Climate Change Act 2008 (International Aviation and International Shipping) Regulations 2026

Baroness Foster of Aghadrumsee Excerpts

Monday 29th June 2026 Lords Chamber

[Baroness Foster of Aghadrumsee (Non-Afl)]

My Lords, I declare my interest as chair of InterTrade UK, which is beginning a piece of research on ports and connectivity between Northern Ireland and Great Britain. We believe this is an important piece of work, given what has happened in terms of the Windsor Framework.

I will concentrate my remarks on the shipping industry and the lack of methodology, which has been referred to by most of the speakers. That is not a criticism; it is just that I think there are things that need to be put on the record when it comes to adopting a methodology to deal with shipping, particularly in relation to Northern Ireland. As further carbon and climate policies are introduced, it is important that His Majesty’s Government recognise Northern Ireland’s specific circumstances and ensure that the cumulative impact does not disproportionately disadvantage businesses and consumers that rely on maritime services. Around three quarters of goods entering or leaving Northern Ireland do so by sea, meaning that additional costs imposed on shipping are borne ultimately by the exporters, importers and, of course, consumers. Does the Minister and the Government recognise that Northern Ireland has particular geographic and economic circumstances which should be taken into account when the methodology is adopted in relation to shipping?

The existing UK ETS recognises this. It has a 50% concession for Northern Ireland-Great Britain ferry routes. Of course, there is a zero concession for the Highlands and Islands, which we would say should apply to Northern Ireland as well. The existing UK ETS comes into effect this week, on Wednesday 1 July. Maintaining that concession for the industry is a priority and, despite the concession that the UK ETS implementation gives to Northern Ireland traffic, it will add £9 million annually in additional costs to the shipping industry.

It is important that the Government continue to monitor the real-world economic consequences. I hear voices saying that we should not be worried about them. Well, frankly, I am worried about economic consequences for Northern Ireland. There is no stand-alone economic impact assessment of this SI, but given Northern Ireland’s reliance on maritime services, its geography and economic circumstances, it would be very helpful to all if the Government would undertake a dedicated economic impact assessment for Northern Ireland, perhaps in conjunction with the Northern Ireland Assembly, because decarbonisation must be of course environmentally sustainable but also economically sustainable. As the Government pass decarbonisation into law, we must ensure that climate policy does not inadvertently undermine our economic competitiveness across the UK, including, in this instance, in relation to Northern Ireland.

I note from the Secondary Legislation Scrutiny Committee that both the Scottish and Welsh Governments have laid legislation to include international aviation and shipping in their carbon budgets. Can the Minister say what has happened in relation to the Northern Ireland Assembly?

Lastly, in his opening remarks, the Minister said that there will be flexibility between the different sectors impacted by this. Will there also be flexibility within the sectors—in other words, within international aviation and shipping—given our unique position in the United Kingdom? I welcome the debate on this issue and look forward to the Minister’s response.