My Lords, I oppose the proposition that Clause 2 should not stand part of the Bill and that Clause 3 should also fall as a consequential amendment. If it was to succeed, the Bill would be rendered largely inoperative. In response to this, I am struck by two realities.
First, it is striking that the Government are saying, quite rightly, that the Bill is required urgently to avert a socio-economic and political crisis in Northern Ireland. Secondly, it is also striking that the democratically elected House has consented to that and deemed fit to pass the Bill with no amendment.
It is noticeable that many Northern Ireland Peers were yesterday copied into a letter of invitation—as already mentioned by the noble Baroness, Lady Hoey—sent to the movers of this amendment about the provisions in these clauses. It asked that, before they reached any final conclusions on the matter, they visit the logistics centres in Northern Ireland run by McCulla Ireland and McBurney to find out why it is not possible to apply the laws of international trade to regional trade without causing a crisis and to reflect on what they discovered before drawing any final conclusions. These are the largest haulage operators on the island of Ireland. They have considerable expertise on these matters. As Paul Jackson, the commercial director of McBurney, explained to noble Lords on the House of Lords Sub-Committee on the Protocol, were the protocol to be implemented, it would crash the Northern Ireland supply chain “within 48 hours”.
In focusing on the negative implications of the protocol, and the consequences for international law, I want to make it clear that it is not my purpose to deny that the protocol is having positive effects for some—although these would become limited if the protocol were to be fully implemented. My point is simply that, in a context where 95% of our British Isles trade is with Great Britain and only 5% with the Republic, the negatives far outweigh the positives.
The discriminatory implications of denying the people of Northern Ireland the same economic right to trade with their fellow UK citizens cannot be dismissed lightly, because they cut right to the heart of our citizenship. In another instance, the negative impact of the protocol is in no way comparable with the inconvenience arising from having to negotiate customs borders between different states and the application of the rules of international trade to international trade. The inconvenience arising from applying the rules of international trade to intranational or regional trade is far greater than the inconvenience arising from the application of the rules of international trade to international trade, which is why, with the exception of Northern Ireland, it does not happen elsewhere. Thus, we are not merely confronting a situation where we are not affording members of the same polity the same levels of respect as their fellows—seeking to treat them as if they were foreigners, rather than citizens of the same country, for trading purposes—but we are actually putting on Northern Ireland a far greater inconvenience than we put on traders from
other countries, and, in this sense, the UK is treating the people of Northern Ireland far worse than those from other countries.
To understand why this is so, and the implications of this from the perspective of international law, we need to understand the difference between international and intranational trade. With talk about globalisation, it is easy to get carried away into thinking that the world is defined by homogenous global economic flows, in which national borders are nothing more than an anachronism. But that is not the case: the borders, even between highly interdependent western countries, mark important lines of difference. For example, a lorry engaged in international trade will typically be a large vehicle and carry just one or two products. The cost of generating the paperwork associated with this, in terms of customs and SPS, will be tiny expressed as a percentage of the value of the cargo. By contrast, lorries engaged in trade within an economy often carry many different products, up to around 300. This is no problem because, within an economy, lorries can move freely. If, however, you introduce a border within an economy and require lorries travelling from one part to another to cross a customs border so that they must provide 300 separate customs declarations and 300 separate SPS declarations —or even more in the case of composite goods—the cost of generating the paperwork expressed as a percentage of the total value of the cargo becomes huge. It is so great in fact that the enterprise becomes either uneconomic or just not worth the bother. In this context, 200 companies in Great Britain have already ceased to provide goods to Northern Ireland, and if the protocol were to be implemented—let us not forget that it has never been anything like fully implemented—that number would increase dramatically, and we would be confronting a major socioeconomic crisis.
Some—such as the noble Lord, Lord Kerr—might respond to this by saying, “Well, why can’t Northern Ireland get its goods from the Republic?” It can to a degree, but only to a relatively small degree. It must be understood that Northern Ireland is a fully integrated part of the UK economy. If one looks at movements between GB and Northern Ireland, and between Northern Ireland and the Republic of Ireland, 95% is between GB and Northern Ireland. Only 5% is between Northern Ireland and the Republic of Ireland, and that is the case notwithstanding the fact that Northern Ireland and the Republic of Ireland have both been part of the European single market since 1993. It is not possible to restructure an economy overnight by cutting off the source of 95% of supply without creating huge damage.
In this regard, it is worth remembering that the Good Friday agreement is a treaty and part of international law, and the section entitled “Rights, Safeguards and Equality of Opportunity” commits to
“the right to equal opportunity in all social and economic activity.”
Yet the protocol now cuts Northern Ireland off from most of its own economy, with disastrous results. This is a real problem, because Article 2(1) of the protocol states:
“The United Kingdom shall ensure that no diminution of rights, safeguards or equality of opportunity, as set out in that part of the 1998 Agreement entitled Rights, Safeguards and Equality of Opportunity results from its withdrawal from the Union”.
In this context, notwithstanding the existence of Article 2(1), and the fact that the operation of the protocol has had the effect of diminishing the right to economic activity by cutting Northern Ireland off from most of its economy, the source of 95% of its trade, the EU has nonetheless refused to change a word of the protocol. The UK clearly has an obligation under international law to introduce the Bill before us today.
Finally, I urge noble Lords behind this group to take the opportunity to visit McBurney and McCulla before drawing any final conclusions.