Northern Ireland Protocol Bill

Nigel Mills Excerpts

Committee stage
Wednesday 13th July 2022 Commons Chamber

[Stephen Farry]

I very much agree with the right hon. Gentleman. Our first preference in all these matters should be a UK-wide solution, and only when that is not available, for whatever reason, should we consider something more bespoke for Northern Ireland. We are discussing the protocol, and I reiterate that this issue is very much in the interests of the entire UK agrifood sector, which is an export sector. Many Members talk with great pride about different industries in their constituencies, and all of those are struggling as a consequence of the impact of Brexit. I am labouring the issue of red and green channels, and the veterinary agreement, to point out that solutions are out there and that the measures in clause 4 and elsewhere in the Bill are not necessary. Solutions are there if people have the creativity and willingness to go out and grasp them, especially when that is fundamentally in the interests of us in the UK, as well as being of benefit to the European Union.

Reference was made previously to the Acts of Union, and I wish to clarify a couple of points in that regard as the situation changes over time. The Acts of Union of 1800 were between Great Britain and Ireland, and we are now talking about Great Britain and Northern Ireland, so that is one change we have seen via the Government of Ireland Act 1920, and the more recent Good Friday agreement, the Northern Ireland Act 1998, and the principle of consent, which is the bedrock of that. That is just a precursor, and while I agree fundamentally with the point just made—that our preference should be for a UK-wide approach and solution to some of these issues where possible—we must recognise none the less that Northern Ireland has always, from its inception, done things differently from the rest of the UK in economic matters.

Northern Ireland has always had devolved powers, right from its foundation, and on matters such as employment law or other issues it has had the right to diverge. Further to that, although I am not encouraging checks down the Irish sea, for various reasons throughout our history, including in wartime and other times of stress, there have been checks on certain movements across the Irish sea, including agrifood movements. Indeed, it is accepted practice that farm equipment is inspected. Ireland only really works as a single unit in terms of animal health, and before a lot of the controversy emerged around the protocol, that was an accepted fact for people from all backgrounds in Northern Ireland, as it was the most pragmatic way of doing things. In the same way, the single electricity market on the island has not been a source of debate, although it is a reality that Northern Ireland energy issues are distinct from those in Great Britain, and happen primarily on an all-Ireland basis.

To conclude, I will stress a couple of points. First, if the will is there, the means exist to resolve these issues without going down the route of unilateral action. Under the protocol, there is scope to progress a lot of those issues, including within the current negotiating mandate for the European Commission from the European Council. The question of medicines was progressed without a change in mandate, and the European Union went ahead and legislated for change. Secondly, issues can be addressed through supplemental agreements to the trade and co-operation agreement—the veterinary agreement probably fits that category best. A specialist committee has been set up for that purpose, so a vehicle exists to progress similar issues. While the UK Government have put forward their Command Paper, the European Union put forward its own proposals in October last year, and updated proposals last month.

If clause 4 remains as currently drafted, including the excluded provision, there will be a series of consequences—indeed, there will be consequences from the Bill itself—both for the UK and, in particular, for Northern Ireland. Those will include the undermining of the rules-based international system; setting a very bad precedent by breaching international law; and the risk of a very damaging set of EU retaliations, right through to a full-on trade war. Sadly, we are already seeing the consequences for UK academics and researchers who have been excluded from Horizon Europe. Research has been a real success story for the UK, so the costs are already clear in that regard—costs that are being paid for something that is not necessary, is unworkable, and is counterproductive.

For Northern Ireland, the effects of clause 4 will be as follows: it will undermine our access to the single market and the customs union. It will create more and more uncertainty for businesses as to the legal regime under which they are operating. It will pose dilemmas to members of the Northern Ireland Executive about how they conduct their duties. Finally—I say this with a degree of trepidation—it will beg the question of how and where the interface between the UK economic zone and the European Union economic zone will be managed. The answer to that question may well pose even greater challenges and difficulties.

[Nigel Mills (Amber Valley) (Con)]

It is a pleasure to speak in this debate, Madam Deputy Speaker, and to follow the hon. Member for North Down (Stephen Farry); I agree with some of what he said, if not, perhaps, some of his conclusions. I think that, of all the contents of the Bill, the Government are on the strongest ground when it comes to the clauses we are now debating, and that the EU could have found a way of agreeing with the UK Government how to fix this problem. In the protocol, it was agreed that Northern Ireland was in the UK customs territory, and only goods that were at risk of going into the single market needed to be inspected as they crossed the Irish sea. We ended up with the EU seemingly interpreting everything as possibly being at risk of going into the single market, which produced a ridiculous level of tests that would never be acceptable to the Unionist community of Northern Ireland and are doing the economic damage and causing the tensions we have seen.

It should be obvious and acceptable to both sides that it has been agreed that Northern Ireland will have a foot in both camps: a foot in the EU single market and the EU customs zone, and a foot in the UK single market and the UK customs zone. The only way to make that work is to accept that there is a porous border, where there is no way of exercising the usual level of control that the EU would insist on at its other single market borders around Europe. The key questions for everyone to focus on are these: what goods are we really worried about? What goods have a real risk of crossing that border without being checked—without having the customs declarations and the duty paid, or the various other checks that are required? Finally, how do we put in place measures that can mitigate that risk, and make people on both sides of the border happy that nothing is crossing that border that poses a real threat to the integrity of either market?

To be fair, the UK Government have been extraordinarily generous, not just at the Irish border but at the Dover-Calais border, by not introducing the checks we could have introduced and which we would expect to see at a normal border, because we largely trust goods that are in free circulation in the EU, even if they are not absolutely consistent with UK regulations, either now or in future, or perhaps there is a theoretical customs issue, even though we have a zero-tariff, zero-quota deal, and there may be some duty payable because of rules of origin. We have been extraordinarily relaxed in accepting that those risks are much lower than the risks of trying to impose the burden of huge amounts of checks.

Until we get the EU into the mindset of accepting the same position in relation to goods circulating in Northern Ireland, there is no solution, because at some point there will have to be a border with checks and processes somewhere. We know it cannot be on the island of Ireland. We accepted that trying to make the EU put the border between the European mainland and the island of Ireland would be a horrible situation that the Republic of Ireland could never accept and effectively mean that it had left the single market by mistake, which the Irish Government would never entertain. It always looked to most people that there was the prospect of a compromise by doing something down the Irish sea, where goods spend several hours on a ship allowing for inspections and for declarations to be made, but that it had to be done sensitively and only on the things that were really at risk, otherwise we would end up with the problem we have now, where the Unionist community will not accept it and there is too big a dividing line between the UK mainland and Northern Ireland.

I support what the Government are trying to do and some kind of red and green channel is the right solution. I think the problem we have is that we have extraordinarily little detail about how it will work and how we satisfy the EU that the data we think we can collect and give it is sufficient to get it in a place where it will not have some horrible overreaction. We have not managed to reach an agreement. In fact, I understand it will not even look at our database and the data we could share to see if it is enough to get it there.

We have what looks like a theoretically attractive solution that is the right end position, but we have no idea how to make it work on the ground. We are going from a position where it looked like the EU was going to accept trusted trader exemptions, where everything must be checked and declared unless we have pre-agreed that certain traders are trusted and therefore we can exempt them from it, almost to a position where, if I read red and green right, everything is exempt unless either the trader self-declares that he will go into the single market, or we presumably do some risk-based inspection and spot something that should have been in the red channel in the green channel. It is a stretch to think we will get the EU happy with that without its having serious trust in our internal identification processes.

Then there is the difficult scenario of what happens when somebody changes their mind: goods go into Northern Ireland to be sold in a Northern Ireland store, and then they get low on stock in the Republic of Ireland and decide they want to move them into the Republic. The goods will not have been checked and they will not have done the customs declarations. What will the process be? Where do they go to get the goods checked so that they can legally move them across the border? Or do they just move them, nobody ever checks it, it is all fine and that is that? Again, I would be surprised if we get the EU happy about that. We are going from a position where goods are in free circulation on the island of Ireland, to a position where goods may not be in free circulation on the island of Ireland. How do we fix that?

I urge the Government, as the Bill progresses, to publish the processes for exactly how that will work, and how we can have an effective international border and make the red and green lanes work, so that we can show we are really trying to identify the goods most at risk of cheating or abusing the rules to try to get around them. If we can do that, there is scope to negotiate with the EU and get to the end point that we will inevitably have to get to. Unless the EU wants no border at all or a border on the island of Ireland, it will have to make the system work. That has been apparent for the couple of years since we knew this was coming, but we need to have in place trust between the EU and the UK Administrations, and we need to have the working arrangements and trust between the Irish and the UK authorities in Northern Ireland, so they can work together, trust each other to do joint inspections and share information on a real-time basis—all those common working practices that we have not managed to get to, due to the tensions on both sides, and where we need to get to.

The question we have to ask is: does proceeding with the Bill help us to get towards negotiating a compromised, pragmatic end position or does it make that harder? Fundamentally, I suppose the Government’s answer will be, “We have tried to get the EU somewhere sensible on this matter for the past year or more and we have not managed it. So we will put in place these arrangements and the EU will have a choice: either come and work with us and get to the stage where you are happy with the processes that we have in place and the data we can share with you, or it is just tough—accept what we will offer you.” I sincerely hope, before we do this on a unilateral basis, that at least in this area, where it looks like a compromise should be achieved, we manage to put in place something that both sides are happy with.

[The First Deputy Chairman of Ways and Means (Dame Rosie Winterton)]

I call the shadow Secretary of State.

Northern Ireland Protocol Bill

Nigel Mills Excerpts

Committee stage
Tuesday 19th July 2022 Commons Chamber

[Michael Ellis]

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.

[Nigel Mills (Amber Valley) (Con)]

Will my right hon. and learned Friend confirm what the default position will be if a business has not made an election? Will it operate under EU law unless it positively chooses to use UK regulations? What will the process be for making this choice? Will someone have to file a document with an authority to say that they intend to use UK regulations when they make goods in Northern Ireland? Will there be a public register? Will it be an entirely private choice for a business? Will no one know publicly what they are doing?

[Michael Ellis]

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.

[Nigel Mills]

Will my right hon. and learned Friend give way?

[Michael Ellis]

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.