Trade Diversion and Windsor Framework

Sammy Wilson Excerpts

Tuesday 4th March 2025 Commons Chamber

[Jim Allister]

In a moment, perhaps. I need to make sure I get through what I need to say.

It is beyond doubt, I would respectfully say, that there has been trade diversion. Back in September, the Road Haulage Association gave evidence to a parliamentary Committee of this House. It told the Committee that 30% of haulage lorries that take goods to GB are returning empty. Why? Because GB companies have stopped supplying. Now, that is an incredible thing to contemplate. Trade works on the basis that you take goods out, and then you fill your lorry and bring goods back. That is how you make it viable and how the economy works. That 30% of lorries now returning to Northern Ireland are returning empty is an incredible indictment of the operation of the protocol.

And things are getting worse. The EU regulation on general product safety now puts more burdens on companies selling into Northern Ireland, because they have to meet enhanced EU product safety regulations. I have mentioned the craft sector in this House before. Recently, 11 suppliers in that niche market stopped supplying Northern Ireland. It will get worse, because the partial border is coming and they will have to do more paperwork and make more declarations about sending simple parcels from GB to Northern Ireland. Tesco has slides that it shows to its own suppliers stating that they should now buy from the Republic of Ireland because it is easier to supply from there than from GB. The same is happening in veterinary medicines and in every sector.

Why does that matter? It matters for a very pertinent political reason. The whole idea of trade diversion and the whole purpose of the protocol was and is to build an all-Ireland economy: to dismantle the economic links between Great Britain and Northern Ireland and enhance links with the Irish Republic, thereby creating stepping stones out of the United Kingdom into an all-Ireland for Northern Ireland. That was the determination that lay behind the protocol.

We do not need a protocol to govern trade. It is demonstrable that if we can organise trade through Northern Ireland to GB without border checks in the Irish sea, and if, as the Government now say is possible, we can do it with checks away from the border, then equally we could do it in the other direction, through mutual enforcement. That would mean recognising that if we are going to export from one territory to another, our manufacturers must produce goods to the standards of the other, and we would enforce that by making it a criminal offence to do otherwise. That is the essence of mutual enforcement. It would work, but it is not allowed to work, because the political agenda of the protocol is to ensure this reorientation and realignment.

We are told that we now have Intertrade UK, but it has no staff and no budget, in comparison with InterTradeIreland, which has more than 50 staff and a budget of £6.5 million a year and is active across the whole area. Intertrade UK has been set up as a shadow, but it is not able to compete in any sense.

This Government have allowed the economy of Northern Ireland to drift out of the United Kingdom. I believe those who are protocol enthusiasts want that to happen. Now it is happening, the onus is back on the Government to do something about it.

[Sammy Wilson (East Antrim) (DUP)]

rose—

[Madam Deputy Speaker (Ms Nusrat Ghani)]

Before the hon. and learned Gentleman takes the intervention, I know that he was anxious about getting through his speech, but, because the Adjournment debate started early, he does have until 7.30 pm. [Laughter.] I believe he was about to take an intervention—does he want to continue with that?

[Jim Allister]

I will give way.

[Sammy Wilson]

You shouldn’t encourage him, Madam Deputy Speaker—he will take to 7.30 pm and beyond, because this is such an important subject.

Does the hon. and learned Gentleman agree that the diversion of trade has not only political but economic implications for Northern Ireland? There are increased transport costs, because lorries do not come both ways with goods in them; there is the fact that many people chose suppliers in England because they are cheaper, better-quality and so on, and now manufacturers in Northern Ireland are having to go to the second-best suppliers; and there is also the additional paperwork that is involved. That all adds to costs and makes the Northern Ireland economy less competitive, which therefore makes it more difficult for it to be viable.

--- Later in debate ---

[Jim Allister]

I agree. Let us just think about the Irish sea border. Given the infinitesimal amount of goods and trade that cross that border—infinitesimal when compared with the proportion of EU trade—it is incredible that it has 20% of all the checks across the whole of the EU. That infinitesimal amount when set against the totality of EU trade warrants 20% of all the checks in the EU. It would be easier to bring in goods from Belarus into the EU than it is to bring goods from GB into Northern Ireland.

[Sammy Wilson]

The hon. and learned Member talks about that trade being infinitesimal—0.4% of EU trade crosses that border, yet it accounts for 20% of checks. Does he agree that that will not be the story of the future? In my constituency, we are already building a £140 million EU control post on a 10-acre site. Once that is open, there will be much more scope to check goods to an even greater degree. If that is not the point of having such a large EU border post in the middle of the United Kingdom, what is?

[Jim Allister]

That is the point, because it is an EU border. EU trade laws govern the Irish sea border. EU officials, under the protocol, have the right to supervise checking. When we have the full panoply of facilities that are being built at Larne and at other ports, I fear that we will see the muscle of EU inspections. The protocol gives the EU, which boasted that the price of Brexit would be Northern Ireland, the upper hand in that regard.

I return to the point that the protocol is imbued with a political motivation, and that motivation is not to get Northern Ireland the best of both worlds. My goodness, what a con that idea is. The protocol was supposed to make Northern Ireland a Mecca, a Singapore of the west, but we now know that there has been no uplift whatsoever in foreign direct investment. Why? Because a manufacturer coming to Northern Ireland is interested not just in selling goods out of Northern Ireland, but in where it is getting its raw materials. When a manufacturer is told that its basic supply line has to pass through an international customs border controlled by the EU, the shine soon goes off the prospect of investing in Northern Ireland.

We are in a pretty dire situation, which is getting worse, and which has massive constitutional and economic implications, but I fear that the Government are deaf and blind to the issues, because they do not want to face the consequences. They are hand in glove with the EU, dismantling Northern Ireland’s place in the United Kingdom, and setting us on a course for the economics marrying with the politics, and Northern Ireland ceasing to be.

--- Later in debate ---

[Hilary Benn]

The hon. and learned Gentleman may disagree. I am expressing the Government’s view, which is that it is not a credible basis. One thing is absolutely clear: the answer was never to try to wish the dilemma away and pretend that it did not exist. I am afraid that, at times, it has appeared as though that argument has been advanced.

The first go at trying to find an answer was the Chequers plan, which did not get support. The Northern Ireland protocol was the second go, but that was never going to work—I made that argument as an Opposition Back Bencher—so the Windsor framework was negotiated. There is no denying that the Windsor framework represents a huge improvement on the prospect created by the Northern Ireland protocol.

[Sammy Wilson]

The Secretary of State says that the situation is unprecedented, and that unique arrangements have therefore been put in place. The Government recently recognised that the flow of trade from the Irish Republic through Northern Ireland into GB could cause a situation where goods had to be checked to safeguard the GB market, yet they have been able to put in place arrangements, without all this elaboration, that do not require laws to apply to traders in the Irish Republic; they are simply checks away from the border. If the unique situation of trade from GB into Northern Ireland, which has a non-check border with the Republic, has to be dealt with through a labyrinth of regulations, why is it possible to avoid that in the other direction? If such arrangements can work from Northern Ireland to GB, why can they not work from GB to Northern Ireland?

[Hilary Benn]

The answer is this: as a sovereign country, it falls to us to decide how we check goods that arrive in our territory. For quite a period after our leaving the European Union, the last Government were not checking stuff coming across the channel, first, because there was nowhere to do the checks, and secondly, because they were concerned about delays, shortages and added costs for the consumer. They repeatedly put off implementing checks. At the same time, British exporters were experiencing the full impact of checks on the goods that they sent the other way, across the channel to Calais and the rest of the European Union. It is for sovereign countries to determine what checks they apply. The same truth applies to the European Union; it has a single market.

We are a responsible country. Some may argue that we should be irresponsible and say, “Well, this is not our problem; let us leave it to the EU to sort it out.” In the end, we had to have a negotiated answer to the question created by our departure from the European Union on the goods that cross that non-existent border. The one thing that almost everybody agreed on during the Brexit debates was that the border needed to remain as it was. That open border is important for a whole host of reasons, not least the extraordinary progress that Northern Ireland has made in the 26 years since the signing of the Good Friday agreement. The question, therefore, was: how does the EU ensure that goods that cross that border and come into the Republic, and go on to France, Germany or Greece, meet the rules? In exactly the same way, we would ask: how do we know that goods coming into the United Kingdom meet our laws? The only way to do that was with a negotiation.