Brexit & Beyond newsletter
24 April 2023
Welcome to the 24 April 2023 Brexit & Beyond newsletter
The Lords Sub-Committee on the Protocol on Ireland/Northern Ireland has been hearing from businesses about concerns and challenges around the Windsor Framework. The UK’s potential association to Horizon Europe was debated in the House of Commons. Political leaders have made remarks about the Windsor Framework at QUB’s event to mark the 25th anniversary of the Belfast/Good Friday Agreement.
The Windsor Framework: views from business
On Wednesday, the Lords Protocol on Ireland/Northern Ireland Sub-Committee heard evidence from representatives from NI business, and the haulage and farming sectors on the Windsor Framework. Stuart Anderson from the Northern Ireland Chamber of Commerce and Industry said the Windsor Framework achieves their “top ask” – a joint solution, and stability between the EU and UK markets which is “critical for business and trade”. Anderson went on to say that operational detail on the Framework is lacking, particularly regarding customs and the operation of the red and green lane. Mark Tait, Director of Target Transport, echoed this concern, saying that there isn’t enough information about how the Framework will operate, adding that there are disparities between the EU and UK publications on the agreement. He suggested it could make life more difficult for the haulage sector. David Brown, President of the Ulster Farmers' Union (UFU), emphasised that they need the new processes to be “tried and tested”. He highlighted some outstanding concerns: some varieties of plants are still prohibited for NI, and there are issues around livestock movements. He added, “Generally speaking, it’s the things we don’t know, or haven’t seen the detail of, that probably will raise the concerns.”
Stuart Anderson, Head of Public Affairs at the Northern Ireland Chamber of Commerce and Industry | Source: UK Parliament
The red and green lanes, and ‘at risk’ test, were discussed. Goods which are considered at risk of moving into the EU single market must move through the red lane with more checks and controls. Anderson pointed out that there are uncertainties about the ‘at risk’ test, and firms which are caught by these requirements and not selling much to the Republic of Ireland, struggle to see the benefits of the Framework, aside from it giving a stable solution. Tait highlighted his concerns about haulage which classed as at risk, even if the products are mostly staying in NI. He said the red and green lane concept is “very binary…as far as haulage is concerned, there is no green lane…[only] a highly regulated express retail lane” He highlighted that for small businesses, it would be highly costly to comply with full EU customs declarations.
A solution on veterinary medicines was not included in the Windsor Framework. A grace period until December 2025 was put in place in December 2022 (the new arrangements were set to enter into force at the end of that month). Brown emphasised that there must be “sincere engagement to ensure we do not run up against cliff edges in three years”. The UFU has argued for an EU-UK SPS agreement, which they say would resolve many issues for the sector. Asked about why dealing with this issue may have been deferred, Brown suggested that perhaps the EU thinks an SPS agreement is potentially something to come in the future.
Anderson said it is disappointing that it took three years to get to this stage and remarked that some areas will remain quite difficult. He concluded that if the EU-UK relationship has improved, it’s important that everyone is “really honest…about where the opportunities and where the challenges lie”.
Other issues discussed at the session were VAT, excise duties, state aid, parcels, regulatory divergence, NI’s access to EU trade deals, and NI’s representation in Brussels. Next week, the committee will hear evidence from Peter Summerton (Managing Director at McCulla Ireland), Roger Pollen (Head of FSB Northern Ireland at Federation of Small Businesses) and Sarah Hards (Sales Director at AM Logistics).
The Sub-Committee has published a response from the Minister for Europe Leo Docherty on regulatory divergence. He states that the Government will issue new guidance to appropriate authorities “to emphasise the need for ongoing vigilance, proper analysis of the impacts of their activities, and proactive steps to avoid new barriers to Great Britain-Northern Ireland trade and protect unfettered access to the whole UK market for Northern Ireland’s firms.”
UK’s potential association to Horizon Europe
On 18 April, a Westminster Hall debate took place on research and development funding and Horizon Europe. Formalisation of the UK’s association to Horizon Europe, the EU’s research and innovation funding programme, was stalled by the EU because of the dispute over the Protocol on Ireland/Northern Ireland. Paul Blomfield (Labour) said Horizon “is the single largest collaborative research programme in the world…alternatives to [it] are not available.” He argued, “The economic benefit of Horizon is huge but…there are even more compelling reasons for association with it. Horizon Europe offers unrivalled access to a ready-made collaborative funding scheme, making it easier to work across multiple countries”. Blomfield pointed out the €7 billion in research funding the UK received between 2014-2020, and said 31,000 collaborative links were established with countries around the world.
Minister in the Department of Science Paul Scully stated that the Government is “fully committed” to science and research collaboration. He added, “Association needs to be on the basis of a good deal for the UK’s researchers, businesses and taxpayers.” He said discussions with the EU “need to reflect the lasting impact of two years of delay to the UK’s association, which means, as we have heard, researchers and businesses across the UK have missed out on over two years of a seven-year programme.” He said the UK’s alternative scheme, Pioneer would receive “at least the same amount of funding as the UK would have paid to associate to Horizon” from 2021-27.
The Prime Minister has written to the Commons Science and Technology Committee stating the Government’s preference is to secure the UK’s association to Horizon Europe, but that this would need to be “on fair and appropriate terms”.
Queen’s University hosts ‘Agreement 25’ conference
Last week, Queen’s University held a three-day conference to mark the 25th anniversary of the Belfast/Good Friday Agreement. Various politicians made remarks about the Windsor Framework during a series of speeches and panel discussions, which can be watched back. President of the European Council Charles Michel said the Framework “provides a good opportunity to build a more positive and stable relationship between the EU and the UK.” He added, “I think it will provide greater certainty and predictability for the people and businesses in Northern Ireland.” President of the European Commission Ursula von der Leyen declared that the Windsor Framework is “a new beginning for old friends. It turns the page on years of division and dispute. It is an opportunity to set our sights on the future of our partnership and to focus on what brings us together.”
Former US President Bill Clinton told the conference, "This Windsor Agreement seems to me, as an outsider who cares very much, as the best way to split the baby. To allow the benefits of access to the EU single market and access to the UK market. The best of both worlds. I don't think there is anything quite like this.” He added that he hoped “it is enough and that it'll be tweaked a bit”, emphasising, “No matter how good any deal is, what really matters is how long it has a hold on people's imagination and trust."
Akshata Murty, Rishi Sunak, Ian Greer, William J Clinton, Hillary Rodham Clinton, and Leo Varadkar attending the Agreement 25 conference at Queen's University Belfast | Source: Simon Walker / No 10 Downing Street
Taoiseach Leo Varadkar said he hopes the Framework will “play an essential role in securing additional investment into Northern Ireland, as well as offering real economic benefits to communities across Northern Ireland.” Prime Minister Rishi Sunak stated, “The Windsor Framework is a breakthrough moment. It solves practical problems and, crucially, strengthens Northern Ireland’s place in our Union and our UK internal market. It gives the Assembly significant new powers – ready for when it sits again. And I am confident we can build broad support for it across all communities.”
Other news
- Today (24 April) at 4.30pm, a Westminster Hall debate will be held on the impact of the UK's exit from the European Union.
- The Commons European Scrutiny Committee has written to Minister Badenoch enquiring about the delay in the passage of the Retained EU Law Bill. Report stage and third reading of the Bill in the Lords had been scheduled for last week and this week.
- The European Parliament voted to adopt the reform of the EU Emissions Trading System, and the new EU Carbon Border Adjustment Mechanism (CBAM). The Parliament also voted to adopt a law on products associated with deforestation. These texts must now be formally adopted by the EU Council. The Lords Sub-Committee on the Protocol has been corresponding with the Government on the deforestation regulation, which may apply in Northern Ireland under the Protocol. In February 2023, the Minister for Biosecurity, Marine and Rural Affairs stated that the Government is “still in the process of conducting a full assessment which will allow us to determine whether the Regulation should automatically apply to Northern Ireland under Article 13(3) of the Protocol.” Under the new mechanism in the Windsor Framework, the Stormont Brake (which will only be able to be used when the Assembly and Executive are functioning), allows 30 MLAs from at least two parties to ask the UK Government to stop the application of changed or amended EU law (such as this), subject to certain conditions.
- The Government has circulated guidance to departments to ensure compliance with Article 2 of the Protocol on Ireland/Northern Ireland has been considered when making legislation. In Article 2 of the Protocol, the UK Government committed to ensuring that there would be “no diminution of rights, safeguards or equality of opportunity” (as set out in the Good Friday Agreement) as a result of the UK leaving the EU.
- While Scotland is no longer required to follow EU law, the Scottish Government made a commitment to ‘keeping pace’ with EU regulatory changes. The Scottish Parliament has commissioned new research tracking EU law to help parliamentary committees scrutinise this commitment. Convener of the Constitution, Europe, External Affairs and Culture Committee, Clare Adamson said, “This research will not only benefit the Parliament. It will also help businesses and stakeholders to maintain awareness of the legislative framework. Something which is vital for them if they wish to access the European market.”
- The UK’s fifth largest supermarket chain Morrisons (which doesn’t trade in NI) is setting up an egg supply chain in Northern Ireland. The BBC’s John Campbell notes this “could be a hedge for when GB finally starts implementing a post-Brexit SPS border”, which will make importing agrifood from the EU, including the Republic of Ireland, more complex and costly. The UK Government published its draft Border Operating Model earlier this month.