Greenhouse Gas Emissions Trading Scheme (Amendment) (Extension to Maritime Activities) Order 2026

Debate between Earl Russell and Lord Dodds of Duncairn

Thursday 12th March 2026 Lords Chamber

[Earl Russell (LD)]

It is not for me to respond to what is a question for the Minister. The Government’s impact assessment estimates central abatement investment of around £22 million, with administrative costs of £179 million over the period. The allowance-purchase cost is largely a transfer to the Exchequer and devolved Administrations, with many operators being non-UK based. Carbon pricing must therefore be matched with a credible transition plan. Without that, this becomes not a nudge for transition but could simply be a tax. However, the Government have announced £448 million for the UK Shipping Office for Reducing Emissions—UK SHORE—between 2026 and 2030, the largest public investment yet in commercial maritime.

Phase 2 will support larger projects through the Clean Maritime Demonstration competition and the Zero Emissions Vessels and Infrastructure competition. That is the industrial policy that must sit alongside carbon pricing. At the same time, the measure is expected, on the Government’s central estimate, to generate around £1.9 billion in allowance-sale revenue: around £95 million a year. Will the Minister confirm that a material share of ETS maritime revenues will be reinvested in maritime decarbonisation, including cleaner vessels, shore power, alternative fuels, and support for local transition in coastal and island communities, rather than simply disappearing? Will the Minister commit to publishing annually how much is raised from maritime ETS and how much is invested in maritime decarbonisation?

The cruise industry is an important and growing part of our economy, calling at some 50 UK ports and making over 2,500 calls a year, supporting tens of thousands of jobs and adding billions to the UK-wide economy. The industry’s concern on ETS is that revenues are not being visibly recycled into cleaner fuels and infrastructure specific to their industry. We only have a handful of onshore connections for cruise liners at the moment, so will the Minister tell us what investment will be made as a result of this scheme to bring shore power, and on what timetable for the cruise industry?

The Government and the UK ETS have done substantial preparatory work, including consultations, a digital monitoring platform and voluntary onboarding since November 2025, ahead of the July 2026 start. The Government’s impact assessment estimates an average administrative cost of around £5,700 per operator per year. This may be modest, but it has real implications for real firms. We recognise that this should reduce over time.

We welcome the formal review at the end of 2028 to assess emissions outcomes, administrative burdens and any needed adjustments to scope or thresholds. We have a number of specific concerns about any plans to expand the scope to international voyages. My noble friend will address the specific issues relating to Northern Ireland aspects. We believe the right approach is to keep these provisions under review and match carbon pricing with practical support, not to abandon maritime decarbonisation. Extending the UK ETS to domestic maritime emissions also helps keep our scheme aligned with greater integration with the EU. In turn, a genuinely linked system will help strengthen our trading relationship.

The fatal and regret Motions both reflect genuine anxieties about costs, competitiveness, and the union, but neither justifies rejecting this order. The suggestion that there is no alternative is not borne out by the evidence. Improved operating practices, routing efficiency and gradual fuel switching all represent viable abatement pathways.

Near-zero emission fuels remain expensive and infrastructure is incomplete. But that is exactly why revenue recycling and UK SHORE matter. The right course is to pair a robust carbon price with predictable investment that keeps the maritime sector on its net-zero path, while keeping the UK economy competitive. To call this measure simply a tax misunderstands how the ETS works. It is designed to minimise the cost of meeting our climate goals, to give business flexibility and to limit carbon leakage: this is a practical measure. It becomes a tax only if the Government pocket the proceeds and fail to reinvest them. Revenue is a byproduct: the purpose is to cap and reduce emissions over time. We are supportive of the extension of emissions trading to domestic maritime. Done well, emissions trading drives real reductions, supports innovation and underpins our net-zero transition.

[Lord Dodds of Duncairn (DUP)]

I am grateful to the Minister for introducing the statutory instrument in the way that he did, to the noble Baroness, Lady Hoey, for introducing her fatal Motion, and to the noble Lord, Lord Moynihan, for introducing the regret Motion. It is very important that we in this Chamber debate these issues: this matter got 47 minutes in the other place. Often, matters that affect Northern Irish consumers and businesses in a very direct and detrimental way do not get any time at all in the other place. It is therefore all the more important that your Lordships have the opportunity to debate these matters.

The noble Baroness, Lady Hoey, and the noble Lord, Lord Moynihan, have powerfully set out what happened in relation to the Northern Ireland Assembly’s consideration of this matter. This Government are supposed to be pro growth; they are supposed to have the cost of living at the heart of their consideration, and indeed they say that they are pro union and are committed to this through various command papers and policy statements. Thank goodness we are not debating the Windsor Framework edifice today, but it always needs to be taken into consideration, because it was certainly a matter for the Secretary of State when he was interacting with party leaders on this particular issue. This statutory instrument runs counter to all these priorities of the Government, yet they proceed with it nevertheless.

The noble Lord, Lord Moynihan, and the noble Baroness, Lady Hoey, referenced the intense lobbying on the part of His Majesty’s Government, at Secretary of State and ministerial level, to parties in Northern Ireland when it became clear that they were deeply concerned about the effects on Northern Ireland. The introduction of the CBAM argument led Ms Finnegan, the Sinn Féin MLA, to say just this week in the Assembly debate:

“While the challenges facing businesses as part of the changes remain, doing nothing is simply not an option. Failure to implement the ETS would result in the costs being incurred through the carbon border adjustment mechanism”.


That proves that this argument changed minds. This was the deciding argument for Sinn Féin. Interestingly enough, it was Sinn Féin, and the SDLP and the Alliance Party, who succumbed to the arguments of the UK Government. It was an interesting turn of events that those parties succumbed to that type of argument. But that is mainly to do with their total allegiance to anything that advances the cause of the EU, even above the interests of their own constituents, as has been evidenced in many debates in the Northern Ireland Assembly.

I also raise the fact that not only was the CBAM argument introduced at a very late stage but, in messages to party leaders, and certainly my party leader, the issue of the SPS agreement and the EU reset negotiations was also raised, and it was explicitly said that this would be put at risk if this SI was not passed by the Northern Ireland Assembly. These are very serious matters. Raising issues such as these as threats and blackmail, at the last minute and without any proper consideration, as the noble Lord, Lord Moynihan, pointed out in the other place, or indeed when the matter first came before the Northern Ireland Assembly, is totally unacceptable.

It is an outrage that these matters should be considered in this way, especially when we consider what is at stake for Northern Ireland, because this is a discriminatory measure. It is a measure that disproportionately affects Northern Ireland, as has been said. I am not going to repeat all the arguments that have been set out on the economic detriment to Northern Ireland—they have been powerfully set out already—but given our dependence upon maritime transport, it is absolutely clear that this is going to have a knock-on, detrimental effect on businesses, on consumers and on every aspect of life in Northern Ireland.

Tobacco and Vapes Bill

Debate between Earl Russell and Lord Dodds of Duncairn

Committee stage
Thursday 13th November 2025 Grand Committee

[Earl Russell (LD)]

My Lords, I shall speak to my Amendments 195 and 196 on reviews and compliance; I thank my noble friend Lady Walmsley for adding her name in support of them.

We support this Bill and its core intention of creating a smoke-free generation. More than that, we support the fact that this Bill is making progressive changes with the aim of having lasting impacts. However, it is often these very forward-thinking ideas that require further reviews and guidance because they are, by their very nature, new and different. It is surprising to me that the Bill as drafted does not contain any form of formal review mechanism. We think that a review mechanism is fundamentally necessary and useful, the intention being to support the aims of the Bill and not to detract from them in any way. It is in this spirit that I speak to my amendments.

Amendment 195 would require the Secretary of State to conduct and publish a review of the Tobacco and Vapes Act within six months of 1 July 2030, when those born on or after 1 January 2009 will have reached the age of 21. This review would evaluate how effective the Act has been, including whether the legislation has reduced the use of tobacco and nicotine in the first affected generation and whether it has achieved its intended objectives and public health outcomes. It would also examine any unintended effects, such as challenges with enforcement, widening health inequalities or any growth of illicit or unregulated markets. This early-stage review process would ensure that Parliament can assess the policy’s impact on young adults and make timely adjustments if any are required.

My Amendment 196 would mandate a further, more comprehensive review of the Act’s implementation when the same cohort reaches the age of 25, four years later, to be published within six months of 1 July 2034. This second review is designed to assess the longer-term success of the legislation, including changes in smoking and vaping prevalence; impact on public health outcomes; and the role of cessation programmes. It would also explore any emerging social or economic consequences, offering a deeper understanding of the Act’s sustained effectiveness. This later review would provide Parliament with a robust evidence base to determine whether further legislation or policy adjustment is needed.

Together, these two amendments seek to ensure that future Governments do what this Bill sets out to do: to protect the next generation from the harms of tobacco and nicotine, and to do so through measures grounded in evidence, transparency and sound policy-making. My amendments are designed to strengthen the Bill’s core purpose as it is advanced over time. They would help to ensure that the Bill’s stated outcomes are reviewed and assessed, and that any further amendments are considered. They would ensure that evidence is examined at each critical stage of implementation. They would ensure that, where adjustments may be needed—whether in enforcement, cessation support or tackling unintended consequences—Parliament would be properly informed and, therefore, able to act.

The age of 21 is the first major milestone when we can meaningfully assess the outcomes. It is of foremost importance that the impact of the legislation be considered in relation to rates of vaping in the UK. It is vital that unintended consequences be examined if they emerge, particularly in relation to rates of vaping. This later phrase is vital. Every public policy and piece of health legislation brings with it the possibility of unintended consequences and side-effects, whether they concern enforcement, equity or the rise of illegal markets.

I believe it is important that these matters be reviewed. It is also essential that the review be based on adequate data which is used to re-examine the policy and check that it is effective. If policies emerge, it is important that this legislation be reviewed. These amendments are about ensuring delivery and that the Bill, when it becomes an Act, does what it sets out to do. I want to see a feedback loop between policy ambition, lived experience and data. These questions of enforcement and of rising age restrictions are important, as is the issue of black markets, so the Government need to review this legislation to see that it does what is intended. My hope is very much that the Minister will at least agree to take the principles of regular, evidence-based reviews back to the department, because this is a genuine offer to try to make sure that the Bill is effective over time.

Turning briefly to the other amendments in this group, Amendment 189 in the names of the noble Lord, Lord Kamall, and the noble Earl, Lord Howe, is also about implementing a review of the Act. The review proposed in their amendment would come after five years and include laying a copy of that review before Parliament. In a different vein from my review, it would also include a review of the impact on small and micro-businesses. I am tempted to support their amendment, too. The central focus of the Bill is a smoke-free generation. That should not be at the expense of small businesses, but the most important element here is that we get a smoke-free generation, so I am minded to lend my personal support to Amendment 189.

Amendment 216, spoken to by the noble Lord, Lord Murray, again seeks to put forward a review. Where I part company on his amendment is its expiring nature. While we support reviews of the legislation, the review needs to happen and the consequences come afterwards. To put the expiry in the Bill sets up the possibility that a future Government of a different persuasion could use it as an opportunity to remove important elements of what will then be an Act, which we would not want to see happen.

I will leave it to the Minister to respond to the other amendments in this group on the Windsor Framework.

[Lord Dodds of Duncairn (DUP)]

My Lords, I support the amendment standing in the name of the noble Baroness, Lady Hoey, and of course Amendment 200, which stands in her name and my own. I look forward to the Minister’s response to this debate, because she is now expected to deliver not just political answers but legal judgments. I note that the noble and learned Lord, Lord Hermer, is not usually so reticent in making his opinions known, but he seems incredibly bashful when it comes to the Windsor Framework. He has of course been known to have an involvement in Northern Ireland affairs in the past, so I look forward to what the Minister has to say on that.

The legislation before us in the latest in a whole series of measures, both primary and secondary, which are affected by the Windsor Framework or protocol. “Windsor Framework” is of course just a new name for what is substantially the Northern Ireland protocol. A few minor amendments were made but it is substantially that protocol, as agreed by the previous Government with the European Union. Section 7A of the European Union (Withdrawal) Act 2018 is, as the noble Baroness, Lady Hoey, outlined, the conduit or means by which European law takes precedence over any UK legislation, primary or secondary, in over 300 areas covering vast swathes of the economy of Northern Ireland. Let that sink in: when we talk about Brexit and sovereignty, part of the United Kingdom is subject to European law in over 300 areas.

Just this past month, we have been debating various issues, including the supply of veterinary medicines to Northern Ireland, some of which may be discontinued because they do not conform to EU standards, causing major problems for animal health. The Government are showing no urgency in addressing this. The Select Committee on which I have the privilege to serve looked at this matter yesterday; I hope that we will get some action. We also looked at the issue of dental amalgam, and now we have this tobacco Bill. In all these issues affecting Northern Ireland, UK legislation is disapplied or cannot apply because of the Windsor Framework/Northern Ireland protocol.

Northern Ireland is bound in this area by the tobacco products directive—directive 2014/40/EU—because it is listed in annexe 2 of the protocol. That is where we get the figure of 300 areas of law. Of course, although we can debate all these issues, and Northern Ireland representatives, and others, in the House of Commons and in this place can give their views, at the end of the day the decisions are made by the European Commission. The European Union will decide what happens in part of the United Kingdom, regardless of the views of anyone elected in the UK Parliament or the Stormont Northern Ireland Assembly, of whatever party, or anyone in this House.

That should perturb us all. It is not just a unionist concern; it is a concern for any self-respecting elected politician of whatever party that they are not able to make laws for the people they represent. Ultimately, unless this matter is addressed overall, it will have grave ramifications after the 2027 Assembly elections.

Article 24 of directive 2014/40/EU states:

“Member States may not … prohibit or restrict the placing on the market of tobacco or related products”.


It seems to me that, on any reasonable reading of the Bill—as backed up by the former Northern Ireland Attorney-General, Mr Larkin, who has been referred to—it does indeed fall foul of the tobacco products directive.

The Government say that they intend it to apply across the four nations of the UK, that they are confident that this is the case and that we should all be assured by that. But they have given previous such assurances, as has been referred to. They told us in very clear terms that the Rwanda Bill, for instance, would apply throughout the United Kingdom and that there would be no loophole in Northern Ireland, but the Northern Ireland courts inevitably struck that down. They judged not only that it was in breach of the European Convention on Human Rights but that it was disapplied in Northern Ireland. It was not just a declaration of incompatibility but a disapplication of the law in Northern Ireland, because it fell foul of Article 2 of the protocol. The protocol reigns supreme. It is the same in other immigration cases and in the legacy legislation.

There should be no doubt about the importance and width that the Northern Ireland courts are giving to this legislation. It is very clear: the European Union (Withdrawal) Act makes it absolutely explicit. I ask the Minister to outline exactly what the basis is for the Government’s confidence and assurances—and not just to reassert that they are confident or assured that it complies. What is the basis for these assertions and what will they do if, ultimately, the courts strike the legislation down as far as Northern Ireland is concerned?

Will the Minister and the Government give a commitment today that, if, at the end of the day, the courts agree with the judgments or opinions that have been given by learned former Attorney-Generals, they will come back to this House and legislate to override the disapplication? Why do they not adopt the amendments suggested here in this place to reassure everybody that there can be no question or doubt about the legislation’s application across the four countries of the United Kingdom?

Why not remove any prospect of litigation or any disapplication in Northern Ireland? This would give some reassurance that the Government are serious about the matter. A few weeks ago in the House of Commons, Secretary of State Hilary Benn said in response to a question that it was Labour’s aspiration to impose the Bill in full in Northern Ireland. What is the position—aspiration, intention, expectation? What about a guarantee through adopting these amendments?