Ministers plan to introduce legislation to change Northern Ireland’s post-Brexit trade arrangements in coming weeks as it faces a “very grave and serious situation”, Foreign Secretary Liz Truss has announced.
The government argues that without resolving problems caused by the Northern Ireland Protocol it will not be able to re-establish the Stormont power sharing executive and preserve progress made since the Good Friday Agreement.
The protocol averts the return of a hard border with the Republic of Ireland but has resulted in a new border in the Irish Sea – because some goods coming in from Britain are subject to customs checks.
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Power sharing has been put on hold because the unionist DUP refuses to join the executive until its concerns about the protocol have been resolved.
Ms Truss said problems included extra costs for businesses – with some stopping trade altogether – while also meaning that people in Northern Ireland were not able to benefit from UK policies such as VAT breaks on solar panels.
These had helped create “the sense that the east-west relationship has been undermined”, she added.
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Ms Truss said the problems meant the Good Friday Agreement was under strain because the protocol “does not have the support necessary in one part of the community in Northern Ireland”.
Britain says it does not want to scrap the arrangement and would prefer to come to a negotiated settlement with the EU, but says elements within it must be fixed and it would continue talks.
“However, to respond to the very grave and serious situation in Northern Ireland, we are clear that there is a necessity to act to ensure the institutions can be restored as soon as possible,” Ms Truss said.
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“The government is clear that proceeding with the bill is consistent with our obligations in international law and in support of our prior obligations in the Belfast Good Friday Agreement.”
Britain has been warned that unilaterally pulling out of the protocol could put at risk the wider free trade deal between the UK and Europe, raising the prospect of a trade war.
European Commission Maros Sefcovic said the plan for legislation was “not acceptable” and that Brussels would respond with all measures at its disposal.
Ireland’s foreign minister Simon Coveney said the unilateral action was “damaging to trust and will serve only to make it more challenging to find solutions to the genuine concerns that people in Northern Ireland have about how the protocol is being implemented”.
But Boris Johnson, speaking to reporters, said the changes were only “getting rid of some relatively minor barriers to trade” and that he did not think a trade war was likely to be triggered as a result.
DUP leader Sir Jeffrey Donaldson told MPs the move was “welcome if overdue”, and a “significant” step towards getting power-sharing in Northern Ireland back up and running.
Ms Truss said in the Commons that she had been through six months of negotiation with the EU, following a year of talks involving the previous foreign secretary.
She said the UK had come up with a “comprehensive and reasonable solution to deliver on the objectives of the protocol” which would address trade frictions as well as protecting the EU single market.
But the EU’s mandate would not allow such changes, meaning that proposals from Brussels did not address “fundamental concerns”, she added.
Ms Truss said: “This is not about scrapping the protocol.
“Our aim is to deliver on the protocol’s objectives.”
She said the bill would preserve elements that were working while fixing those that were not – on the movement of goods, goods regulation, VAT, subsidy control and governance.
“The bill will put in place the necessary measures to lessen the burden on east-west trade and to ensure the people of Northern Ireland are able to access the same benefits as the people of Great Britain.”
The new bill will propose a “green channel” to free goods moving and staying within the UK from unnecessary red tape designed to respect Northern Ireland’s place within the UK.
At the same time, it would ensure that goods destined for the EU “undergo the full checks and controls applied under EU law” underpinned by data-sharing arrangements.
