Brexit & Beyond Newsletter
7 February 2022
Welcome to the 7 February 2022 Brexit & Beyond newsletter
Northern Ireland’s First Minister Paul Givan (DUP) has resigned. Minister for Agriculture, Environment and Rural Affairs Edwin Poots (DUP) has sought to stop checks and controls at NI ports on goods moving from GB to NI. This week’s newsletter also covers the UK Government’s plans for post-Brexit policy and divergence, Common Frameworks, and the impact of Brexit and free trade agreements on the pork and agriculture sector.
NI First Minister resigns
On Thursday 3 February, Northern Ireland’s First Minister Paul Givan (DUP) resigned. In his letter to the Speaker of the Assembly, he writes, “Our institutions are being tested once again and the delicate balance created by the Belfast and St Andrews Agreements has been impacted by the agreement made by the United Kingdom Government and the European Union which created the Northern Ireland Protocol.” His resignation took effect from Friday 4 February.
Former First Minister Paul Givan | Source: NI Assembly
Leader of the DUP Sir Jeffrey Donaldson also gave a speech on Thursday, saying, “If this Irish Sea border is left in place, then the divergence between Northern Ireland and the rest of the United Kingdom will grow and without a single vote cast, the Protocol will have reoriented our supply chains and our economy away from Great Britain.”
Under the power sharing rules, deputy First Minister Michelle O’Neill (Sinn Féin) has also ceased to hold office. The NI Executive cannot meet, but departmental ministers are able to stay in post. The BBC explains the implications of these developments and the consequences of new legislation passing through Westminster. The Assembly election is currently scheduled for 5 May 2022.
Agriculture Minister seeks to stop checks at ports
On Wednesday 2 February, Minister for Agriculture, Environment and Rural Affairs Edwin Poots announced that he had ordered his officials to stop checks at NI ports on goods moving from GB to NI. Business groups told their members that they should continue to comply with their international obligations as traders.
Minister for Agriculture, Environment and Rural Affairs Edwin Poots | Source: NI Assembly
In the Commons on Thursday, Secretary of State for Environment, Food and Rural Affairs George Eustice made a statement confirming that there have been “no operational changes” on the ground while NI Departmental officials seek further advice about Minister Poots’ order. He said, “We very much hope that, in the first instance, implementation can be delivered in its right and proper place through the Northern Ireland Executive.” On Thursday, a European Commission spokesperson said, “It is for the UK Government to ensure the fulfilment of the agreement [the Protocol].” Secretary of State Brandon Lewis has said the administration of SPS checks is for the NI Executive.
As EU-UK negotiations on the implementation of the Protocol continue, European Commission Vice-President Maroš Šefčovič met virtually with UK Foreign Secretary Liz Truss on Thursday. Šefčovič said that Minister Poots’ instruction to cease SPS checks was “very unhelpful”: “It creates uncertainty and unpredictability for the people and businesses in Northern Ireland. These checks are necessary for Northern Ireland to benefit from access to the EU's Single Market for goods.” He stated that the European Commission “will closely monitor the developments on the ground.” The EU and UK are continuing their intensive talks on the Protocol and the chief negotiators will meet again on Friday.
On Friday 4 February, a High Court judge confirmed that checks should continue while a judicial review of the Minister’s action is being considered.
Questions to Ministers: VAT, medicines, student exchanges
On Monday 31 January, Minister for Finance Conor Murphy was asked about VAT relief on energy bills, and how VAT rules under the Protocol restrain Northern Ireland in this regard. Minister Murphy said, “both energy and VAT are included in the protocol to some degree, although they are complex areas. As such, we cannot give a definitive view on whether notification to the EU will be required for the support to be implemented here in the North.” He added that the Joint Committee can regularly review the implementation of VAT provisions.
In a written question, the Minister for Health was asked for his assessment of the impact of the Protocol on Ireland/Northern Ireland on medicine supplies to NI. He stated that his officials have examined the text of the latest European Commission proposals of 17 December 2021, stating, “There are a number of areas which require clarification to be able to ascertain the long term implications of the implementation of the Northern Ireland Protocol for medicines supply. My officials are discussing their assessment of the EC proposal with officials from the Department of Health and Social Care (DHSC). I have also written to the Secretary of State for Foreign, Commonwealth and Development Affairs, Liz Truss, to advise of the key issues which require further consideration or clarification.”
The Minister for the Economy was asked about opportunities for student exchanges under the Turing Scheme and Erasmus Scheme. The Minister said, “In the first year of the Turing Scheme, all of Northern Ireland’s Higher Education and Further Education bids were successful, securing a total of £1.6m of funding to support motilities in Academic Year 2021/22.” He said he has not had any conversations with the Irish Government on their involvement in enabling Northern Irish students to continue to access the EU’s Erasmus Scheme. He noted the Irish Government’s proposals and stated, “Departmental approval would be required for Further Education Colleges to participate in any arrangements developed by the Irish Government.”
Post-Brexit divergence
On Monday 31 January, the UK Government published a 105-page document on ‘The Benefits of Brexit’. It sets out achievements to date, how regulation will be reformed, and the Government’s vision for future policy areas. The paper concludes: “We now have the freedom to be the best regulated economy in the world and to make policy choices that are designed for the UK”, citing reforms in areas such as science, data and technology, infrastructure, climate, the environment, and agriculture.
The report also discusses the review and amending of retained EU law (EU law which was transferred onto the UK statute book after Brexit to ensure continuity and legal certainty). The Commons European Scrutiny Committee has launched an inquiry into the future of retained EU law. The UK Government’s ‘Brexit Freedoms’ Bill will look at ending the special status of EU law. Evidence can be submitted to the committee by 14 March.
The UK in a Changing Europe think tank has published a report on policy after Brexit, looking at where the UK could seriously consider diverging from EU law, policy areas such as immigration and agriculture where Brexit has compelled the UK to establish alternative policies, as well as emerging sectors where both the EU and UK are considering regulatory change.
Common Frameworks and divergence
On Wednesday 2 February, officials from the Department for the Economy briefed the Committee for the Economy on the Late Payments and Company Law Common Frameworks. Common Frameworks are being developed in policy areas which were previously governed by EU law and which intersect with devolved competence. Officials told the committee that to date no advantage is seen in developing separate policy arrangements for Northern Ireland in these areas. They highlighted good working relationships at official level between the Department for the Economy and the Department for Business, Energy and Industrial Strategy (BEIS), which the Common Frameworks formalise, including with a dispute resolution mechanism.
Regarding late payments regulation, officials noted that under EU membership there was not much scope to diverge in this area, and there is no indication from the UK Government to date that they envisage divergence in either of these policy areas in the short term.
Officials were asked about the UK Government’s document on potential divergence (see above) and whether they had any input into the paper. They said they weren’t aware of the document before it was published. Officials are considering the paper to “try and tease out what the potential implications would be – divergence is a very live issue [for the Department]”, particularly with regard to the Protocol and NI’s obligations to follow EU law. Officials noted that a lot of the document is quite aspirational and they would need to see more detail. The committee was told that until the outcome of ongoing EU-UK negotiations is known, “it’s very difficult to a range of people [e.g. the Department, businesses]...to plan ahead for what the implications might be” and uncertainty continues to prevail.
The committee will be contacting stakeholders and academics as they continue to scrutinise these frameworks. The Lords Common Frameworks Scrutiny Committee has written to BEIS Ministers with its recommendations on the Company Law and Late Payments Frameworks.
The UK Government published nine Common Frameworks on Thursday, which fall under the remit of the Department for Agriculture, Environment and Rural Affairs.
Brexit impact on the pork sector
On Thursday 3 February, the Committee for Agriculture, Environment and Rural Affairs heard evidence from the NI Pork and Bacon Forum on workforce issues. Minister Poots recently outlined the pressures facing the sector. Chief Executive of the Forum Deirdre McIvor said the consequence of Brexit, and losing access to labour from Europe and also globally, is “having severe impacts on the industry”. She said the three-month period that the UK Government proposed for visas for temporary workers was too short. McIvor said that they “really need things done to try and get access to these workers because the indigenous work supply is just not here on the home markets”.
McIvor was asked about the Minister’s decision to withdraw checks at ports. McIvor said she was “bewildered” and added, “I would say our industry, and I know other industries will say, we need the Northern Ireland Protocol: we need it so that we can trade, we need it so that we can trade on an island basis…and across the UK.” She pointed out that from the perspective of credibility, verification and checks are important.
FTAs
McIvor raised concerns that in seeking to broker free trade agreements with countries like America which want to bring their products here, sectors “would be traded off in favour of some other critical quota they [the UK Government] might have”.
The Department for the Economy has submitted evidence to the Commons International Trade Committee on the UK’s Free Trade Agreement (FTA) with Australia. It states that the FTA “does not deliver on UK interests as sensitive agriculture sectors are not given sufficient protection from imports.” The Department concludes: “Ultimately, the interaction between the provisions of UK Free Trade Agreements and Northern Ireland’s legal obligations under the Protocol are complex and create uncertainty in two key regards: firstly, the extent to which NI importers and consumers can access the full range of goods covered by the agreement, and; secondly, the effect on the competitiveness of NI suppliers within the UK. With limited success, officials continue to press their UK counterparts for greater clarity and assurances around the interaction of trade policy and the Protocol”. Further submissions to the Committee can be read here.
This Week at the Assembly
- Tuesday 8 February, 2PM – Plenary - Question Time - Agriculture, Environment and Rural Affairs
- Thursday 10 February, 10.30AM - Committee for Agriculture, Environment and Rural Affairs - Animal Health & Welfare Common Framework - Stakeholder Oral Evidence Session
Catch up with Assembly Business
- Wednesday 2 February, 10.05AM - Committee for the Economy - Departmental Briefing on Common Frameworks: Late Payment Policy and Company Law
- Wednesday 2 February, 12.30PM - Committee for Infrastructure - Motor Insurance (Compulsory Insurance) Bill: Written Briefing
- Thursday 3 February, 10AM - Committee for Agriculture, Environment and Rural Affairs - Workforce Labour Issues: Oral Briefing from NI Pork and Bacon Forum; Radioactive Substances Framework: Draft Committee Position Paper
