Road Vehicles (Type-Approval) (Amendment) Regulations 2025

Lord Dodds of Duncairn Excerpts

Tuesday 25th November 2025 Grand Committee

Moved by

[Lord Dodds of Duncairn]

That the Grand Committee takes note of the Road Vehicles (Type-Approval) (Amendment) Regulations 2025.

[Lord Dodds of Duncairn (DUP)]

My Lords, I will speak also to the Road Vehicles (Type-Approval) (Amendment) (No. 2) Regulations.

The stated purpose of these regulations is to bring Great Britain’s vehicle type approval regime into closer alignment with the European Union legislation—legislation which, of course, applies in Northern Ireland as a result of the protocol/Windsor Framework. That objective, I say in passing, inevitably raises serious and wider questions regarding implications of the Windsor Framework and the Government’s trajectory of regulatory convergence with the European Union, despite the UK having no role in shaping the rules with which it is expected to comply.

Ministers argue that such alignment is necessary to reduce friction within the United Kingdom’s internal market. However, the practical effect of these regulations is not to preserve that market but to formalise its division. They explicitly acknowledge and entrench the existence of two separate regulatory systems within our country—one applicable to Great Britain and another in Northern Ireland, which remains bound by the EU single market for goods. Indeed, paragraph 5.9 of the Explanatory Memorandum to the no. 2 regulations talks about the removal of barriers for vehicle manufacturers

“wishing to sell vehicles on both GB and EU/NI markets”.

Therefore, these regulations do not resolve the fundamental issue; they institutionalise it. They reinforce the reality of a United Kingdom operating under two distinct vehicle type approval regimes. This situation—that division of regulatory regimes—is causing real problems for car dealers and ordinary consumers and customers in Northern Ireland through additional costs, reduced availability of vehicles, and burdensome administrative complexity. It is a position that, in my view, is wholly unsustainable for the United Kingdom.

I put it to the Government that in reinforcing the division of the UK into two separate and distinct vehicle type approval schemes, they must realise that they are acting in contradiction of Section 46 of the United Kingdom Internal Market Act 2020, which says that Ministers must have special regard to Northern Ireland’s place within the United Kingdom and to the need to

“facilitate the free flow of goods between Great Britain and Northern Ireland”.

Whatever else these regulations do, they do nothing to meet those criteria and to restore Northern Ireland’s place within the UK internal market. Until the Government address the underlying structural issue of dual regulatory regimes, businesses and consumers will continue to bear the costs of a flawed system.

I come to the real and practical problems that consumers and businesses now face in Northern Ireland as a result of the dual regulatory regime, even after these regulations come into force. In the first 10 months of this year alone, the car market in Northern Ireland is down by 6%, and in the rest of the United Kingdom it has increased by 5%. That represents a reduction in turnover of approximately £50 million. Matters are expected to deteriorate significantly as we approach next year, when full implementation of the GB type approval scheme is due to come into force.

We have seen some very stark consequences already. The best-selling car in Northern Ireland, the Vauxhall Corsa, cannot be sold in Northern Ireland as things stand; it can be sold in the rest of the United Kingdom, but it cannot be sold in Northern Ireland. Renault, Citroën, Peugeot, Fiat, Jeep, Alfa Romeo, Vauxhall, Nissan and Jaguar Land Rover are not dual-approved. BMW is making dual-approved cars, but they are still Great Britain-designated when leaving the factory. This industry in Northern Ireland supports 17,600 employees. If we keep on the present course, job losses will be an unavoidable reality, consumer choice will continue to be greatly restricted and the costs for consumers—including hard-working families in Northern Ireland—will rise sharply.

This is not theoretical; it is already happening. The National Franchised Dealers Association of Northern Ireland has given oral and written evidence to the Northern Ireland Assembly’s Committee for the Economy on a number of occasions, most recently just last week. Its message, as it stated to Members of the Assembly—who, by the way, unanimously agreed across all parties that this was a serious and important issue that needed to be addressed—was one of profound frustration. It expressed exasperation at the degree to which the free flow of vehicles within the United Kingdom is being obstructed. It said in its evidence last week that there has been little meaningful progress in identifying a workable solution; that sentiment is shared in the Northern Ireland Assembly and by elected representatives in Northern Ireland.

The Government have given assurances, but action to remove the fundamental problem has been lacking. Businesses and customers cannot operate on the basis of promises that something may be done at some unspecified point in the future. Action is needed now or at the start of next year; otherwise, we are going to face immense problems. It is simply not logical or defensible that Northern Ireland should be excluded from the UK-wide car market, which accounts for 2 million units per year; the Northern Ireland market accounts for 45,000 units a year. We are old that this system exists to protect the EU single market, yet the reality, according to the evidence given to the Assembly, is that, in the first 10 months of this year, only six vehicles moved into the Irish Republic. That is the scale of the so-called risk.

This system is doing so much damage to consumers in Northern Ireland, whom it is designed to protect. It is destroying the UK internal market and, with it, reducing competitiveness, undermining consumer choice and placing livelihoods in jeopardy. Consumers will increasingly and inevitably turn to Great Britain, where there will be greater choice and lower prices, to purchase vehicles. Manufacturer incentives and deals that are available on the mainland are not, and will not be, accessible in Northern Ireland, exacerbating the trend. Why should citizens in Northern Ireland be disadvantaged in this way? Sales at Vauxhall, one of the leading manufacturers in terms of market share, are up by 16% in Britain and down by 59% in Northern Ireland. That is not market fluctuation; that is structural failure.

With all of this, I fear that Northern Ireland is becoming increasingly marginalised. Our consumers are viewed as less valuable and attractive and are increasingly inaccessible within the manufacturers’ supply strategies. Car dealers and franchises in Northern Ireland will no longer have access to the UK unsold stock pipeline, as vehicles will be produced primarily to GB standards. This will fundamentally change the ability of local dealers to source and supply vehicles competitively.

Market distortion is inevitable. Great Britain-based dealers will pre-register vehicles and actively market them into Northern Ireland, or consumers will simply travel to England, Scotland or Wales to access better value and wider choice. That is not a functioning internal market, which is the Government’s obligation to uphold under the internal market Act.

It will also become increasingly difficult for dealers to sell new electric vehicles, particularly as compliance requirements tighten. Dealers will be forced to stockpile EU-compliant vehicles to maintain availability, creating significant additional cost burdens. Meanwhile, consumers in Northern Ireland will be excluded from the very consumer offers targeted at clearing unsold pipeline stock across Great Britain.

The EU, and thus Northern Ireland, is due to adopt new emissions standards in the coming years in respect of plug-in hybrids, as well as applying the new general safety regulation phases 2 and 3. This will drive divergence between Great Britain and Northern Ireland new car markets even more. They will also increase benefits-in-kind taxation costs in Northern Ireland. These costs are based on different utility factor categorisations allocated by the EU to Northern Ireland and by the UK Government to Great Britain. This is expected to work out to some £4,000 extra for a Northern Ireland consumer of a new car compared to the rest of the United Kingdom.

The NFDA asked last week: why is it acceptable, under the Windsor Framework, for consumers in Northern Ireland to have less choice and yet pay higher taxes than the rest of the United Kingdom? The Government have spoken about future equalisation measures, and I have no doubt we will hear that again today. However, that provides little comfort for customers standing in showrooms today, or after the Christmas holidays and in the new year, or for dealers, who face the immediate prospect of the problems that these measures create.

The Government say that there is no technical impediment to manufacturers dealing with dual-type approval. They say that it is legal for them to do it, but permitting something and making it legal is very different from the actual practice of businesses, which of course want to operate within the law, but they operate on the basis of what makes sense commercially. Manufacturers are not taking guidance from government officials; they are, naturally and inevitably, pursuing separate type approvals wherever it gives them commercial advantage—that is what is happening. As I said, sometimes cars are made dual approved, but on leaving the factory, they are designated as either EU or GB type approval. The reason given by manufacturers for pursuing single-type approvals is that they are restructuring their internal engineering processes and systems on the assumption of progressive divergence between EU and GB standards over time. That is the commercial reality they are preparing for. Even those manufacturers who have opted for dual-type approval do so only as an interim measure, expecting future divergence and prepared to adapt their approvals accordingly. They will move away from EU standards if they believe there is a commercial benefit in doing so.

As I said, the Government will say that we need not worry about all this because we will converge with the EU and adopt its standards. However, that is not sufficient to meet the here and now; it is not sufficient to meet will happen in the next six months to a year. In reality—according to the evidence given to the Northern Ireland Assembly Committee for the Economy—we are not going to have 100% convergence in any case, so manufacturers will always say that they are going to build according to the GB regulations; it is a far bigger and more profitable market compared with doing something to accommodate the 45,000 sales in Northern Ireland. Some manufacturers have indicated that they will exit the Northern Ireland market entirely, as the volume simply does not justify the cost and complexity of operating under these incredibly complex conditions.

We are going to have restricted consumer choice, increased prices compared with the rest of the UK, higher benefits-in-kind taxation, differing vehicle specifications, customer confusion, reduced stock availability and prolonged delivery times. The Government must now acknowledge that this is unsustainable. It is not protecting trade but suppressing it. It is not safeguarding jobs but placing them at risk, and it is eroding Northern Ireland’s place within the UK internal market.

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[Lord Hendy of Richmond Hill (Lab)]

I thank my noble friend for that. I think her proposed remedy is the right one, which is to meet people who know what they are talking about and listen to them. If that is part of the solution here, I am sure that we should do that.

[Lord Dodds of Duncairn (DUP)]

I am grateful to all noble Lords who have contributed to this debate. I think we are all agreed that this is a very serious issue, as the noble Lord, Lord Murphy, said, for people in Northern Ireland. The noble Baroness, Lady Suttie, mentioned constitutional issues. I have sought in this debate to emphasise the practical problems, which are the outworking of some of these wider issues on the constitutional front that in my view are totally unnecessary, but we have to find solutions. I am therefore grateful to the Minister for his reply to this debate and for the tone and content of what he has said, in that he is going to take this away, take it seriously and talk to colleagues and those who matter to try to find solutions. That is what we would love to see happening. Up to now, I do not think there has been enough urgency, if I may say so, as the deadline has crept up and up. I am grateful to the Minister for his commitment. Knowing him and the way in which he operates, I know he will hold fast to that, and that will, I hope, deliver results.

Disruption at Heathrow

Lord Dodds of Duncairn Excerpts

Tuesday 25th March 2025 Lords Chamber

[Lord Hendy of Richmond Hill (Lab)]

Provided that a suitable proposition comes forward for the expansion of Heathrow, it is inevitable that all the things that the noble Baroness mentions will have to be considered in the round in that. I am sure that she also includes surface access to the airport and a good passenger experience. She will know that we await a proposition from Heathrow and/or any other interested parties in the expansion of Heathrow, but I have no doubt that, when that is received, consideration will be given to all the things that she talked about.

[Lord Dodds of Duncairn (DUP)]

My Lords, obviously, the impact of the closure of Heathrow is massive and has reputational and other consequences for this country. But travellers and business depend so much on other airports throughout the United Kingdom—such as Belfast, which has been mentioned, given the lack of alternatives, for obvious reasons. Does the Minister know what work is going on at present in airports in Northern Ireland, and throughout the United Kingdom, to examine resilience and the threats to those airports?

[Lord Hendy of Richmond Hill (Lab)]

The noble Lord may know that I am tolerably familiar with the essential nature of flights from Northern Ireland to mainland England, Wales and Scotland because of the Union Connectivity Review. In particular, I had to answer a question quite recently about the reliability of the first flight on Monday mornings, which clearly contains quite a large proportion of Members of both Houses. I repeat that I strongly recommend to the operator that, come what may, it operates that flight if it operates nothing else. I do not know currently what is going on in other airports in Britain to look at resilience, but I have no doubt that the outcome of the Kelly review and the—I will make sure I get the right initials—NESO review will be closely studied by all those airports because that is undoubtedly the case. Noble Lords can be reassured that the transport community as a whole takes a close interest in what happens in one place.

Incidentally, I have seen—noble Lords might have expected me to—a review that Network Rail started on Saturday morning about the resilience of its power supplies, because in these circumstances you would start those sorts of reviews before you knew even what the cause was. That is a perfectly rational thing to do. So I have little doubt that that is going on in respect of other UK airports currently; I do not know that it is, but whether or not it is, I have absolutely no doubt that they will study very closely the results of the Kelly review and the NESO review—I would rather not use the initials, but it is too easy to do—to make sure that they are all as resilient as they can be.