Northern Ireland After Brexit (Northern Ireland Scrutiny Committee Report)

Baroness Foster of Aghadrumsee Excerpts

Wednesday 25th March 2026 Grand Committee

[Baroness Foster of Aghadrumsee (Non-Afl)]

It is a great pleasure to follow the noble Baroness. I agree with all that she had to say in relation to the issues in the report.

I am delighted to speak to this report as a member of the scrutiny committee. I declare my interests, in particular as chair of InterTrade UK and of Boyce Precision Engineering, and as a member of Co-operation Ireland.

I thank the chair, the noble Lord, Lord Carlile, for the way in which he set out the detail of the report and I echo his thanks to our wonderful committee staff. I want to concentrate on the action taken to mitigate the democratic deficit for Northern Ireland and its people, given that, as we have heard, aspects of EU laws apply in Northern Ireland without the consent of parliamentarians either here or in Stormont.

It is clear from the evidence that we took in our committee and indeed from reports of the Northern Ireland Affairs Select Committee in another place that the arrangements set up to try and mitigate the democratic deficit have, to date, been insufficient. We can never truly deal with the issues arising from the Windsor Framework or the protocol until they are replaced with much more realistic and proportionate arrangements and agreements. Until that happens, we must try to make the mitigations as effective as they can be within the constraints set by these flawed agreements.

When I was reflecting on the comments of the noble Lord the chair at the start of his speech around the Windsor Framework, it reminded me of the old joke: a tourist comes along a country road, sees a farmer hanging over a gate and asks for directions, and the farmer replies, “Well, I wouldn’t start from here”. I think that is certainly the feeling of a lot of us but we have to start from here because that is what we have at the moment.

[Lord Bew (CB)]

I support what the noble Baroness has been saying. There is a problem with democratic deficit but it is perhaps worth reminding ourselves that the leading thrust of the Windsor Framework is not the democratic deficit. It is about the move away from the British Government’s commitment to supporting an island economy. That is there in the 2017 May Government agreement and the 2019 agreement. It is partly concerned with the democratic deficit but it has transformed the shape of, and the debate about, the Northern Ireland economy. These problems of the democratic deficit absolutely remain, as so many speakers, including the noble Baroness, have said, but they are now in a different context. When the NIO Minister, Matthew Patrick, spoke at the British-Irish Parliamentary Assembly, it is striking that when he talked about the relative success now of the Northern Ireland economy he was stressing areas—most obviously defence and fintechs—that are unambiguously part of the British economy.

[Baroness Foster of Aghadrumsee (Non-Afl)]

I thank the noble Lord for that intervention. I agree that that is an important part of the Windsor Framework but, unfortunately, the current architecture of the framework is the product of a number of political developments to try to make it more workable for businesses and consumers. When you try to retrofit solutions on to an already-flawed agreement, it often does not end well. That is, unfortunately, where we are today.

The number of bodies that have been set up have led our report to say that it is,

“a complex and opaque set of arrangements which makes it difficult for Northern Ireland stakeholders to engage effectively with key decision-makers and have their voices heard”.

We attempted to construct a diagram of all the bodies in the report, as the noble Lord the chairman has pointed out, but even that does not do the situation justice in terms of the complexity.

The first task, of course, when there are problems and barriers to trade within the UK internal market, is to have those recognised by our own Government and the European Union. But denial, I have to say, has been a huge source of frustration for businesspeople and consumers alike across the UK: “Barriers—what barriers? Costs—what costs?” That is what you are dealt. When there is an air of denial, the problem is not going to go away. Of course, the difficulties are still there. There are small businesses in particular in GB that have decided to stop supplying goods into Northern Ireland altogether. That was the evidence from the Federation of Small Businesses, which carried out an effective and timely survey across the UK, which it was able to share with the committee. I think members will agree that it was very useful at that time and is surely something that should concern His Majesty’s Government.

As we have heard, some new bodies were set up under the Safeguarding the Union Command Paper, which allowed the Northern Ireland Assembly and Executive to resume operation after a two-year hiatus. The independent monitoring panel looks at data and trade flows in the UK internal market, then provides evidence on the workability of the internal market guarantee, while the organisation I chair, InterTrade UK, provides advice to the Secretary of State for Northern Ireland on issues relating to the operability of the Windsor Framework, as well as looking at connectivity across the UK. InterTrade UK started life without a budget line and with the burden whereby many believed that it had the same powers and resources as InterTradeIreland—it does not. We now have a small budget, for which I am grateful, but it will not be able to match the wherewithal of InterTradeIreland, as the two bodies are totally different entities; InterTrade UK is a non-statutory body.

One of the suggestions from our evidence to the committee is that InterTrade UK should have representation from Great Britain as well as from Northern Ireland; that is the recommendation at paragraph 301—the noble Lord, Lord Empey, was very strong on this issue. We have a lot of trading difficulties with small GB-based companies selling into Northern Ireland, therefore there should be GB representation on the board of InterTrade UK. As the chair of that organisation, I fully support that recommendation and hope that the Government will act on it in their response. The response said that the Government “will give further consideration” to the recommendation at paragraph 301, and I hope the Minister has an update on that.

The work that InterTrade UK has undertaken thus far has been to raise issues of concern to the Secretary of State for Northern Ireland on general policy. In the absence of another vehicle, we have also been raising specific issues that have come directly to our attention. The most recent letter in my name to the Secretary of State was on the availability of white goods in Northern Ireland and the price of pet prescriptions. Incidentally, they have doubled in the instance that was brought to my attention. I hope that the much-anticipated one-stop shop, which has to get going as quickly as possible, will help consumers and businesses alike when it is set up. We await a clear timeline and design—I hope as soon as possible.

One of the most impactive evidence sessions that we had as a committee is not actually in the report before us, because it came after the report was concluded. It was from the Road Haulage Association, which brought forward some very important evidence that I will briefly mention. It told us that the latest Northern Ireland Statistics and Research Agency trade data indicates a sustained decline in GB-NI freight volumes. The increasing administrative and regulatory burden associated with moving goods from GB to NI is acting as a deterrent to operator participation. It showed us that the number of GB-based fleets operating in Northern Ireland has declined by approximately 36%, and that GB-to-Northern Ireland journeys undertaken by GB-registered vehicles had fallen by 52% in 2024.

The Road Haulage Association brought forward a number of issues to us. First, there were issues with commodity codes, particularly for groupage movement and haulage. In this system, each pallet in the truck can belong to a different sender, as Members know, which contains many individual items. While that is efficient commercially, it creates complexity for customs because every item requires its own commodity code. That is why groupage movements face higher administrative burdens and delays, which can cause real issues for an entire truck.

The complexity of that system has been made even worse, because the UK internal market scheme allows businesses with a turnover of under £2 million to use the simpler green lane with some exemptions for certain sectors. Although that is higher than the previous £500,000 limit, it is still far below the UK’s SME classification threshold of £44 million. As a result, many small and medium-sized businesses are excluded from the UK internal market scheme. Of course, larger companies are not affected by all this, because they can manage it, but it is a real issue for the smaller companies.

The recommendations made by the RHA go some way to help mitigate the problems of the Windsor Framework. I ask the Minister, if she cannot respond today, to think about some of these issues and revert back to me. First, the RHA would like to see the introduction of a trusted haulier scheme. The noble Lord, Lord Murphy, also referred to this. It would reduce frictions for logistics and haulage businesses and allow qualifying hauliers to move goods with greater ease at a reduced cost to businesses trading between Great Britain and Northern Ireland.

Secondly, the RHA would like to see that £2 million threshold for the UKIMS removed.

Lastly, and most importantly, the RHA wants to move the determination of “at risk” from the Irish Sea border to the point of sale. Hauliers often do not have the information required to resolve problems when they are bringing goods across the Irish Sea, but determining which goods are at risk at the GB-NI border will always cause costly and disruptive delays, especially for just-in-time goods, which a lot of these are. It brings additional cost and delay in moving goods that risks unbalancing Northern Ireland’s dual market access and trade diversion.

Determining risk at the point of sale would mean that goods’ end destination would be known for sure and that customs processes could be applied only on goods that are leaving the UK and going into the single market of the European Union. Information about the buyer and seller is already required for all movements of goods from Great Britain to Northern Ireland, so there is no lost information from allowing goods to move freely across the Irish Sea.

I have managed to speak to only some of the issues raised in what is a very comprehensive report. I am sure other colleagues will deal with the other issues contained therein. But, in concluding, I always come to these matters in a pragmatic way to try to find solutions to problems, because that is what I think politics is about: trying to find solutions. However, to attain solutions to problems, you first have to acknowledge that there is a problem. I am not sure that there is a willingness in either HMG or the EU to admit the scale and nature of the problem that currently exists. With the much-vaunted reset on its way, I hope the closed mindset on what is happening in Northern Ireland can be lifted and that a more open and balanced dialogue can begin, for the benefit of those British citizens who live in Northern Ireland and businesses right across the UK.

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[Baroness Anderson of Stoke-on-Trent (Lab)]

I believe my party is quite clear on our position on the EU, not least because I believe in international law and complying with our agreements.

One of the issues raised by the noble Baroness, Lady Foster, was on veterinary medicines and the prices going up. She raised a specific case. I should very much like to hear the detail of it because to date, we do not have any evidence of prices going up.

[Baroness Foster of Aghadrumsee (Non-Afl)]

I have written to the Secretary of State about the issue.

[Baroness Anderson of Stoke-on-Trent]

I have not had sight of that question and, apparently, neither has the person who gave me the answer. But online retailers continue to operate in Northern Ireland. As in the rest of the UK, prices between online retailers may vary. We recommend pet owners and others do their research to see which retailer best meets their supply.

The noble Baroness, Lady Foster, and my noble friend Lady Ritchie, as well as the noble Lord, Lord Caine, rightly raised the issue of haulage, logistics and the trusted haulier scheme. We have accepted the recommendations of my noble friend Lord Murphy, in this area and are looking at all possibilities to reduce frictions for logistics and haulage businesses on an ongoing basis. In parallel, we will continue to monitor the effectiveness of the available facilitations. The Government have also established a new Northern Ireland business stakeholders’ group as a formal means of engagement between the Government and Northern Ireland business organisations. This group includes representations from key sectors, including the Road Haulage Association, and provides a direct channel for input into technical UK-EU fora.

The noble Lord, Lord Elliott, raised the issue of animal and livestock movement. He will also be aware that I have met the Ulster Farmers’ Union and some young farmers, and this issue has been raised. The noble Lord will be aware that the best way in which to manage this will be through an SPS agreement and that is why we are seeking to move quickly to deliver on this issue, but I have heard both him and the representations made by others.

The noble Lord, Lord Jay, who previously chaired the committee, as well as the noble Baroness, Lady Ludford, and noble Lord, Lord Rogan, touched, as did other Lords, on the record of regulatory divergence. The Government’s priority is to deliver the enhanced regulatory one-stop shop to advise and support businesses in trading across the whole UK market. We believe that this one-stop shop is far better placed to support small businesses that face challenges. We will seek for this one-stop shop to provide regulatory alerts to businesses on changes to the rules, which we would expect to be accessible to them. The Windsor Framework and a set of online tools provided by the EU can already be used to find regulations of relevance to Northern Ireland. It is for these reasons that our response to the independent review of the Windsor Framework set out that a one-stop shop would be our focus going forward.