Contribution to debate on Taxation (Cross-Border Trade) Bill, House of Lords, 4 September 2018

Watch debate on Parliament Live TV here

My Lords, it will come as no surprise to the noble Viscount, Lord Trenchard, that I disagree with virtually everything he said. As the Bill confirms, the Brexit charabanc is lurching giddily along, dragging our country towards a completely unknown destination. Even at this not-quite 11th hour, no Brexiteer, and certainly not the Prime Minister, has the faintest clue how we will be trading with our biggest partner—Europe—or any other country for that matter. No wonder the pound has plummeted and businesses engaged in any way with the outside world are at their wits’ end. It is therefore hardly a surprise that, although the Bill allows for the creation of a stand-alone customs regime for the UK, there is as yet no idea what shape it will take.

Everybody knows the mantra is “Brexit, dammit”, but nobody knows yet what it means, and maybe we never will until after we crash out into the nirvana of Trumpian free trade. That does not matter a jot because we will be free of Brussels—free, free at last—but God knows what new chains will now restrict our jobs, our prosperity, our businesses and our workers. I am no historian but I cannot think of any equivalent situation our country has ever faced as a result of a conscious act of government policy which says, “We’ve no idea where we’re going but we’re going there anyway”. Has the British political class ever done anything more utterly, profoundly irresponsible? Yet this Parliament, to our utter shame, has so far simply indulged in rubber-stamping it.

It should therefore be no surprise to anyone that the Bill illustrates how neither No. 10 Downing Street nor the arch-Brexiteers in the Conservative Party are now in control of their Brexit fantasies. Neither has a plan as the clock ticks down. What unites them is that it must click down regardless of the consequences. The people have spoken—full stop. We are going we know not where, but we are going anyway. This is rapidly becoming an act of collective national madness.

With the Chequers deal based on her flawed White Paper the Prime Minister was supposed to be keeping the UK close to the single market after Brexit, with some magical thinking about customs arrangements. Never mind that the services sector, forming a mere 80% of our economy, was abandoned. The importance of the Bill and the parallel Trade Bill should not be underestimated. Borders matter. Those who fantasise that the UK can enjoy frictionless trade under WTO rules need to understand that those rules mean hard borders, including within the island of Ireland. Even under the WTO’s most-favoured-nation rules, if we did not enforce the border in Ireland, we would be in breach of our agreements with other parts of the world, as would be, in parallel, the Republic and the EU. That would be a disaster for the economies of Northern Ireland and the Republic and would gravely threaten the peace and prosperity which have flourished since the Good Friday agreement of 1998, which is a binding treaty recognised under international law to which this Government pay lip service, but which is being steadily undermined by their whole approach to Brexit. No developed country trades purely on WTO rules, and it is fantasy to suggest that Britain should be the first to give it a go. Moreover, less than two weeks ago the director-general of the WTO pooh-poohed the idea that the UK could fall out of the EU straight into compliance with WTO arrangements, pointing out that it would take quite a time to negotiate the transition.

The debates on the Bill in the Commons demonstrated that the Government are a hostage to a minority of their own Back-Benchers, who chose to table four changes as wrecking amendments. The Chequers compromise can be seen as the Prime Minister’s attempt to steer her dysfunctional Cabinet towards a softer Brexit strategy that would mitigate, to some extent, the most damaging economic consequences of a hard or, worse still, a no-deal Brexit, but it started to fall apart at the first hurdle. Rather than risk defeat and a possible government collapse, these European Research Group amendments to the Bill were accepted by No. 10 and now potentially constitute new red lines, which may hinder the conclusion of a successful Article 50 withdrawal agreement.

The amendments in question were, first, to introduce the need for primary legislation if the Government want to keep Britain in a customs union. As my noble friend Lord Tunnicliffe and the noble Lord, Lord Kerr, have convincingly argued, and as Labour has compellingly argued, the case for a customs union with the EU is overwhelming—in order, among many other things, to avoid rules of origin requirements and check whether goods qualify for preferential tariff arrangements. According to the Government’s own analysis, these rules can burden businesses with additional administrative costs amounting to between 4% and 15%.

Furthermore, once the UK ceases to be regarded as EU territory, UK component parts and products will no longer benefit from zero tariffs as EU products under EU free trade agreements. That means that if the Government’s facilitated customs arrangement does not work, the fallback position will be no customs deal at all, which would be deeply damaging for our manufacturers. This could have a huge impact on UK trade and is the reason why a customs union is absolutely necessary for the sake of British manufacturing, international trade and Northern Ireland’s peace.

A second ERG amendment accepted by the Government ruled out a customs border in the Irish Sea between Northern Ireland and the rest of the UK. This was accepted as in line with the Prime Minister’s previous position, despite her commitment in the UK-EU joint report of 8 December 2017:

“In the absence of agreed solutions, the United Kingdom will maintain full alignment with those rules of the Internal Market and the Customs Union which, now or in the future, support North-South cooperation, the all-island economy and the protection of the”,

Belfast/Good Friday agreement.

The purpose of the second ERG amendment seems to be to destroy the negotiating room within which discussions on such backstop arrangements could take place. However, the most substantial and visible impact of the Bill will be at the UK’s borders—seaports and airports—and on our land border with the Republic of Ireland. It allows for the Irish border to return to being a customs border between the UK and Ireland. That means that goods leaving Northern Ireland will have to be cleared for exit from the UK and for entry to the EU.

First, goods crossing the border must be covered by a pre-departure declaration, partly to offer evidence of their status for VAT-free export. Secondly, goods will be able to enter the customs territory only through a designated place of clearance—which, for a land border crossing such as on the island, usually contains facilities for customs examination and clearance, including access to the relevant customs software systems to ensure that detailed information on the goods is submitted for recording and risk analysis purposes, and that correct duties are paid.

Thirdly, goods will be subject to customs duties from both sides. Fourthly, traders are more likely to be subject to requirements for import and export licensing. As the UK leaves the EU, all businesses in Ireland and Northern Ireland that trade across the Irish border will have to be properly registered to do so. Proper rollout of any trusted trader scheme requires time and agreement with trading partners.

Fifthly, the Bill will change common experience for VAT and Excise. Import VAT will be charged on all imports from outside the UK. Sixthly, if goods have to be inspected, there has to be the facility and capacity to do so. For the movement of agri-food produce, for example, including livestock, a rigorous veterinary and plant health inspections clearance regime must be in place. All of this illustrates the importance of getting a deal with the EU that avoids the need for customs controls between the EU and the UK.

How ironic it is, then, that this Bill also now contains a provision that risks making such a deal far less likely. The addition of this proposed new clause as a result of ERG dogma has ramifications not just for the Irish border; it also has implications for the current Brexit negotiations at a macro level. This was the Government’s intention in accepting it.

The so-called backstop in the draft withdrawal agreement is intended to prevent the scenario I have outlined previously coming into effect around the Irish border. However, what the ERG amendments, and therefore the subsequent new clause, do—in a fairly crude way—is to prevent that backstop being workable. It forces a scenario in which the Irish border is a customs border in the Bill. More to the point, by making it more difficult for the UK and EU to finalise the withdrawal agreement, it makes such a scenario all the more likely. This is no imaginary problem; there are no harmless consequences.

In July, the Prime Minister made her first substantial visit to Northern Ireland. When there, she visited the village of Belleek, on the Fermanagh-Donegal border. Belleek is in many ways a typical Irish border village. It has a population of Catholics and Protestants, British and Irish citizens, cross-border families and cross-border workers. A good number of such workers are employed by one business that straddles the border, with its front door in the Republic and its back door in the UK. As Theresa May’s entourage descended on the village, that business owner described the impact of the uncertainty around Brexit in a powerful way. “Out here”, he said, “We’re cannon fodder”.

The third ERG amendment Theresa May accepted makes it illegal for Britain to collect EU tariffs at its ports unless Brussels agrees to act on a reciprocal basis. The Government insisted that the amendment was consistent with the customs policy as outlined in the White Paper, because they envisaged using a formula to govern the flows of money based on trade patterns between the EU 27 and the UK. However, the White Paper does not explain exactly how this would work, and it seems highly unlikely that the EU will accept such a plan. There are further technical problems with the proposed facilitated customs arrangement, as it would appear to breach elements of the General Agreement on Tariffs and Trade—GATT—which is part of the World Trade Organization rules.

It is, in any case, a complete and utter delusion that the UK, with a market of 60 million, can improve on the negotiating strength we already have as a member of the EU with a market of 500 million, as far as free trade agreements with third countries are concerned. The point is that trade will become more costly and burdensome outside the EU single market and the customs union, and our businesses and manufacturers will be at a disadvantage compared with their European neighbours and competitors.

The ERG’s fourth amendment concerned VAT. Because the authorities need to know whether goods have crossed the border to properly apply the tax, the EU VAT area is absolutely crucial to avoiding a hard border. We currently have around 25 million customs declarations requiring payment of VAT at the border. That will potentially rise to 255 million after Brexit. Either goods are checked as they cross, requiring hard infrastructure and border friction, as happens in Switzerland and Norway, or we seek to stay in the EU’s system, which operates on the basis of a paper trail to track the movement of goods and requires European Court of Justice rules to apply. If the Government adopt neither option, it opens the UK up to massive fraud where goods enter the country VAT-free and people evade tax, depriving the Treasury—and therefore our already cut, battered and overstretched public services—of crucial revenue.

In conclusion, the debates on the Bill have illustrated that, as the reality of Brexit becomes clearer, the case for it disintegrates. Instead, the case for delaying Brexit and for giving not only Parliament but the people a meaningful vote, or a people’s vote, on any draft withdrawal agreement, becomes ever more compelling. I am delighted that my own trade union, the GMB, has today supported the principle of a people’s vote.

Nelson Mandela Centenary Exhibition

It was a privilege to Chair the Organising Committee for The Nelson Mandela Centenary Exhibition in South Bank Centre over July-August 2018 which attracted record numbers of visitors

With the Duke and Duchess of Sussex who kindly launched the Exhibition and Madiba’s granddaughter Zamaswazi Dlamini-Mandela
With only surviving Robben Island and Rivonia trialist the marvellous Andrew Mlangeni

Contribution to debate on Syria, House of Lords, Monday 16th April

My Lords, I agree that a line must be drawn internationally against the use of chemical weapons, but does not this terrible war also represent a catastrophic failure of UK foreign policy, beginning with bombast from David Cameron in 2011-12, which I am afraid the noble Baroness has repeated today, that Assad must go, refusing to allow both him and Iran into the negotiations—in other words, excluding the main players? This has never been about a barbaric Assad, as he is, against his people, but a complex civil war of Sunni versus Shia, of Iran versus Saudi Arabia, of the US versus Russia, an inter-state and proxy conflict involving also Israel, Turkey and the Kurds. Britain will remain culpable as long as we adopt a partisan role, rather than an honest broker role to promote a negotiated settlement to what otherwise looks like a war without end.

Contribution to Northern Ireland (Regional Rates and Energy) Bill, House of Lords, 27 March 2108

View contribution on Parliament TV

HL Hansard, 27 March 2018, cols 736-737

My Lords, I, along with other noble Lords, was proud to be a member of a Government who devoted so much time and effort over a decade to help Northern Ireland move from the horror of its violent past towards a better future. The devolved institutions set up in 2007, after a settlement that I helped negotiate, have not functioned for the past 15 months, and there appears to be little prospect of a change in that position. I have heard nothing from the Government to suggest that they have a clue what to do. Former serving Ministers in Northern Ireland such as myself and my noble friends Lord Murphy of Torfaen, Lord Reid, Lord Mandelson, Lady Smith of Basildon, Lord Browne, Lord Rooker and Lord Dubs, feel passionately about the way that the enormous peace progress made has gone so badly into reverse.

It gives me absolutely no satisfaction to say that I really do not think this Government get Northern Ireland. I make no criticism of the Minister or the arguments he has made, or of the Secretary of State—they are both new Ministers and I wish them all the best. But I observe—as I have said before, as has my noble friend Lord Murphy—that the Prime Minister’s approach, which is a kind of fly-in, fly-out diplomacy of insufficient in-depth detailed negotiation and relationship-building with all the parties and their leaders in Northern Ireland, was never going to work. You cannot achieve success in an impasse such as the one we face with this kind of approach. I urge the Government—No. 10 in particular—to reconsider this.

The measures in these Bills should never have had to come to us in the first place. They represent direct rule in all but name. But I do not think we can simply nod them through as a matter of process without addressing some of the implications of the current political impasse. The people of Northern Ireland are left in limbo, facing, as the noble Lord, Lord Empey, has pointed out so graphically, a serious crisis in the National Health Service, probably worse than in any other part of the UK. Last week I had the privilege to meet a group of remarkable people for whom that limbo is particularly cruel. They were members of the WAVE Trauma Centre’s injured group, and I will briefly recount two of their stories.

Jennifer was 21 in 1972 when she and her sister, who was shopping for a wedding dress, went into a Belfast city centre cafe for a coffee. A no-warning IRA bomb tore both Jennifer’s legs off. Her sister lost both legs and an arm. Noble Lords from Northern Ireland will recall the horror of the Abercorn bomb. Peter was 26 when he was shot by a loyalist gang in 1979 in a case of mistaken identity. Because of the configuration of the flat where Peter lived, the ambulance crew could not manoeuvre a stretcher around the stairs. They brought Peter down in a body bag. His father Herbert arrived at the scene and thought that his son was dead. “Oh my poor Peter” were his last words. He had a heart attack and died as Peter was carried to the ambulance. Peter is paralysed and confined to a wheelchair.

There are many more similarly harrowing stories. It is estimated that around 500 people in Northern Ireland are classified as severely physically injured as a direct result of the Troubles, with injuries that are at the very top of the scale: bilateral amputees, paraplegic, those blinded. All the injuries are life-changing and permanent. Because of their injuries most have been unable to work to build up occupational pensions and today have to survive on benefits. The levels of compensation paid through the adversarial criminal injuries compensation scheme were wholly inadequate and there was no disability discrimination legislation in the early days to protect them. Frankly, these people were not expected to live beyond a few years. But they have and the passage of time has compounded their problems as many suffer increasing physical distress as a result of deteriorating health and chronic pain.

They are campaigning for a special pension of the type that is in place in most other countries that have suffered from conflicts similar to that in Northern Ireland. All they want is some semblance of financial security and independence as they grow into old age in the most difficult circumstances. I find their argument compelling. The pension has been costed by independent consultants at around only £3 million to £5 million per annum—a figure which will reduce year on year as the majority of the severely injured are moving into old age. I appeal to the Government to provide this money now. It is a small amount to rectify a big injustice.

All the Northern Ireland parties are on record as saying that they support the idea of a pension for severely injured people such as those who come to see them and argue their case. But saying they support it is about as far as it has gone because their support for the severely injured is not unconditional. Of the 500 severely injured, there are 10 or so who were injured by their own hand; for example, planting a bomb that exploded prematurely. Of the 10, six are loyalist and four republican. It is no surprise that the DUP and Sinn Féin are split. The DUP says there can be no pension for those injured by their own hand. Sinn Féin insists that they cannot support a pension that excludes them as this would be tantamount to accepting a hierarchy of victims.

The injured group, who are unfairly drawn into this toxic debate, argue that it is not for them to say who should or should not qualify. What they do insist is that it is unjust, unfair and immoral for politicians to say that because they cannot agree about 10 people the other 490 must get nothing. I totally agree with them, and I hope the Minister will respond positively. The injured group, all of whom have been injured through no fault of their own, regard their plight as being as much a part of the legacy of Northern Ireland’s violent past as anything else, and the legacy issues are not devolved entirely. But the Government refuse to accept that they are part of the legacy for which they have responsibility. If the devolved institutions are, for whatever reason, unable to deliver on this—and of course, suspended, they are unable to deliver on this; and tragically, we are unlikely to see those institutions in place for some considerable time—the Government at Westminster surely must step in now, because it would be shameful if the people who have suffered so much through no fault of their own were told that nothing can be done because of political buck-passing.

On 20 February, in the other place, the Secretary of State said that she recognised the Government’s responsibilities to,

“provide better outcomes for victims and survivors—the people who suffered most during the troubles”.—[Official Report, Commons, 20/2/18; col. 33.]

I agree, and I appeal to her and to the Minister to act now. They have the power to do so. It is a very small amount; it would not be noticed on the overall allocation for Northern Ireland or, indeed, the Whitehall budget. It would not be noticed at all. I have met men and women in the WAVE trauma group who by any definition have “suffered most”, in the Secretary of State’s phrase. Unless both this Parliament and the Government accept that responsibility and act immediately to provide pensions for these 490 people, it will be to our eternal shame.

Irish Border and Brexit: Contributions to debate on European Union (Withdrawal) Bill, House of Lords, 14th March 2018

Watch on Parliament TV

My Lords, I am very grateful to my noble friend Lady Kennedy of The Shaws for enabling me to speak to this amendment on the common travel area and to Amendment 198 in my name and those of the noble Baronesses, Lady Altmann and Lady Suttie, and the noble Lord, Lord Kerslake. It seeks to deliver into statute what the Government agreed with the EU on 8 December:

“The Good Friday or Belfast Agreement reached on 10th April, 1998 by the United Kingdom Government, the Irish Government and the other participants in the multi-party negotiations (the ‘1998 Agreement’) must be protected in all its parts, and that this extends to the practical application of the 1998 Agreement on the island of Ireland and to the totality of the relationships set out in the Agreement.”

My noble friend Lord Browne of Ladyton will also address this specifically on Amendment 215, an important amendment that he has tabled with the support of other noble Lords—and noble Baronesses.

We scarcely need to remind ourselves that the Good Friday agreement, which my noble friend Lord Murphy of Torfaen negotiated, was a triumph of politics over violence in post-conflict Northern Ireland. When I spoke in this place over a year ago, I said that a hard Brexit and the hard border that would inevitably follow it would test the delicate balance of the three strands of the Good Friday agreement—relationships within Northern Ireland, between Belfast and Dublin and between London and Dublin—on which the peace settlement is based. That, sadly, is coming to pass.

The Good Friday agreement was a good-faith effort to take the toxin out of identity politics in Northern Ireland, where those who identified themselves as Irish could live with those who identified themselves as British and with those who see themselves as Northern Irish. There is no doubt that since Brexit, which the majority of people in Northern Ireland voted against, the divisive politics of identity is coming increasingly to the fore again. That is profoundly disturbing. Meanwhile, there has not been a local Administration for over a year—an equally profound government failure. Relations north and south are also deteriorating, to the extent that a senior member of the party propping up the Government can publicly call the Taoiseach a “nutcase”, and “not Indian” but a cowboy. To get the full flavour of that particular witticism, noble Lords need to know that Leo Varadkar’s father was born in Mumbai.

The tensions between the UK leaving the EU and Ireland remaining in it are clear. Following the phase 1 joint report on Article 50 on 8 December, the EU produced a 120-page document setting out the legal framework for fallback positions in the absence of agreement between the UK and the EU on the way forward. There were howls of protest and the Prime Minister rejected it out of hand, but where is the Government’s legal framework setting out what they think they signed up to on 8 December? Presumably, it sits alongside the Brexit Secretary’s impact assessments.

We are still desperately unprepared for Brexit and this is no more evident than on Northern Ireland. The UK Government, having agreed with the EU three months ago in the phase 1 agreement to maintain a frictionless border to preserve the Good Friday agreement, continue to fail completely to demonstrate how they can combine an open Irish border with the UK remaining outside both the single market and the customs union with the European Union. There is a simple reason for that—they cannot. Yet in her desperate attempt to keep her Cabinet—never mind her party—together, the Prime Minister continues to spin platitudes and delusion. Just last week, she was still maintaining that the United States/Canada border could be a model for an open border in Ireland. This is just nonsense. There are armed guards patrolling that border; there are flags on it; there is infrastructure on it—all the things that were specifically promised would not be on the border between Northern Ireland and the Irish Republic. If they were, they would be recruiting sergeants for mayhem, civil disobedience and attack.

Ministers still maintain the fiction that technology is the answer. All technological solutions require resources, infrastructure and preparation to implement. They do not substitute for the need for checks and inspections but merely aid the efficiency in crossing the border legitimately and identifying potential breaches of compliance or false declarations. As the former Permanent Secretary at the Department for International Trade, Martin Donnelly, has made clear, on the Northern Ireland border there is absolutely no evidence, and no serious expert in the customs field, who thinks that there can be an invisible technological border. He said that it does not exist anywhere in the world.

    • I am most interested but I wonder whether the noble Lord has looked at the evidence given to the Select Committee on Exiting the European Union in the House of Commons by the head of Customs and Excise, who said that whatever the outcome of the talks, there would be no need for infrastructure on the Irish border.

    • I know that evidence has been given but I simply stick to what I have argued, supported by the former Permanent Secretary at the Department for International Trade, who is an authority on these matters.

      I remind your Lordships of the report of the Public Accounts Committee in the other place, published last December. It said:

      “Government departments’ poor track record of delivering critical border programmes, such as e-borders, leaves us sceptical that they are up to the challenges of planning for the border post-Brexit”.

      The Foreign Secretary compares it all to the congestion charge between council areas in London. Sadly, he knows little about the issues and cares even less.

      The single market and customs union are not political deals but rules-based legal entities. As an EU member state, the UK has rightly insisted on the strict and consistent enforcement of these rules. Brexiteers, no doubt including the noble Lord, Lord Lamont, pretend that the EU can pick and choose to satisfy the UK that we can have all the benefits of being in the customs union and single market with none of the obligations, and that we can have an open Irish border while rejecting all the rules for keeping it open. That is like saying, “I want my country to play in the World Cup but I won’t recognise the offside rule”.

      The success of the Good Friday agreement was that it made the border between the two parts of Ireland virtually uncontentious, both to nationalists, because it had to be completely open, and to unionists, because any constitutional change in Northern Ireland’s status could occur only with a referendum. The threat to it which Brexit poses was eminently foreseeable. It is important also to note that the 1998 agreement is not a domestic contract or statement of intent; it is an international treaty between two states. The British and Irish Governments are bound in international law to implement the terms of this agreement. Its legal precedent is the 1985 Anglo-Irish Agreement, signed by Margaret Thatcher, which gave the Irish Government a right of consultation in the affairs of Northern Ireland. The 1998 agreement makes formal recognition of the Irish Government’s,

      “special interest in Northern Ireland and … the extent to which issues of mutual concern arise in relation to Northern Ireland”.

      The agreement expressed the British Government’s wish to “develop still further” close co-operation with Ireland.

      Strands 2 and 3 of the 1998 agreement, the cross-border and British-Irish strands, are international by nature and their future cannot be determined solely by the will of this Parliament. The British Government are legally bound, in partnership with the Irish Government, to ensure that the functions and objectives of this co-operation are unimpeded by withdrawal from the European Union.

    • My Lords, on the question of the Good Friday agreement, did my noble friend notice the significant exchange that took place in the House on Monday between my noble friend Lord Judd and the Minister, the noble Lord, Lord Bourne of Aberystwyth? When my noble friend Lord Judd said,

      “could the noble Lord confirm that the amendments to be brought forward by the Government will make absolutely sacrosanct the principle of the preservation of the Good Friday agreement?”,

      the noble Lord, Lord Bourne, replied,

      “My Lords, I certainly can confirm that”.—[Official Report, 12/3/18; col. 1397.]

      So the Government appear to have committed themselves to bringing forward amendments, I assume on Report, to enshrine their obligation to observe the Good Friday agreement.

    • If that is the case, as my noble friend has reminded us, then the Government should be supporting this amendment and putting it into statute.

      During the referendum campaign in 2016 two former Prime Ministers, Sir John Major and Tony Blair, both of whom made significant contributions to the peace process, gave speeches in Derry/Londonderry, in which they stressed that imposing a hard border between the north and the south of the island of Ireland would threaten the very basis of the peace process and the stability that the island of Ireland has enjoyed. Both have cogently reinforced their case in recent weeks and are as alarmed as any of us privileged to have served as Ministers in Northern Ireland.

      There are more crossing points along this 310-mile border than there are along the whole of the EU’s eastern frontier: 257 compared with 137. The border crosses family farms and separates towns and villages from their natural hinterlands. It is both invisible and ever present, both unremarkable and deeply contested. Even the younger generation on both sides of the border associates the very idea of border controls with conflict and collective trauma. As well as the formal movement of goods, there are many services from cross-border medical and pharmaceutical transactions to people and data movements between supply chains north and south and the infrastructure issues: energy, telecoms, air and rail travel, environmental standards and so on. If, as the Prime Minister insists, Brexit means the UK leaving the customs union and the single market—a rules-based legal entity, not just a political agreement—then Brexit would unavoidably mean the introduction of a hard Irish border.

    • Is my noble friend aware that the European Parliament has today voted by 554 votes to 110 for a framework agreement that supports seeking UK associate status but that the necessary frictionless trade can be guaranteed only by membership of both the customs union and the single market? That underlines the point he is making.

    • I understood that this was a proposal being put by, I think, the leader of the European Parliament, Guy Verhofstadt. I am grateful that my noble friend has brought it to the attention of the Committee.

      A hard border is one that consists of layers of barriers to movement—that is, tariffs, quotas, bans and regulations—and requires strict conditions and evidence of compliance to cross: declarations, inspections, authorisations, visas and permits. However, while harder borders require greater means of control and management by states, it is not the visibility of a border that determines how hard it is. The experience of a harder border is felt away from the border line in the obstacles faced by an individual or business when seeking to cross it legally to work, trade or operate on the other side. Hard border arrangements therefore threaten the evolution of a successful all-island economy, which is essential to the economic development and long-term prosperity of Northern Ireland.

      A combination of the conditions of EU membership and the operation of the 1998 agreement has enabled cross-border economies of scale, supply chains, public service delivery and practical co-operation to flourish. These are particularly essential in areas, such as those in the central border region, which have suffered the consequences of multiple deprivation and conflict.

      It is estimated that 30,000 people commute across the border every day. Around 1 million HGVs, more than 1 million vans and 12 million cars move between Northern Ireland and the Republic every year. Northern Ireland is also a vital route to market for goods from the Republic, with the UK acting as a land bridge to markets in the EU 27—some of the goods going through Wales, I might add. Approximately 40% of container movements to or from the island of Ireland go through Northern Ireland.

      Also threatened are 142 areas of north-south co-operation that have developed as a result of the implementation of the 1998 agreement. These range from an all-island regime for animal health and welfare to shared infrastructure and emergency healthcare planning and provision. They bring direct benefits to people on both sides of the border, and much of this co-operation relies on regulatory alignment across it. For example, Dublin Airport is the main entry and exit point for air travel for Northern Ireland, around half of whose residents use it for holiday travel. Brexit will also require a new aviation agreement between the UK and EU member states if there is not to be disruption to flights to and from Ireland to the UK.

One of the most tangible successes in economic co-operation post the Good Friday agreement is the single wholesale electricity market, known as the SEM. A report by the House of Lords European Union Sub-Committee on Energy and Environment, published on 29 January 2018, stated:

“The Single Electricity Market (SEM) on the island of Ireland has been a key dividend of the peace process, reducing energy prices in both Northern Ireland and the Republic of Ireland, and helping to achieve decarbonisation targets. It is therefore vital that the SEM is able to continue post-Brexit. Given that its functioning requires the implementation of EU energy laws in Northern Ireland, the mechanics of maintaining the SEM will require careful consideration and new arrangements, particularly if the UK were to leave the Internal Energy Market”.

Food and agribusiness, worth more than £4.5 billion, form the largest cross-border trading sector, relying hugely on EU membership for everything from farmer payments to tariff-free exports. The sector operates on a de facto all-island basis. Examples include the 594 million litres of milk that are imported from Northern Ireland for processing in Ireland. If import tariffs or even non-tariff barriers were put in place, that could decimate the Irish milk-processing sector. Nearly all the wheat grown in Ireland is sent north for milling and then re-imported back to Ireland. Nearly 40% of Northern Irish lamb is processed in the Republic, while a significant volume of pigs and cattle from the south are processed in Northern Ireland. The Bushmills distillery, the oldest working brewery in Northern Ireland, which claims to have invented single malt before the Scots and is located on the beautiful coast of County Antrim, has trucks making 13,000 border crossings each year.

The 1998 agreement was drawn up in the context of shared UK and Irish membership of the EU, and its practical implementation centres on continued regulatory alignment. UK withdrawal from the EU means that the trajectories of the UK and Ireland will now diverge. The divergence will be wide-ranging and will happen in law, trade, security, rights, policies and politics. Brexit therefore risks deep fissures between the UK and Ireland and thus puts the Good Friday agreement at risk. Brexit, with its re-emergence of exclusivist definitions of sovereignty, nationalism and state borders, threatens to destabilise the fragile equilibrium in Northern Ireland. There are those in the Cabinet and in the ranks of the ideological hard right who see the Good Friday agreement as a tedious encumbrance to their form of Brexit, rather than as the cornerstone of a hard-won peace process that is not yet complete. They cannot be allowed to put that at risk. That is why this amendment is necessary and why I hope it will be voted on on Report

Watch on Parliament TV

  • I welcome the noble Lord, Lord Duncan, to his post as a Minister and commend the empathy he has shown in responding to the debate, which I think the whole House welcomes.

    I will not respond to the whole debate—the hour is too late—except to commend the marvellous, passionate eloquence of the noble and right reverend Lord, Lord Eames. He would be able to get me to follow him on any theological journey, which is asking a lot of me. However, I regret that the Minister has not really responded to the questions put to him. For example, the Brexit Secretary said recently that there would be no problem monitoring imports and exports between Northern Ireland and Ireland after Brexit and there would be no need for a hard border because we already do this for VAT purposes. But we can do it for VAT purposes now only because we are in the European Union’s VAT Information Exchange System—VIES. Outside the EU, we are out of that tracking system. Then, on Sunday, the Chancellor admitted that there was not an example in the world of the kind of technological open border alluded to by the Minister. Who believes for a minute that it can be done, apart from the Foreign Secretary—who thinks that South Armagh and Louth are the same as Camden and Westminster, except with more Guinness?

    The Prime Minister insists that Brexit means the UK leaving the single market and the customs union, which I do not accept for a moment. We can Brexit and stay in the single market and the customs union; other countries are outside the European Union but are in either the customs union or the single market. But if she were right, the UK Government in turn would be obliged by WTO rules to enforce hard border arrangements on the island of Ireland because of the change in their relationship with the EU. Therefore, to keep the border open as it is today, there is no alternative to Northern Ireland—and, by implication, the UK—remaining in both the single market and the customs union. I regret that the Minister, despite his empathy, has not really answered that point. I will not press my amendment.