I am grateful for the Minister’s response. As much as the Government are asserting that there will not be a challenge or confusion, it is necessary to have greater clarity for those who are putting the schemes together and those who will potentially challenge some of the recipients.
I am grateful to the noble Lord, Lord Lamont, for raising the issue of reach-back. It will remain an issue. The fact that the Government state that they will take responsibility for notifying the Commission about subsidies given does not necessarily mean that they will be free from challenge. Given the fact, from our discussions with my noble friend Lord Fox, that this is fundamentally a challenge-based system, greater clarity on this matter will be important—particularly given that there could be areas of dual approach.
We all know that Northern Ireland has a high number of intermediary businesses. These are for both businesses that have activity in Northern Ireland and GB and businesses based in Ireland or the European
Union that have some form of manufacturing or processing in Northern Ireland as well as in GB. These enterprises will, by definition, operate under dual systems and potentially apply for either state aid or subsidy control operations; indeed, I would be amazed if they did not. This means, therefore, that any of those applications or schemes are potentially open to challenge.
I did not agree with the Minister when she said that increasing the role to provide that certainty will represent an increased cost to taxpayers. I have read the impact assessment. If the Government are right that this applies to limited areas, I do not think that it will be a massive burden on the 19 people in the CMA who will be operating on this anyway. The Government seem to be relying on the fact that any confusion or uncertainty can be resolved by seeking advice from BEIS or Defra and the department’s subsidy control team.
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However, this is in contrast with other parts of the guidance in June 2021 which suggested that one of the solutions to this difficulty, which the Minister, the noble Lord, Lord Callanan, confirmed to me at Second Reading, is for businesses that are parent companies of those working in Northern Ireland to start operating two distinct sets of accounts. The Minister, from his sedentary position, says that he did not say that. I did not want to put words in his mouth for me to agree with, but he did confirm that one of the elements within the guidance was operating two separate sets of accounts. That suggests that the Government consider that there is likely to be an ongoing situation where a subsidy can either be challenged or policed by the Commission, or through the UK bodies.
The guidance is that if there is any doubt about whether the NI protocol applies, advice should be sought from BEIS or Defra subsidy control teams for industrial and agricultural measures respectively. I do not believe that seeking what is likely to be non-legal, non-public guidance from BEIS or Defra will be sufficient in this area. I respect the Minister’s response. I believe that there will be more that we must consider on this, and that we will be returning to the issue of Northern Ireland on Report but, in the meantime, I beg leave to withdraw my amendment.