty that the Government will deliver the solutions that we have outlined to the problems the protocol is causing. It is essential that this power can be used quickly if needed. Although in normal cases the Government will engage with stakeholder groups in Northern Ireland, and already are engaging with them, there may be occasions when the urgency of a situation means that the Government need to act swiftly. The amendment risks tying the Government’s hands behind their back.

Michael Ellis

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The right hon. Gentleman makes a powerful point, and it is one with which I tend to agree.

The full details of the new regime will be set out in and alongside regulations made under the Bill, and that includes economic impacts where appropriate. The regulations will be the product of engagement with business. We are going to talk to people to ensure that the detail of the new regime is as smooth and as operable as possible. That is what we are getting on with now. The House will have the opportunity to scrutinise these regulations in the usual fashion, under the normal parliamentary procedures. An additional requirement for the Government to lay an assessment and a report each time, which is what this amendment asks for, would clearly not be necessary. That is why I ask the right hon. Member not to press the amendment.

Let me move on to new clause 13 in the name the hon. Member for Foyle (Colum Eastwood). I argue that this new clause is unnecessary. The hon. Gentleman’s new clause would create a statutory obligation for the UK Government to publish, at least quarterly, what steps are being taken by Her Majesty’s Government to promote, uphold, support and facilitate dual access to the British market and European markets. The Government already publish a host of information on trade, and it is not necessary, in my submission, to duplicate existing publications on a quarterly basis and lay them before Parliament. The dual regulatory regime provides businesses across the UK with choice. If a Northern Ireland-based business trades north-south on the island of Ireland, then they can continue, as now, to follow EU rules and sell their products in the EU and across the UK, because of the Government’s commitment to unfettered access. But if their business model is UK-focused, they can choose to follow UK rules and benefit from the opportunities afforded there. I therefore urge the hon. Gentleman not to press his new clause.

Finally, let me turn to new clauses 14 and 15 in the name of the hon. Member for Foyle. These new clauses are, in some aspects, unnecessary, and, in other aspects, inappropriate. As the hon. Gentleman knows, article 14(b) of the protocol already requires the specialised committee to

“examine proposals concerning the implementation and application of this Protocol from the North-South Ministerial Council and North-South Implementation bodies set up under the 1998 Agreement”.

That is an entirely appropriate and valuable role. The hon. Gentleman’s new clauses, by contrast, would create a statutory obligation for the UK Government to “support” proposals relating to the regulation of goods made by the North-South Ministerial Council and other North-South Implementation bodies.

That would cede control over the UK Government’s stance in the Joint Committee to a council on which the Irish Government—the Government of an EU member state—sits. The hon. Member can surely see that this would be wholly inappropriate. In any case, as part of our “New Decade, New Approach” commitments, the Government already ensure that representatives from the Northern Ireland Executive are invited to meetings of the Joint Committee, which discusses Northern Ireland specific matters, and these are also attended by the Irish Government.

Michael Ellis

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I do not accept the characterisation of the hon. Lady’s point.

The aspects of new clauses 14 and 15 obliging the Government to lay reports before Parliament are also unnecessary. The Government have already committed to—and do—lay written ministerial statements in Parliament before and after each meeting of the Joint Committee. We also provide explanatory memorandums on matters to be discussed at Joint Committee meetings. I therefore urge the hon. Member for Foyle not to press new clauses 14 and 15.

My hon. Friend the Member for Amber Valley (Nigel Mills) asked in an intervention about businesses having a choice. Businesses will, of course, have a choice by default. He asked about processes. We are engaging with businesses. We may need to tailor regulatory routes in some cases, but businesses will have a choice by default.

To conclude, the Bill on which this honourable House is spending up to 18 hours in Committee provides a comprehensive and durable solution to the existing problems with the Northern Ireland protocol by giving businesses a choice over which regulatory route to follow when placing goods on the market in Northern Ireland. I therefore recommend that the clauses under consideration stand part of the Bill.

Michael Ellis

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I am grateful to all the participants in this important debate. Very briefly, I would like to reiterate the following points. No business, including in the dairy sector—I recently visited Lakeland Dairies in Belfast—will be worse off as a result of UK action. The Bill will force no change on any sector, but it will allow Ministers to respond to specific asks from each sector, if appropriate. I have heard strong views about the thoughts of sectors of the Northern Ireland economy, particularly dairy. Understanding such concerns is at the heart of our work; that is why we have been engaging with stakeholders, and will continue to.

May I place on the record my appreciation for the work of the business representative organisations in Northern Ireland, which are doing, and will no doubt continue to do, an important, worthy job on behalf of their members?

While the Northern Ireland protocol was, as we know, agreed with the best of intentions, it is causing real problems for people and businesses in Northern Ireland. This legislation will fix the practical problems that the protocol has created in Northern Ireland.

Question put, That the amendment be made.

The Financial Secretary to the Treasury (Lucy Frazer)

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I thank my right hon. and learned Friend the Minister for the Cabinet Office and Paymaster General for opening the debate this afternoon, and I thank hon. Members across the Committee who have contributed to it.

There has been a lot of talk this afternoon about negotiation. The Government have consistently said that it is our preference to resolve the issues through negotiation. Our door remains open, but the EU has so far not been willing to make changes to the protocol that deliver the solutions Northern Ireland needs. In that context, the Government are acting now to provide the solutions, to be implemented through this legislation, including for fiscal policy.

The reality is that businesses and consumers in Northern Ireland are not currently afforded the same UK tax breaks as those in the rest of the United Kingdom. That is preventing them from reaping the full benefits of this Government’s policies, and this simply cannot continue to be the case. The clauses we are discussing today will enable us to remedy these discrepancies, by paving the way for Northern Ireland to benefit from VAT, excise and subsidy control regimes consistent with those in place in Great Britain.

Let me begin by addressing clause 12. The hon. Member for Hove (Peter Kyle) said that the clause was complicated. It provides the basis for a single UK-wide subsidy control policy rather than the two separate regimes currently existing under the Northern Ireland protocol. The clause will provide legal certainty, and therefore confidence, about the extent to which businesses will be able to receive subsidies. It will provide clarity in domestic law that article 10 is disapplied, meaning that any subsidies that would previously have been notifiable to the EU under article 10 will no longer need to be notified. The clause will also amend section 48(3) of the Subsidy Control Act 2022 so that UK subsidy control requirements will apply to all UK subsidies, including those in Northern Ireland. Clause 12(3) provides powers for a Minister to make appropriate provision regarding any part of the Northern Ireland protocol to which the clause relates.

The protocol creates a two-tier system in the UK under which people and businesses in Northern Ireland are at risk of losing out in comparison with the rest of the UK. EU state aid rules have limited the level of support that may be granted in Northern Ireland without approval from the EU. With the covid-19 recovery loan scheme, for example, there were more limitations on who was eligible for the loans in Northern Ireland than in Great Britain. The Bill will remove that uncertainty for businesses and bring about parity between Northern Ireland and the rest of the UK.

Clause 17 provides Ministers with the ability to ensure that VAT, excise and other relevant tax policy is consistent across the whole UK, including Northern Ireland. That means that people in Northern Ireland will benefit from the same policies as people in Great Britain where it is beneficial for them to do so—as, of course, they should. I would like to explain why that is important. The EU has set rigid limits on VAT and excise rates and reliefs in Northern Ireland, meaning that even if UK policy changes would have no impact at all on the EU, they may not currently apply in Northern Ireland. That is why, as hon. Members across the Committee have mentioned, we still have not been able to introduce the new temporary zero rate for energy saving materials in Northern Ireland, as we have done in Great Britain.

Lucy Frazer

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As the hon. Member will know, because the point has been raised across the Committee over the past few days, negotiations have been taking place for almost two years. There have been 300 hours of negotiations with our EU counterparts, UK officials have shared 17 further non-papers with the European Commission, and we have been attempting to find common ground across these areas. Since the date that the hon. Member mentioned, the Foreign Secretary invited Vice-President Šefčovič to a joint committee meeting, where she announced our intention to table legislation. We would like to resolve the issue through negotiation, but it simply has not been possible.

In future, businesses in Northern Ireland will be subject to new EU VAT, excise and energy tax directives even where they are inappropriate and burdensome for Northern Ireland. That includes forthcoming changes to the application of the EU VAT registration thresholds, which could have a significant administrative impact on businesses in Northern Ireland. Under the Bill, however, we will be able to introduce targeted reliefs to support individuals with the cost of living crisis and achieve net zero, in addition to being able to reform our complicated alcohol duty system, bringing our tax system into the modern era and benefiting the entire UK.

It is not right that there should be unnecessary tax discrepancies between Northern Ireland and the rest of the UK. Clause 17 will enable the Government to lessen or eliminate those discrepancies.

Lucy Frazer

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After this legislation has passed, we will be able to introduce VAT legislation across the UK in the interests of both GB and Northern Ireland. I can assure my right hon. Friend that the Treasury consistently looks at tax policies, including VAT, and the benefits and disbenefits of bringing in changes.

I turn now to amendments 37 and 41 in the name of the right hon. Member for Tottenham (Mr Lammy). I should note that this issue was addressed in a previous debate, so, in the interests of time, I shall aim to be brief. The amendments would restrict the use of the Bill’s powers to only make provision that is “necessary” rather than to make provision that the Minister considers is “appropriate”.

As my right hon. and learned Friend the Minister for the Cabinet Office and I have said previously, “necessary” is a very strict legal test. The amendments would therefore remove the policy discretion for the exercise of these powers, potentially limiting Ministers’ choice of the right solutions to the problems caused by the protocol. Changing the test to an objective one will provide additional uncertainty to businesses and consumers and it would severely limit the ability to facilitate consistent VAT, excise and other relevant tax policies between Northern Ireland and Great Britain, as well as a domestic subsidy control regime that applies to the whole of the UK.

I want to comment on how that was expressed by the hon. Member for Hove, who suggested that Ministers could make changes on a whim. That is simply not the case and is a misrepresentation of the position that is clearly set out in the legislation. Clause 12(3) clearly states:

“A Minister of the Crown may, by regulations, make any provision which the Minister considers appropriate in connection with any provision”.

Therefore, he or she would need to consider those matters very carefully, as Ministers from across the House would do. The amendments might also prohibit the Government from responding in a flexible way to issues facing Northern Ireland. That, in turn, will have a negative impact on Northern Irish businesses and individuals, so I ask the hon. Gentleman to withdraw his amendment.

Many hon. Members discussed the negotiations, and I hope that I have answered those points in my response to the intervention from the hon. Member for North Down (Stephen Farry), The hon. Member for Hove talked about the single electricity market. The right thing to do is not to impact the single electricity market. As the Foreign Secretary has said, we want to cement the provisions in the protocol that are working, including the single electricity market. That is why this Bill does not seek to exclude article 9 or annex 4, which maintain the single electricity market. The Government are committed to preserving it and the benefits that it provides to UK citizens in Northern Ireland.

For those reasons, taken together, these clauses will ensure that the Government can set UK-wide policies on subsidy control and VAT, ensuring that those in Northern Ireland can benefit from the same level of support as those in the rest of the United Kingdom.

The Deputy Leader of the House of Commons (Mr Peter Bone)

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On a point of order, Madam Deputy Speaker. I thought it might be appropriate to draw the House’s attention to a small adjustment to the business tomorrow. Given the progress of the Committee of the whole House, we will now take Third Reading of the Northern Ireland Protocol Bill tomorrow. A supplementary programme motion will be tabled tonight to provide an extra hour of debate tomorrow.

The Minister for the Cabinet Office and Paymaster General (Michael Ellis)

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Allow me, Dame Eleanor, for I think the penultimate time, to thank hon. Members who have spoken in Committee. I would like to turn to the clauses under discussion in this debate. With the leave of the Committee, I will deal with some of the amendments very briefly.

Clause 13 outlines the exclusions that seek to redress the feeling that there is a democratic deficit created by the arrangements for the implementation and enforcement of the protocol. The present role of the Court of Justice of the European Union clearly causes Unionists to feel less connected to, and part of, the United Kingdom. That was reflected in the September 2021 joint statement by all Unionist parties on the protocol. Clause 13 provides that any provision of the protocol that confers jurisdiction on the CJEU over arrangements in Northern Ireland is excluded provision. That means that CJEU decisions, including infractions, will no longer have effect in domestic law across the entire protocol.

I confirm to the Committee that the Bill does not disapply the withdrawal agreement’s arbitration process, which would be convened at the international level in the event of a dispute. It simply affirms that the arbitration provisions in the withdrawal agreement do not have effect in our domestic law, and that is normal for international treaties. It then helps to restore the UK Government’s sole oversight of arrangements on the ground in Northern Ireland, providing that the provisions relating to the powers and presence of EU representatives are excluded. Finally, via subsections (4) and (5), clause 13 allows for the establishment of new arrangements for co-operation with EU authorities to monitor the trade boundary regime, and enables us to implement robust data sharing on the operation of the trusted trader scheme and on all goods moving between Great Britain and Northern Ireland. That will support assurance processes to uphold our commitment to protect both the UK internal market and the EU’s single market.

Clause 14 supports the coherent functioning of the Bill by fully insulating any excluded provision from being brought back into our domestic law as a result of obligations arising from other provisions of the protocol and withdrawal agreement. If needs be, regulations under subsection (4) can be used to make appropriate provision in connection with any provision of the protocol or withdrawal agreement to which this clause relates. The clause provides important clarity on the interaction between excluded provision and any wider provisions in the protocol or withdrawal agreement related to it.

Clause 18 provides a power for a Minister to engage in non-legislative conduct where they consider it appropriate in connection with one or more of the purposes in the Bill. The clause also clarifies the relationship between powers to make secondary legislation under the Bill and those arising by virtue of the royal prerogative. The clause will ensure that actions not requiring legislation, such as issuing guidance to industry or providing direction to officials, can be taken in a timely manner by a Minister of the Crown. It is not, as I think has been misconstrued in some quarters, an extraordinary power. It simply makes clear, as would normally be taken for granted, that Ministers will be acting lawfully when they go about their ministerial duties in support of this legislation.

Clause 20 allows for the proper functioning of domestic court proceedings following the removal of the domestic effect of CJEU jurisdiction. That means that domestic courts would no longer be bound by CJEU principles or decisions when considering matters relating to the protocol. The clause provides a power to make related new provision. Regulations made under the power could, for example, provide for a procedure to refer questions of interpretation of EU law to the CJEU if a domestic court considered it necessary to conclude its proceedings.

Michael Ellis

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If the hon. Member would not mind, I will give way to him when I come on to his amendment specifically. I would be very grateful if he would give me that indulgence.

Clause 20 is important to the functioning of the Bill to allow domestic courts to consider proceedings relating to the protocol without being subject to CJEU jurisdiction, in line with the general principles of the Bill.

I now move on to the amendments in order. Some, with the leave of the House, I can deal with very briefly. Amendments 38, 39, 42 and 43, in the name of the right hon. Member for Tottenham (Mr Lammy) and the hon. Member for Cardiff South and Penarth (Stephen Doughty), would, as has previously been explained regarding similar amendments, in our view wrongly apply a necessity test for the use of such powers. Parliament has previously determined, for example in the European Union (Withdrawal) Act 2018, that “appropriateness” is the appropriate word. That is my response to that series of amendments.

Amendment 12 in the name of the right hon. Member for Leeds Central (Hilary Benn) would remove the power for Ministers to engage in conduct in relation to the protocol which is normally within the Executive’s competence but not otherwise authorised by the Bill. As I explained a short while ago, this provision simply makes it clear that, as would normally be taken for granted, Ministers of the Crown would be acting lawfully when they go about their ministerial duties—for example providing instruction to civil servants or guidance to industry—in support of this legislation. It is not an extraordinary power, but rather it provides certainty that the Government can implement our proposals. I urge the right hon. Gentleman to withdraw his amendment.

Amendment 48 from the hon. Member for Foyle (Colum Eastwood) would be unworkable. It would require the Assembly—which is of course not sitting, which is part of the whole essence of this Bill—to pass a prohibitive number of votes to enable swift implementation of the solutions delivered by the Bill, so I ask him to withdraw the amendment.

Amendment 49 also from the hon. Gentleman would require Ministers to have due regard for the principle that the Belfast/Good Friday agreement should be protected in all its parts. The hon. Member states this amendment is based on the fourth point in the preamble to the protocol which sets out the United Kingdom and the European Union’s affirmation of their commitment to do just that. The Government’s overriding commitment—I emphasise this as strongly as I can—is to protect the Belfast/Good Friday agreement in all its dimensions. That commitment is absolute, but the balance within that agreement, and which was critical to its negotiation, must be maintained, and it is for that very reason that the Government have introduced this Bill. Although I welcome and endorse the sentiment underlying the amendment, it is, for the same reason, unnecessary, and I urge the hon. Member to withdraw it.

Amendment 46 from the hon. Member for North Down (Stephen Farry) would require the Assembly to approve clause 20. That is inappropriate under the devolution settlements because it would prevent the Bill from making important changes that go to the heart of the current democratic deficit. Does the hon. Gentleman wish me to give way now?

Michael Ellis

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I do not accept that characterisation. This is very important to the whole community in Northern Ireland and it is very important that we have cross-community consensus in the working of these operations. I do not accept the premise of the hon. Gentleman’s point.

Michael Ellis

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The right hon. Gentleman is certainly right about the dual regulatory regime, as the Committee discussed at some length yesterday; I agree with his contention.

Michael Ellis

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As I think the hon. Lady knows, this cannot be about majoritarianism, and by the way I note a poll in December 2021 that indicated there was 78% agreement in Northern Ireland that the protocol needed to change. There is a requirement that there is cross-community consensus and—

Michael Ellis

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The hon. Lady is shouting from a sedentary position, but I think I have made the position clear. [Interruption.]

Michael Ellis

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Thank you, Dame Eleanor.

I simply reiterate to the hon. Lady and the whole Committee that our overriding priority is preserving peace and stability in Northern Ireland, and I make no apology for repeating that. The situation as it stands is undermining the Belfast/Good Friday agreement and it is undermining power-sharing, as proven by the very fact that we do not have an operating Northern Ireland Assembly—surely that is proof positive.

Michael Ellis

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The right hon. Gentleman makes his point with his usual eloquence, and the citation he makes from the agreement is irrefutable; it is simply on the face of the document.

Michael Ellis

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The hon. Gentleman is being mischievous in the best possible sense of that word; he is very familiar with the agreement and does not need me to cite the passages in question. I am sure all sides would agree that what is most important is the preservation of the Belfast/Good Friday agreement; that surely is irrefutable.

Amendment 13, tabled by the right hon. Member for Leeds Central, would bind domestic courts into the existing CJEU reference procedure without any choice as to what the new arrangements are. In the Government’s view, that would not resolve the current democratic deficit.

I have given the position of Her Majesty’s Government on the amendments; I hope I have outlined that in sufficient detail. I therefore recommend that these clauses all stand part of the Bill.

Michael Ellis

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I thank hon. Members, who have all spoken passionately. I will try very briefly to address some of their points.

The hon. Member for North Down (Stephen Farry) asked about the impact of CJEU provision on Northern Ireland access to the EU single market. When he raised the point, I reiterated the importance of cross-community consent; I should also reassure him and the Committee that we want and intend to retain elements of the protocol that are working and preserve north-south trade and co-operation. As the Prime Minister has said, we want to fix it, not nix it. The Bill just makes targeted changes to address key concerns and restore balance.

The hon. Member for Strangford (Jim Shannon) raised some technical questions about pharmaceuticals; I will write to him about them.

The right hon. Member for Leeds Central (Hilary Benn) referred to clause 18, which I assure him is genuinely less exciting than some might think. Normally, as he knows, the lawfulness of Ministers’ non-legislative actions can be taken for granted or implied. The Bill is slightly unusual in that it clarifies how new domestic obligations replace prior domestic obligations that stem from international obligations. Those international obligations are currently implemented automatically by section 7A of the European Union (Withdrawal) Act 2018. That conduit pipe currently constrains—and could cause confusion in future as to —how Ministers can act in support of the Bill. Clause 18 will remove that potential confusion.

The hon. Member for Belfast South (Claire Hanna) juxtaposed Northern Ireland with Cyprus. I do not need to say to anyone on the Committee, particularly anyone from anywhere on the island of Ireland, that the history and geography of Northern Ireland is vastly different from that of Cyprus, so it is clear that different issues might arise from the remit of the CJEU. On that note, I recommend that the clauses stand part of the Bill.

Michael Ellis

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Let me, for the last time, thank hon. Members who have spoken in the previous Committee stage debates. I remind hon. Members that, although the Northern Ireland protocol was agreed with the best of intentions, it is causing real problems for people and businesses in Northern Ireland, and this legislation will fix those practical problems.

Let me turn to the clauses under scrutiny this afternoon. Clause 19 gives powers to Ministers to implement a new agreement with the European Union as soon as one can be reached. A negotiated agreement with the EU remains the preferred outcome of this Government and this clause demonstrates that very commitment.

Clause 21 allows for preparatory spending undertaken to support the aims of the Bill to be made proper in the eyes of this place. This ensures that the Government can get on with delivering the new regime as soon as possible for the businesses and people of Northern Ireland.

Clause 22 sets out the general scope and nature of the powers contained in the Bill. This will ensure that the powers have the appropriate scope to implement the aims of the Bill, including setting out that regulations made under the Bill can make any provision that can be made by an Act of Parliament.

Regulations under this Bill may not create or facilitate border arrangements between Northern Ireland and the Republic of Ireland, which feature at the border either physical infrastructure, including border posts, or checks and controls that did not exist before exit day. I know that some Members are concerned about the possibility of border checks on the island of Ireland. This is the clearest possible way to show that this Government will not do that.

Michael Ellis

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Yes, indeed.

Subsection (6) provides that a Minister can facilitate other powers under this Bill to be exercisable exclusively, concurrently or jointly with devolved Administrations to implement the aims of the Bill, and that is our intention where this is possible and appropriate.

Clause 23 sets out the process and parliamentary procedure for regulations made under the Bill, except for those in relation to tax, or customs, or commencement, which have been dealt with in other clauses by the Financial Secretary to the Treasury. Clause 23 will ensure that the appropriate level of parliamentary scrutiny is in place for the different arrangements that will be necessary for the functioning of the new regime.

I will now move on to clause 25, which sets out the definition of relevant terms in the Bill, including by cross reference to their definition in other pieces of legislation. This is a normal and regular feature of all legislation. Clause 26 makes a number of final provisions in the Bill relating to extent and commencement, which are a normal part of all legislation. That clause is vital to ensure the smooth commencement of the new regime and to give business certainty.

Moving briefly to amendments 50 and 53 in the name of the hon. Member for Foyle (Colum Eastwood). This would require approval from the Northern Ireland Assembly before the Bill could come into effect, but the Northern Ireland Assembly is not currently sitting and it is precisely because of this breakdown of institutions that we need this Bill, so I ask the hon. Member not to press the amendments.

Amendment 51 is in the name of the hon. Member for Foyle. This would require secondary legislation under the Bill to be presented to the Joint Committee. It is wholly inappropriate, in our view, to give scrutiny of UK domestic legislation to the EU in this way, as it would effectively give it a procedural veto, so I urge the hon. Member not to press that amendment.

Amendment 55 in the name of the hon. Member for Foyle relates to the role of the North-South Ministerial Council. As the hon. Member knows, the North-South Ministerial Council includes Members of the Government of the Republic of Ireland and, as I said yesterday, it would be wholly inappropriate and a wholly inappropriate role for the Irish Government potentially to veto the Acts of a sovereign United Kingdom Parliament. I therefore urge the hon. Member not to press the amendment.

I will consider amendments 19 to 22 and new clause 6 together. They are in the name of the hon. Member for Gordon (Richard Thomson). My right hon. Friend the Financial Secretary to the Treasury covered similar amendments to clause 24 of the Bill during the first day of debate. I reiterate her comments that the normal affirmative and negative procedures for statutory instruments provide effective scrutiny for the House. I therefore urge the hon. Gentleman not to press his amendments.

I will touch on amendments 2 and 47 in a little more detail. They are tabled by my hon. Friend the Member for Bromley and Chislehurst (Sir Robert Neill) and seek to require a parliamentary vote prior to the commencement of the substantive provisions of the Bill. As I have outlined to the House, the EU is not prepared to change the protocol to resolve the problems we face, and there is no prospect of seeing a power-sharing Government restored in Northern Ireland if we are unable to tackle those problems. We need to bring in solutions as soon as possible to help the businesses and consumers of Northern Ireland. Additional parliamentary procedures would risk delays to the regime’s coming into force and undermine the certainty and clarity that we are looking to provide through this very Bill.

Turning to amendment 47 specifically, it would also set a concerning precedent that, when the legislature has passed legislation, the Executive are not free to bring it into force. That freedom has been a long-standing rule and one that a Government of any party would not wish to depart from. Furthermore, the amendment deviates from the previous one in that, rather than offering this House a single future debate on the issue at hand, it hands an effective veto on most of the Bill to the other place. I understand that some may find that an attractive outsourcing of opposition and a way around the conventions governing relations between the two Houses. However, the Executive , as my hon. Friend is well aware, is grounded in this honourable House and must be able to commence legislation they have agreed with Parliament. I urge him not to press his amendments.

I come now to amendment 33 and new clause 11, in the name of the right hon. Member for Tottenham (Mr Lammy). He is right to raise the important question of the relationship between this Bill and the United Kingdom’s obligations in international law. However, the consistency report that he proposes in his amendment, is unnecessary in our view. The Government have already been clear that the proposals of this Bill are consistent with international law, so I ask him not to press his amendment or the new clause.

I respectfully point out to the hon. Member for North Down (Stephen Farry) regarding his amendments 3 and 4 that, while we need to see the restoration of the institutions as quickly as possible, it is exactly because of the breakdown of those institutions that this Bill was needed in the first place. That is why we cannot have a resolution of the Assembly before it comes into force. His amendments, by contrast, would allow the Northern Ireland Assembly to constrain the UK Parliament’s power to legislate, even if that legislation relates to a reserved matter. That cannot be right; it would be wholly inappropriate under the devolution arrangements, and for that reason and the others I have mentioned I respectfully urge the hon. Gentleman not to press his amendments.

Moving on to new clause 12, and coming rapidly to a conclusion, this new clause is not necessary, as we have been clear that proceeding with this Bill is consistent with our obligations in international law and in support of our prior obligations to the Belfast/Good Friday agreement. The Government have published a summary of our legal position alongside the Bill and would robustly defend our position in any relevant legal proceedings, should they occur. I therefore ask the right hon. Member for Tottenham not to press this new clause.

New clause 16, tabled by the hon. Member for Belfast South (Claire Hanna), would require an impact assessment to be published within six months of making regulations. We are currently engaging with businesses on the detail of regulations, but we need flexibility so that any regulations brought forward as the product of that engagement ensure that the new regime is as smooth and operable as possible.

Penultimately, new clause 17, tabled by the hon. Member for Foyle, would allow the Northern Ireland Assembly to constrain the UK Parliament’s power to legislate on reserved matters. As I have said before, that is inappropriate under the devolution settlements.

New clause 19, tabled by the hon. Member for Foyle, would remove the powers provided by the Bill in the event of a Northern Ireland Assembly vote for continued application of the protocol. This would freeze in place a muddied set of arrangements in Northern Ireland and remove the ability of the UK Government to manage them, so the new clause should also be withdrawn.

This Bill provides a comprehensive and durable solution to the existing problems with the Northern Ireland protocol. The Government remain open to a negotiated outcome with the EU on the protocol, but the urgency of the situation means that we cannot delay. We must act to preserve political stability in Northern Ireland and fulfil our duty to uphold the Belfast/Good Friday agreement. I therefore recommend that these clauses stand part of the Bill.

Michael Ellis

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I beg to move, That the Bill be now read the Third time.

While the debates in Committee have been heated—literally, given the ambient temperature—the exchanges have been productive. Members heard detailed scrutiny of the Bill and the Government’s planned solutions to the problems that the protocol is causing in Northern Ireland. Some Members do not agree with the Government’s diagnosis, but it has been reassuring to note how many Opposition Members do agree and accept the problems, even if they do not currently accept that the Government have no choice but to proceed unilaterally. I can understand that, but unfortunately, while our door is always open, there does not appear to be a fruitful negotiation to be had with the European Union at present.

We have not had a Report stage debate, as the Committee did not see fit to amend the Bill. I, and the Government as a whole, see that as a strong vote of support for our proposals, and we hope that those who are eagerly waiting for them to come to pass in Northern Ireland will take heart in the knowledge that they may not have to wait too long, and that the House of Commons has heard them. I hope that the right hon. Member for Lagan Valley (Sir Jeffrey M. Donaldson) and his party will hear that too, and will continue their moves towards returning to power sharing.

The Bill is a powerful toolkit. I know that there are noble Lords in the other place who might think it too powerful, but the Government have been clear on our policy and the range of detailed regulations that will be required, and these are the tools for the job. The Bill provides certainty that the elements of the protocol that have developed into problems will no longer apply in our domestic law and, alongside that, ensures that the Government can honour their promises to the people of all the communities in Northern Ireland. We will protect that which is working to maintain the economic and social framework for north-south traders and nationalists, and we will fix that which is undermining the lives and livelihoods of east-west traders and Unionists.

This Bill is the Government’s top legislative priority. Given the grave situation in Northern Ireland, it must be so. Negotiations will always remain a possibility, and the Bill ensures that implementation of any agreement will not cause further delays. Negotiations tomorrow are always a day away, but it is today in Northern Ireland and the issues are clearly with us now. In the absence of other comprehensive and durable solutions, the Government and Parliament must act. I therefore commend the Bill to the House.