Liz Truss protocol bill is economic and political risk for Northern Ireland, report finds

Traders will be caught between breaking UK regulations or international rules

The bill risks worsening inter-community relations, warns UK in a Changing Europe (PA)

Liz Truss’s legislation to tear up post-Brexit arrangements for the Irish border will bring “new levels of economic and political uncertainty” for Northern Ireland, a new report has warned.

The Northern Ireland Protocol Bill risks worsening inter-community relations, leaving traders in the province caught between two regulatory regimes and escalating tensions between London and Brussels, warned the report from the UK in a Changing Europe (UKICE) think tank.

It was published as the bill begins its passage through the House of Lords, where peers are expected to block or fundamentally alter it over the coming weeks.

Many members of the Upper House are deeply concerned at the prospect of legislation that unilaterally overrides an international treaty negotiated and signed by former prime minister Boris Johnson, which came into effect less than two years ago.

The government would not be in a position to force the legislation through against the opposition, as the Conservatives’ 2019 election manifesto included a commitment to passing the protocol as part of Johnson’s supposedly “oven-ready” Brexit deal.

Although recent weeks have seen a thawing of relations with the EU with the arrival of Ms Truss at 10 Downing Street and the resumption of talks on the protocol, it is feared that the bill’s passage would provoke a trade war with Europe.

And Tuesday’s report found that the legislation would anyway fail to avoid the requirement for a new election to the Stormont devolved assembly, which will be triggered if an executive is not formed by 28 October.

Sinn Fein’s first minister-elect Michelle O’Neill said there should not be a rerun of the poll which left her party the largest group at Stormont earlier this year.

“We shouldn’t have to have an election,” she said. “We had an election back in May. The people spoke, and the people asked for a functioning executive.

“They asked for us to make politics work and they asked for us to work together to deliver for them. That’s where I remain committed. That’s where I want to be.”

But DUP leader Sir Jeffrey Donaldson said his party will not drop its boycott of the power-sharing executive unless a solution is found to its concerns over the disruption caused by the protocol to trade with the British mainland.

“If the government wants to see the political institutions restored – and I want to see them restored – then we need an agreement which meets the objectives of the protocol bill,” he told the BBC.

Reports have suggested Ms Truss may be prepared to soften the bill’s rejection of any role for the European Court of Justice in ruling on disputes over the border – something which the DUP say should be ruled out.

Her spokesperson told reporters: “Our long-standing position is they shouldn’t be the final arbiter in Northern Ireland, but beyond that we want to continue to discuss that.”

Tuesday’s report warned that the bill could introduce “significant uncertainty” for business in Northern Ireland, with traders in the position of either failing to comply with UK law or failing to comply with international law.

This could create doubts about the legal basis for food to enter Northern Ireland from the rest of the UK, and could see dairy processors in the Republic refuse to accept milk from farmers in the North for fear of losing the status of their cheeses as legitimate EU products.

The bill gives “extremely broad” powers to ministers – so-called “super” Henry VIII Powers – to change existing rules for trade, subsidies and governance of the protocol in Northern Ireland, said the report’s authors.

And they warned that, although both sides have said they are aiming for a negotiated solution, their publicly stated positions remain “far apart”.

The introduction of the bill has already had a damaging impact on relations between the UK and EU. If it becomes law, it could lead to an escalation of tensions between the United Kingdom and the EU, because the EU considers it breaches the withdrawal agreement and thus international law.

UKICE deputy director Catherine Barnard, professor of EU law at Cambridge University, warned: “This bill places significant power in the hands of ministers to rewrite the Northern Ireland protocol, agreed between the UK and the EU just over two years ago.

“This has implications not just for UK-EU relations but also for the UK’s reputation as a country which complies with its international obligations.”

And co-author Katy Haward, of Queen’s University Belfast, added: “This is a bill that is purportedly intended to protect the 1998 Good Friday (Belfast) Agreement.

“But as it stands, it looks set to bring new levels of economic and political uncertainty for Northern Ireland, whilst not avoiding the need to call new assembly elections after 28 October.

“As a piece of legislation, it manages to be both exceptionally far-reaching and strikingly deficient.”

UKICE’s Jill Rutter, formerly a senior UK civil servant, said: “Notwithstanding the recent improvement in relationships between the UK and the EU, negotiations will still be difficult in a low-trust environment. Both sides should consider whether there is scope for better process to create the lasting solution Northern Ireland, the UK and the EU all need”.