Rishi Sunak’s Brexit deal means more red tape for business, peers warn

Rishi Sunak’s Brexit deal will pile more red tape on businesses sending goods to Northern Ireland, a group of peers has warned.

The prime minister’s Windsor Framework, agreed with Brussels this year, will create “more burdensome” bureaucracy for many firms than the status quo, they said.

A report by the House of Lords committee on the Northern Ireland Protocol found the UK and EU’s post-Brexit agreement will help large retailers, but leave many others facing more paperwork.

They said hauliers will be particularly negatively affected, having to bear the brunt of much of the new red tape.

The committee published a report on the economic, political, legal and constitutional impact of the Windsor Framework deal struck by London and Brussels earlier this year.

The framework sought to cut the bureaucracy on trade between Great Britain and Northern Ireland created by the protocol.

It aimed to achieve this by creating red and green lanes to differentiate between goods whose end destination was Northern Ireland and those due for onward transport into the EU single market over the Irish border.

It also created a mechanism whereby a minority of Stormont MLAs could flag concerns about the implementation of new EU laws in Northern Ireland – a move that could lead to the UK government vetoing their introduction.

The DUP has been blocking devolution at Stormont for over a year in protest at the internal UK trade barriers created by the protocol.

The party says the Windsor Framework does not go far enough to address its concerns and has made clear it will not countenance a return to devolution until the Government provides further assurances, by way of legislation, over Northern Ireland’s place within the UK internal market.

The Lords’ report was informed by evidence from the UK government, EU Commission, business representatives, trade bodies, academic, legal and trade experts as well as community organisation representatives.

It found the framework’s benefits included the eased movement of retail goods; agri-food produce, including chilled meats; parcels; pets; and human medicines via the green lane.

However, peers cautioned that for some businesses the processes under the framework will be more burdensome than under the protocol as it is currently being implemented.

That is because the protocol, as it stands, is being operated with several grace periods and exemptions.

The committee called on the Government to answer outstanding concerns highlighted by business and retailers, including around the movement of livestock from Northern Ireland to Great Britain and back.

Peers also urged ministers to provide urgently further clarity on the framework’s labelling requirements on businesses and to set out how it will support businesses in adapting to these changes.

Peers said there was significant concern over a lack of clarity about the framework’s operation ahead of tight deadlines for implementation.

Pointing to multiple documents and legal texts that form part of the framework, the committee members said there was confusion arising from the “difference in emphasis” between the UK and EU in their descriptions of some of the provisions.

They urged London and Brussels to “explain clearly” to stakeholders what the provisions mean in practice and to publish a comprehensive summary.

The committee said the issue of regulatory divergence remains the “number one concern” of business representatives.

Peers said there was an underlying fear that Northern Ireland will find itself in a “no-man’s land” between Great Britain and the EU, a scenario that would place the competitiveness of Northern Ireland firms and their complex supply chains in jeopardy.

The peers expressed concern that a permanent solution to the movement of veterinary medicines from Great Britain to NI had not been achieved. Those medicines continue to flow into Northern Ireland from Great Britain due to a grace period that is set to run out at the end of 2025.

The committee noted the warnings it had received from industry representatives that, without a permanent solution, the supply of more than 50 per cent of veterinary medicines to Northern Ireland may be discontinued, posing a risk both to animal and human health, and to agri-food supply chains.

On human medicines, which are included in the framework, the committee urged the Government to respond to the calls from industry representatives for clarity over labelling requirements, safety features, the supply of medical devices and concerns that Northern Ireland may get slower access to cutting-edge products than Ireland.

Lord Jay of Ewelme, who chairs the committee, said the framework was a “distinct improvement” on the original protocol.

“But it does not solve all the problems which the Protocol raises,” he added.

“The benefits to business include easier movement of goods from Great Britain to Northern Ireland through the green lane.

“For some businesses, however, processes will be more burdensome under the Windsor Framework than under the Protocol as it operates now.

“And where there is uncertainty, the red lane, with its more complex procedures, may have to be used.

“Though the Windsor Framework is a clear improvement over the original protocol, it is highly complex.

“Businesses need clarity. The Government and the European Union both need urgently to explain what the Windsor Framework means in practice for businesses.

“The Government and the European Union need to remain closely in touch with each other.

“But they must also ensure that Northern Ireland stakeholders are closely engaged throughout.”

Trade representative body Retail NI welcomed the report.

Retail NI chief executive Glyn Roberts, who gave evidence to the committee in May, said: “This report sets out a fair estimation of the challenges which will be faced by the local business community with the implementation of the Windsor accord.

“We agree with its main recommendation that it is an improvement on the NI Protocol.

“It also rightly highlights issues around labelling requirements that impact on our members. Retail NI is disappointed at the lack of effective engagement on the labelling issue with only a few months to go before the new system is introduced.

“We need to ensure this new scheme works for independent retailers and large supermarkets alike.

“On the implementation of the Windsor accord, we need to see a more structured engagement with our local business sector, the EU and UK Government to address the opportunities and challenges ahead.”