Brexit & Beyond Newsletter

21 March 2022

Welcome to the 21 March 2022 Brexit & Beyond newsletter

The Committee for Infrastructure held a session on issues facing the freight and haulage sector. The Committee for Agriculture, Environment and Rural Affairs continues to hear evidence from stakeholders as part of its scrutiny of Common Frameworks. The Committee of the Regions’ UK Contact Group was hosted by the Senedd. The Commons European Scrutiny Committee has raised concerns about EU legislation which may be applicable in Northern Ireland under the Protocol.

Issues facing the freight and haulage sector

On 16 March, the Committee for Infrastructure received an update on issues facing the freight and haulage sector. John Martin of the Road Haulage Association (RHA) told the Committee about five key concerns relating to Brexit and the Protocol on Ireland/Northern Ireland: bureaucracy, cost, time, environmental impact, and sector fatigue. He said the RHA is not pro or anti-Brexit, or the Protocol, but has been consistent in its message: “our basic ask is that we ensure the free movement and unrestricted movement of goods between our main market GB and Northern Ireland.” He added that in its current format, the Protocol is “undermining many Northern Ireland businesses”. He explained that disruption to the supply chain means that vehicles are not taking the shortest route to market which adds time, cost and delays to just-in-time deliveries, and causes a reduction in logistics capacity and an increased impact on the environment.

Peter Summerton, Managing Director of McCulla Ireland | Source: NI Assembly

Peter Summerton, Managing Director of McCulla Ireland, said the new regime has impacted efficiency and now planning has to be done days in advance. Mr Summerton showed the Committee the paperwork required for one load: “just to demonstrate to people, the number of signatures, the number of stamps, the number of difficulties there are with bringing product across the Irish Sea”. He said, “We’re trying to apply international legislation to a regional economy”. Summerton highlighted that the retail sector is still operating under easements, which “hides from public view the impact the trade restrictions actually have.” He said the full brunt has been borne by a minority of trade. Of particular concern is the movement of products from the rest of the world via GB to NI, which is prohibited unless further processed in GB. Summerton said the rules on this were changed and this wasn’t communicated to traders. He said this has major implications for the movement of products between Great Britain and Northern Ireland, which “effectively could affect thousands of retail products on our shelves.”

Mark Tait, Director of Target Transport, pointed out that the Trader Support Service (TSS) is not designed for groupage and that when the government scheme ends, the cost for a small company to move one pallet could increase to £175. He said after months of discussions, they still don’t know what is going to happen for GB-NI goods: “when you don’t know the information, you can’t plan”. Tait argued that the Protocol could have advantages, but his business is mostly on the GB-NI route and at the moment, “there's a lot of northern companies feeling all the pain, with no gain”.

Regarding proposed changes to the Protocol’s operation, Summerton said that lighter touch controls at ports would mean controls move upstream to manufacturers and suppliers. He said, “it might look good on paper” but would be concerned about asking UK companies to do something different for 2% of the market, which NI represents. 

Common Frameworks

On 16 March, the Committee for Agriculture, Environment and Rural Affairs heard views from stakeholders on the Organic Production Provisional Common Framework. Common Frameworks are mechanisms for the UK and devolved governments to agree regulatory consistency in policy areas where returning EU powers are within devolved competence. On the possibility of divergence and its potential impact on GB-NI trade, Maeve Cairney of the Irish Organic Association said if there are changes to retained EU organic regulations in GB, that will have an impact on possible trade with NI, and then potentially on trade from NI to the rest of the island of Ireland. She also raised the possibility of a GB organic logo and labelling requirement, explaining that there is currently an EU-wide organic logo which can be used by all operators certified under EU regulations (including products produced in GB). Cairney said she was concerned about availability of the new GB logo to NI operators and said there should be no unfair advantage.

Maeve Cairney of the Irish Organic Association | Source: NI Assembly

Roger Kerr of OF&G Organics said there doesn’t appear to be a recognised resolution process in the framework document, which causes some concern. His colleague Stephen Clarkson said if GB moves even further away from the 2018 regulations on organic production, “that could have significant impact on organic production in Northern Ireland.”

David Laughlin of Culmore Organic Farm said they would strongly welcome input from the Republic of Ireland, given NI’s land border with the EU. Engagement with the Republic of Ireland is something which the Lords Common Frameworks Scrutiny Committee has previously raised with the Department of Agriculture, Environment and Rural Affairs and with UK Government Minister O’Brien, who oversees the frameworks programme.

Divergence challenges

Stephen Clarkson explained that NI now operates under EU regulation 2018/848, while the rest of the UK still operates the original organic regulation 834. There is “significant divergence already”, he said, explaining that GB can still use 5% non-organic protein feed for poultry: even this small percentage increases the cost of production, which impacts livestock products coming from NI to GB to be sold. He told the Committee that there are “compact, long supply chains for bringing in a lot of the [organic] ingredients into the EU” and the trade agreement has also caused issues: “if a product comes into Great Britain….and that's not further processed, it's then not allowed to be exported to Northern Ireland.” Previously the European Scrutiny Committee wrote to the UK Government Minister about the change in EU regulations and their implications for trade in organic products between GB and NI.

Asked about potential difficulties if GB changed its definition for organic producer certification and NI maintained EU regulations, Laughlin said the main impact would be increased cost, adding to already increased costs associated with shipping from mainland UK, and increased food costs since the Protocol started. Clarkson highlighted that if GB regulations change, there would be more issues for products moving GB-NI. He pointed out that certification bodies (CBs) operating in GB would have two completely different systems to work with, which increases their costs: “we know that one of those CBs has already said that they will no longer work in in Northern Ireland…and that clearly could happen with other CBs, if it's more complex and more expensive”.

Parliamentary Scrutiny

The Committee for Agriculture, Environment and Rural Affairs has published its position papers on the Common Frameworks on Radioactive Substances; Fertilisers; Chemicals and Pesticides; the Joint Fisheries Statement and Fisheries Management and Support; Animal Health and Welfare; and Agricultural Support. These documents can be read on the Committee’s webpage.

The House of Lords Common Frameworks Scrutiny Committee has written to the Secretary of State for Environment, Food and Rural Affairs George Eustice about the Fertilisers Common Framework, raising concerns that the framework does not provide enough information about its interaction with the Protocol. The Committee also highlights “the importance of communication with the Republic of Ireland on fertilisers, especially as NI will be diverging on fertilisers in July, and because the island of Ireland is considered one epidemiological unit from a public and animal health standpoint.”

The Lords Committee has also written to Minister Neil O’Brien, again raising concerns about the lack of engagement with the Irish Government. It notes this has taken place for one framework (public health) but not others, stating, “Engagement with the Irish Government on certain common frameworks has therefore, it appears, fallen through the cracks”. The Committee also asks for an update on the UK Government’s policy on reporting and monitoring divergence resulting from the Protocol. The Committee enquires about the implications of the Brexit Freedoms Bill on the frameworks and divergence, and the timeline for the remaining frameworks.

The Commons Environment, Food and Rural Affairs Committee is seeking views from interested individuals and organisations on the DEFRA Common Frameworks until 8 April 2022.

Legislative implications of the Protocol

The Commons European Scrutiny Committee published its 19^th report on 15 March. It analyses the European Commission’s 2022 Work Programme and law-making priorities, EU proposals on the supply of medicines to Northern Ireland, and EU trade preferences for developing countries. The Committee has “significant concerns regarding the amount of EU legislation” - at least 29 EU legislative proposals this year - which could be applicable in Northern Ireland under the Protocol. It states, “This situation is untenable and is a stark illustration of the damage that the Protocol is having on democracy in the UK: as an avenue for the continued applicability of EU law in Northern Ireland that, unless repaired, replaced or removed, could develop into a motorway. All without the meaningful input—or final say on individual pieces of legislation—of the people of Northern Ireland. This cannot continue.” 

In the Commons on 14 March, a Statutory Instrument (SI) on Customs (Amendment) (EU Exit) Regulations 2022 was debated. The SI would replace “United Kingdom” with “Great Britain” in some customs-related legislation. Treasury Minister Lucy Frazer said, “the regulations do not in any way make it harder for traders to trade between Northern Ireland and the rest of the UK. In fact, they take away redundant provisions, tidy up the legislation and provide an easier and simpler route by way of the provision of a security.” Several MPs expressed consternation about the legislation. Steve Baker MP said, “In a statutory instrument that replaces “United Kingdom” with “Great Britain”, we find that he [the Prime Minister] appears to be doubling down on not fixing the Protocol.” DUP Sammy Wilson MP said that it “runs totally contrary to the assurances given by the Prime Minister that Northern Ireland would remain part of the UK customs territory; it runs contrary to article 4 of the Northern Ireland Protocol”. The SI was made under the affirmative procedure, it became law on 7 February when it was laid, and required House of Commons approval within 28 days. The SI has now lapsed. Sky News’ Sam Coates has more on the story.

Other news

• The Committee of the Regions (CoR) held the first UK meeting of its UK Contact Group, hosted by the Senedd on 17-18 March. Following the UK’s exit from the EU, the CoR launched a Contact Group between its members and UK organisations who were members before Brexit. Topics for discussion during the session included ‘Involving the subnational level in the Parliamentary Partnership Assembly’, and ‘Perspectives for cooperation and dialogue with UK regions’. More information can be found on the CoR’s blog.
• The Committee for the Executive Office on 16 March was briefed by the NI Assembly EU Affairs Manager on recent Brexit developments. MLAs had questions about the transfer of the Brexit portfolio to the Foreign and Commonwealth Office, Joint Committee meetings and the democratic voice of NI, scrutiny of Common Frameworks, supply of medicines to Northern Ireland, and new legislation from the EU which applies to Northern Ireland.
• On 15 March, the Minister for Health was asked about what contingencies his Department has in place to offset the loss of health funding provided by the European Social Fund. Minister Swann said, “For over three decades, the European Social Fund (ESF) programme, funded by the European Commission, has been a key source of funding for disadvantaged people.” He said the programme has been extended until March 2023 but beyond that arrangements remain unclear, including the role of the UK Shared Prosperity Fund: “Minimal information has been shared on the UK Shared Prosperity Fund being able to match the required funding and infrastructure models that were previously met. Although the levelling up White Paper was published in February 2022, it lacks any confirmation of the quantum of funding for here to replace that £80 million a year.”
• The Commons Public Accounts Committee has published a report on progress with trade negotiations. The Committee says, “There is no guarantee that the agreements will deliver actual economic benefits unless the Department provides vital support to help businesses use the agreements.” It states that the Department for International Trade should be clear about how the Government is making trade-offs across different policy areas, and highlights a lack of transparency and time for parliamentary scrutiny of international trade agreements.
• On 15 March, former Brexit Minister Lord Frost gave a lecture at the University of Zurich on ‘What is Seen and What is Not Seen: the UK, Europe, and beyond’.

This Week at the Assembly

• Tuesday 22 March, 2PM – Plenary - Question Time - Economy
• Tuesday 22 March, 12.45PM - Committee for Health - Briefing from Food Standards Agency - Food Compositional Standards and Labelling Common Frameworks
• Thursday 24 March, 12.40PM - Committee for Agriculture, Environment and Rural Affairs - EU Exit legislation - Written Briefing from DAERA; Common Frameworks - Clerk's Written Briefing

Catch up with Assembly Business

• Monday 14 March, 4.15PM – Plenary - Motion: Report on the Inquiry into Legislative Consent Motions
• Wednesday 16 March, 10.30AM - Committee for Agriculture, Environment and Rural Affairs - Organic Production Common Framework - Stakeholder Oral Evidence Session
• Wednesday 16 March, 10.30AM - Committee for Infrastructure – Road Haulage Association - Update on issues facing the freight/haulage sector
• Wednesday 16 March, 12.30AM - Committee for Economy- EU Exit legislation
• Wednesday 16 March, 2PM - Committee for The Executive Office - Oral Briefing from NI Assembly EU Affairs Manager