Brexit & Beyond Newsletter

31 October 2022

Welcome to the 31 October 2022 Brexit & Beyond newsletter

The NI Assembly was recalled last Thursday in an attempt to elect a Speaker. The deadline for forming an Executive has now passed. The Secretary of State for Northern Ireland, who previously stated he will be calling an election, has said he will soon set out the next steps. Queen’s University has published its latest opinion poll on the Protocol on Ireland/Northern Ireland. The Northern Ireland Protocol Bill is undergoing detailed scrutiny in the House of Lords. The Retained EU Law Bill passed its second reading in the House of Commons.

NI Assembly recalled

The Northern Ireland Assembly was recalled on Thursday 27 October, ahead of the 28 October deadline for restoring an Executive. The first item of business was to elect a Speaker. Neither nomination received cross community consent and therefore no further business could take place. The Secretary of State for Northern Ireland Chris Heaton-Harris made a statement on Friday. He reiterated that he was legally obliged to call an election, but did not set a date and said he would set out a plan of action soon.

MLAs made remarks in the chamber ahead of voting for a Speaker. Michelle O’Neill (Sinn Féin) said, “This Assembly and Executive have no mandate nor any role in those [EU-UK] negotiations. So, to hold back power-sharing and to hold down the public in the meantime is futile, reckless, short-sighted and senseless.” Paul Givan (DUP) said, “The barrier to devolution is not the DUP; it is the Northern Ireland Protocol. When that is addressed, we will be ready to form a new Executive. That is our position now, and it will be after the election.” Mr Givan contended that the Protocol is “the biggest driver of the cost-of-living crisis in a Northern Ireland context.”

The meeting of the Northern Ireland Assembly on 27 October | Source: NI Assembly

Nick Mathison (Alliance) said, “The only outcome that will resolve any of the issues with the Protocol will arise from negotiations between the UK Government and the EU. We need to get on with our jobs. We are not here to renegotiate international treaties. We are here to govern the people of Northern Ireland and to provide leadership, and we need to get on with that job.” Doug Beattie (UUP) said that fixing the problems with the Protocol “should not be done to the detriment of stable government. They can be done at the same time.” Matthew O’Toole (SDLP) commented that while the Assembly does not have much influence on EU-UK relations and the Protocol, “If we were sitting in an Assembly and there was a functioning Executive, we might, at least, be able to try to find a common voice on what we want from our post-Brexit arrangements.” Jim Allister (TUV) argued that EU-UK talks on the Protocol “cannot deliver a solution, because they are circumscribed by the mandate that the EU has given them. That mandate is only to tinker; it is only to make the Protocol work better — whatever that means.” Gerry Carroll (PBP) said, “The party that initially backed the protocol is now telling people that the North should not be treated differently from the rest of the UK.” Claire Sugden (Independent) said she was prepared to see the opportunities of the Protocol but as it stands, cannot support it. She added, “It disappoints me that this has become a unionist-and-nationalist issue. I assure you that my issues with the Protocol are not constitutional; they are trade issues and issues that affect my constituents.”

EU-UK relationship and Protocol talks

The new Prime Minister Rishi Sunak spoke to European Commission President Ursula von der Leyen on Wednesday 26 October. According to a statement from the Prime Minister’s Office, “the Prime Minister restated his preference for exploring a negotiated solution to the current issues” around the Protocol on Ireland/Northern Ireland. President von der Leyen tweeted that she looked forward to “finding joint solutions under the Protocol on IE/NI that will provide stability and predictability.” Foreign Minister James Cleverly and European Commission Vice-President Maroš Šefčovič held a call on Thursday 27 October. They agreed that EU and UK teams will continue talks on the Protocol. Tony Connelly reports from Brussels on the EU view on the new UK PM and his approach to the Protocol, writing “EU diplomats are trying to ascertain whether Mr Sunak’s Brexit enthusiasm will be eclipsed by pragmatism.” There has been some progress in the technical talks on VAT issues and steel tariffs, but the EU and UK are still far apart on other matters.

Poll on the Protocol

Queen’s University has published its latest opinion poll on the Protocol on Ireland/Northern Ireland. It finds that views on the Protocol remain deeply divided: 53% view the Protocol as “on balance a good thing for NI”, 39% disagree with this statement. 8% didn’t express an opinion. The poll was carried out between 7-10 October. The full report can be read on QUB’s Post-Brexit Governance NI project webpage.

Overall assessment of the current impact of the Protocol | Source: Queen’s University Belfast

The report highlights that the most negative views regarding the impact of the Protocol are in relation to its political implications, whilst the most positive relate to its economic consequences. 63% think the Protocol offers unique opportunities that could benefit Northern Ireland and 62% think it is having a negative impact on political stability in Northern Ireland. 71% of respondents would prefer to see a negotiated settlement between the UK and the EU (as opposed to unilateral action). 46% are currently optimistic that the UK and the EU can agree an acceptable resolution; 34% are not. Regarding the democratic consent vote, set to take place before the end of 2024, half of respondents currently favour MLAs voting for the continued application of the Protocol; 41% want MLAs to vote against it.

Northern Ireland Protocol Bill

The House of Lords began detailed scrutiny of the Northern Ireland Protocol Bill at committee stage on Tuesday 25 October. The Bill would disapply core parts of the Protocol relating to trade in goods, subsidy control, the role of the Court of Justice of the EU, plus allow changes to VAT. Various amendments were put forward, including to set conditions on the ministers’ powers created in the Bill, and to require the consent of the NI Assembly. Shadow Cabinet Office Minister Baroness Chapman put forward an amendment calling for the Government to provide an impact assessment of the Bill, draft regulations which may be laid under the Bill, and a report to Parliament on the status of negotiations with the EU, before the Bill proceeds to report stage. Further sessions of committee stage are scheduled today (31 October), and on 2 November and 7 November.

Retained EU Law Bill

The Retained EU Law (Revocation and Reform) Bill had its second reading in the Commons on 25 October. Jacob Rees-Mogg, who brought the Bill forward, resigned from Government last week. The new Secretary for Business, Energy and Industrial Strategy is Grant Shapps. The Financial Times has reported that the ‘Brexit delivery unit’ promised by Rishi Sunak in August will not be created, and that “Sunak is also said by government officials to be considering whether to press ahead with a 2023 ‘sunset clause’ for EU regulation.”

During the debate, Business Minister Dean Russell said he accepted that some retained EU law in the scope of the sunset “is required to continue to operate our international obligations, including the trade and co-operation agreement, the withdrawal agreement and the Northern Ireland protocol…the Government will, as a priority, take the necessary action to safeguard the substance of any retained EU law and legal effects required to operate international obligations within domestic law. We will set out where retained EU law is required to maintain international obligations through the dashboard, so that the public can scrutinise it.” Sammy Wilson (DUP) said, “Some of this cannot apply to Northern Ireland, where EU law past and future will still apply. If anything, the Bill could drive a greater wedge between Northern Ireland, constitutionally, and the rest of the United Kingdom.”

Stephen Farry speaking during the debate | Source: UK Parliament

Claire Hanna (SDLP) pointed out that the absence of the NI Assembly means there is “no opportunity for Northern Ireland’s elected representatives to try to design replacement legislation.” She said there isn’t sufficient information about precisely which legislation applies to NI, and emphasised the implications for divergence within the UK. Stephen Farry (Alliance) called the Bill a “major threat” to the devolved settlements. He said, “Although we may have some protection in Northern Ireland through the Protocol, we will potentially see as many as 500 pieces of regulation upended…Civil servants will have precious little time to put this in place, which will potentially leave consumers, businesses and workers in Northern Ireland in an extremely vulnerable situation.”

Ahead of the debate, the Hansard Society published an analysis of five areas of particular concern in the Retained EU Law Bill.

The Human Rights Consortium, an alliance of civil society organisations across Northern Ireland, has published a briefing on the Bill. It says the Government has failed to analyse which areas of Retained EU Law impact on the commitments made in Article 2 of the Protocol, or on the level playing field provisions of the Trade and Cooperation Agreement.

Next, the Bill will be undergo detailed scrutiny by the Public Bill Committee, which is now accepting written evidence.

View from NI Ministers

In response to a written question on Retained EU Law and environmental protection, the NI Minister of Agriculture, Environment and Rural Affairs said his officials are considering the potential impact of the Bill and that, “It is my intention going forward that Northern Ireland continues to have a clear statutory basis for protecting the environment and human health as has been the case throughout the changes resulting from the UK’s withdrawal from the EU.” MLAs have been able to continue to submit written questions to ministers while they were in place until 28 October. You can view written questions and answers on the NI Assembly website, including on replacement EU funding and supply of veterinary medicines under the Protocol.

EU-UK divergence

The Commons European Scrutiny Committee heard evidence on regulating after Brexit on 26 October. Joël Reland, Research Associate at the UK in a Changing Europe, said the Protocol is already “a significant constraint on the UK to regulate as a single nation”: some regulations cannot apply to Northern Ireland because of the Protocol e.g. alcohol duty reform. He added that businesses in
Northern Ireland could be at a competitive disadvantage if the EU regulations they have to follow are more strenuous than in GB. Reland said the UK Government could do a better job of tracking regulations on EU side and how they could impact the regulatory border between NI and GB: “there may be more work for Government to do in systematising those processes so that they see them coming beforehand and can either adapt regulations or prepare Northern Irish and British business for those changes as they are coming.”

Regarding the dual regulatory regime proposed by the UK Government (whereby NI companies could choose to comply with either the EU’s or the UK’s regulatory regime for goods), Barney Reynolds, Head of Financial Institutions at Shearman & Sterling, questioned who would check compliance with EU law, saying, “It seems a stretch to imagine that the EU will accept that working in any way where the UK is the sole arbiter of whether the EU’s standards are complied with.”

Other news

• The Interparliamentary Forum met in Cardiff on 28 October. The primary purposes of the Interparliamentary Forum are to provide a mechanism for dialogue and cooperation between parliamentarians from the Parliaments and Assemblies in meeting common scrutiny challenges arising from the new constitutional arrangements following the UK’s departure from the EU, and to co-operate in finding solutions to overcome them. The Forum met for a second time in the Senedd. Representatives of committees in Senedd Cymru, the Scottish Parliament, the House of Commons and the House of Lords were welcomed to the Senedd by the Llywydd, the Rt Hon Elin Jones MS. Discussions focused on the implications of important UK Bills on the Northern Ireland Protocol and Retained EU Law. A joint statement was published following the meeting.
• The British-Irish Parliament Assembly (BIPA) met on 25 and 26 October in Cavan. BIPA was set up in February 1990 as a link between the Oireachtas and the UK Parliament. Taoiseach Michéal Martin and UK Minister of State for Northern Ireland Steve Baker addressed the Assembly. The BIPA Economic Affairs Committee has published a report on the effects of the post-Brexit trading environment on UK-Irish trade.
• The Commons Business, Energy and Industrial Strategy has published a report on state aid and post-Brexit competition policy.