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What should the DUP do now?

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Written by Graham Gudgin

The New Windsor Agreement which replaces the Northern Ireland Protocol leaves intact the framework of EU law applying to Northern Ireland. The application of EU law has however been relaxed for imports into NI from GB, and consumers in NI should experience few differences from those in GB. EU regulations still apply to producers in NI but cover only 12% of the economy and many of these regulations are global standards. The DUP would like to remove EU law altogether but continuing to stay out of the Assembly seems unlikely to achieve this end.

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Those who criticised the DUP for bringing down the Northern Ireland Assembly now have to admit that this tactic brought the EU to the negotiating table. Their pious opponents in other NI parties initially supported a ‘rigorous implementation’ of the NI Protocol but now welcome the changes contained in the so-called Windsor Framework. Boris Johnson’s now cancelled Protocol Bill, which would have allowed UK ministers to override the Protocol, added to the pressure exerted by the DUP. This Bill clearly worried the EU which has agreed reforms to the Protocol to ensure that the Bill will now be scrapped.

The fact that the UK had a strong bottom line meant that the recent negotiations were meaningful. In any case the EU were keen to move on. As Ursula von der Leyen put it in the press conference, the EU and EU share basic values and need to co-operate over Ukraine, climate change and other important issues. Running sores like the Protocol had become an unnecessary impediment, now that the EU has recovered from its funk over the acrimonious Brexit divorce and is now more secure that it will not fall apart.

The EU has moved a long way but let’s be clear, it has not given up its control over much of the NI economy. Lord Frost and Boris Johnson aimed to roll back EU law in the Protocol and replace it with UK law. While the Windsor deal softens the application of the Protocol, it does not change, indeed it arguably increases, the scope of EU law. The direct application of EU law in part of the UK ought not to be acceptable, and should never have been negotiated, but we are where we are. The current UK government and almost any conceivable administration accept the principle of EU interference in return for no land border on the island of Ireland.

Some unionists may insist that Northern Ireland be treated identically with GB, but the fact is that this has never been the case. NI had devolved government more than half a century before Scotland and Wales and for the last quarter century has had an almost unique form of involuntary coalition government which has proved inoperable for over a third of its existence. Northern Ireland was established in 1921 with too large a territory, incorporating too many Irish nationalists, and has proved close to ungovernable for significant parts of its history.  It is to the credit of the UK that it has survived as part of the UK for a century and is likely to continue to do so indefinitely. The recent ARINS poll found that a lower proportion of Catholics in the North (40%) favoured Irish unity than Catholics in the South. For many Northern Catholics, British rule has proved a positive experience.

Brexit and Protocol can be viewed as just another turn of the screw in the difficult task of managing the unstable polity that is Northern Ireland. In this case, the UK has badly mismanaged the consequences of Brexit in Ireland, but has had to face the reality that the EU is a major economic power with initially antagonistic intent. The UK should have persisted with proposals for the fully electronic border which the EU’s own advisors and even Irish customs officials agreed was possible. More recently the idea of mutual enforcement, with each jurisdiction having legally-based export controls, should have been pushed harder. The reasons for not pursuing these alternatives has been a fear of the consequences for trade and cooperation with the EU. There is little point in opponents of the protocol focussing solely on its local consequences without a consideration of the potential consequences for GB of a failure to reach an agreement with the EU.

There are two levels on which we should judge the new agreement. The first is on its practical consequences for trade, output and employment in NI and perhaps also in GB. The second is the constitutional impact. Most political changes in NI are seen, and should be seen, through the lens of their potential impact on NI’s position in the union. The latter is certainly how the protocol and the new agreement are seen. Nationalists in Ireland north and south like the protocol because they see it as bringing NI closer to the Republic and increasing the likelihood  of eventual Irish unity. Unionists oppose it for the same reason.

What Does the new agreement do?

Let’s examine the practical consequences first. The new Command paper claims that the new proposals ‘deliver on the core objectives of Frost’s 2021 command paper’ but this overstates the reality. Trade restrictions have been eased on goods from GB destined solely for consumption in NI, but a form of customs declaration is still required alongside certificates of compliance and checks for food imports. Customs details are even required for parcels from Amazon but the necessary customs data will be supplied by the firm and will be invisible to the individuals making online purchases.

Among other things, the new easements on trade incorporate the UK’s unilateral grace periods which the EU previously contested in the courts but now agree to make permanent. A major change is that the UK’s Trade Support Service (TSS) will complete the 21-line customs declarations, based on normal commercial data supplied by firms. This is what was originally billed as the purpose of the UK-funded £350 million TSS when it was set up two years ago, but it became instead an advisory service.

Derogations and clarifications have made life easier for imports from GB by disapplying or relaxing a raft of EU regulations but EU law remains in place and the EU reserves the right to remove the concessions if it loses trust in the UK in future. Some view these concessions as more apparent than real. It is currently unknown how difficult or costly it will prove to access the trusted trader status required to avail of these ‘green lane’ easements. It also seems that the green lane will only be available for consumer goods with clear endpoint outlets in NI. Intermediate goods for further processing in NI will still be vulnerable to checks and significant paperwork.

Importantly, the panoply of EU regulations governing manufacturing and farming inside NI remain in place. Significant parts of the NI economy are governed from Brussels not London. The UK side has made much of the ‘Stormont brake’ by which London can disapply any new EU regulations on firms in NI but only, it seems, in extreme circumstances. Existing regulations will continue to apply even if the UK changes regulations in GB. If for instance genetically-modified flour was allowed in GB, it could be used in cakes sent to NI marked as not for sale in the EU. The flour could not, however, be used by bakers in NI as long as EU prohibitions remained in force. This could put NI producers at a disadvantage selling into markets in GB and indeed also those in NI. Future divergence from the UK is likely to cause increasing frictions unless the UK is able to challenge existing as well as future EU regulations.

Firms in NI generally supported the protocol and similarly have little objection to the new Windsor agreement. They appreciate customs-free access to Irish and wider EU markets and see little difficulty in complying with the familiar regime of EU regulations including the new ones which continually stream out of Brussels. Future GB divergence from EU standards may cause problems in NI but few local producers expect much difficulty. Few UK divergences have emerged in the two years since we left the single market and few are being signalled. Even so, this may prove a significant issue for the entire UK in future. A worry is that the possibility of UK divergence from EU regulations, one of the key advantages of Brexit, may now be prevented or slowed because these would also lead to divergence between GB and NI.

On the other hand, divergence may prove to be of limited importance. The EU regulations apply to under 12% of the NI economy with a quarter of manufacturing sectors having no EU regulations. Moreover, the new White Paper claims that most regulations refer to global production standards which both the UK and EU have already undertaken to observe. The claim is that of the 3600 applicable global standards there are only 11 which differ between the UK and EU. There may of course be more differences in future but the UK has not rushed to impose standards which differ from global norms and is likely in future to continue to adopt global agreements. Most NI firms will not object to the retention of these regulations since they allow companies to retain their advantage  in having customs-free access into  EU markets. They will argue that the previous ‘price’ of this benefit in higher import costs has been reduced by the new trade arrangements.

The EU will now allow a range of previously prescribed goods like chilled meats into NI. However, the new rules will be little noticed by consumers in NI since proscribed goods, medicines and parcels were already reaching NI due to the grace periods. The advantage is that the grace period easements are now mutually agreed and cease to be a legal sore. The reduction in customs administration should reduce prices by a few percent but in reality the gains will not be identifiable among the many other inflationary pressures.

In summary, the impact of the revised trade and production arrangements are likely to be light and largely invisible to consumers in NI. The checks on 5% of food import consignments are largely ‘identity’ checks, i.e. brief checks that vehicles are what they say they are. These should impose few delays or costs, but time will tell whether this works as we expect. Difficulties over regulations will depend on the degree to which the UK diverges, or wishes to diverge, from EU standards. If new EU regulations prove unacceptable, there is an arbitration procedure to deal with it. Again, time will tell whether this can ever be used, or if it is used whether it is effective. It is possible that little of this will prove problematic, but if serious problems emerge the UK will have to think again.

The constitutional impact

For the DUP and indeed all of those concerned about the future of the UK union, the more important issues are likely to be the constitutional impact. My own estimate is that the new arrangements are unlikely to have much impact on the likelihood of a border poll or a future united Ireland. One concern was that firms might use Irish MEPs to lobby the EU over regulatory changes but the new arrangements allow more direct consultation for NI firms. It may be that the WF still results in more GB firms refusing to supply NI than was the case prior to the Protocol coming into force, but those with long memories will know that it was always the case that some goods and services were unavailable in NI. Lower transport costs and the internet reduced the number of such restrictions and they seem likely to remain minor, but if not then further adjustments will be necessary.

What should the DUP do now? Some will argue for further concessions but substantial changes will not be forthcoming. The retention of EU law and the oversight of the ECJ is an indignity that unionists would much prefer to avoid, but if most NI firms and most of the public are unconcerned about these issues, then many will not understand any unwillingness to return to the Assembly. Polls have suggested that the only NI party whose voters prefer staying out of the Assembly rather than accepting the Protocol is the TUV with only one MLA in the Assembly.

The reality now is that British public opinion wants the Protocol issue put to bed and believes that Sunak has achieved this. They welcome a normalisation of relations with the EU and even if this amounts to little in practice, they appreciate a warmer tone. An alliance between the DUP and the ERG exercised real influence as long as a Tory government remained in power, but key members of the ERG have accepted the WF, and DUP influence has thus waned. The DUP are not now in a position to prevent the WF from being implemented and even if they were, the EU could sit and wait for a Labour Government to implement the arrangements. One advantage of a settlement on the Protocol is that it limits the scope for an incoming Labour administration to argue for dynamic alignment with EU regulations across the entire UK. Some will say that the WF imposes de facto alignment anyway, but as argued above this issue is likely to be less important in practice than it appears in principle.

The choice is difficult for the DUP but the best bet may be to accept what is on offer as a partial advance while continuing to campaign to remove EU law altogether. The ongoing campaign could be pursued inside the Stormont Assembly and Executive. The next stage in this campaign can come in 2024/25 when the existing Protocol provides for an Assembly vote on whether the Protocol should survive. The DUP will need to persuade other local parties to support major improvements to the Windsor deal. This will be difficult but is not impossible and will depend on future events.

Dr Graham Gudgin CBE was special advisor to the First Minister in Northern Ireland 1998-2002. This is a much extended version of an early reaction to the Windsor Framework published on the Spiked website at: https://www.spiked-online.com/2023/03/02/brexit-is-far-from-finished-business/

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About the author

Graham Gudgin