That this House has considered barriers to trade in the UK internal market.
I am pleased to have been granted this debate. I do not have much luck securing debates in Westminster Hall, but I thought that perhaps nobody else would apply for a debate at the end of the last day before recess. I think I guessed right, so we have a debate on this very important issue.
This debate is about the disruption to the UK internal market. My remarks are not based on the political stance that my party has taken against the Brexit arrangements agreed by the last Government and continued by the present Government; they are based on a report by the Federation of Small Businesses, an independent body interested only in the concerns of its members, that does not look exclusively at Northern Ireland. Indeed, the report is based mostly on responses from businesses in England, Scotland and Wales—only 14% of responses came from businesses in Northern Ireland. The impact on the internal market is a UK-wide concern.
The report found that the Windsor framework is not protecting the market. There are considerable barriers, whether customs paperwork, European Union rules and laws applying in Northern Ireland, physical checks, delays in the delivery of goods, the labelling of goods not for EU use, or business-to-business parcels now being subject to customs procedures. As a result, many businesses have abandoned Northern Ireland. Indeed, the report highlights that 34% of small businesses that previously traded with Northern Ireland have now stopped, saying that the regulation has made it far too expensive to trade with Northern Ireland.
Some of the regulations are ludicrous. One business wrote that some of the requirements are little short of farcical. They have to state that their goods have not been imported from Iraq, even though they were made in Great Britain. Others have been told to fill in forms to make it clear that canes imported for use in road construction are not being used to torture anybody. Businesses find themselves facing that kind of nonsense, and as a result they are abandoning Northern Ireland.
I congratulate the right hon. Gentleman on securing this debate. Is not the real problem, as identified by the FSB and articulated by the right hon. Gentleman, that there is an unholy alliance of Eurocrats and bureaucrats, of separatists and globalist corporates, who are acting in a way that is injurious to the interests of small and medium-sized businesses that trade across our United Kingdom?
The right hon. Member is absolutely correct. I will talk about some of that bureaucracy later in my speech.
Fifty-eight per cent of businesses have faced significant or moderate difficulties, including rising transport costs, significant disruption to supplies, stock shortfalls, shortages, loss of sales and increased bureaucracy and costs, as well as the drain on their finances because of the payment of taxes and duties that take a long time to be repaid.
Of the companies surveyed, 61% said that they had experienced negative consequences as a result of the Windsor framework. Significantly, despite what the Secretary of State for Northern Ireland would try to tell the House, only 2% said there were any positive benefits. More worryingly, 56% either said that they are “not confident” or only “slightly confident” about what will happen with their trading relations with Northern Ireland, and 29% said that they are likely to have to stop supplying to Northern Ireland in the future. That is on top of those companies that have already stopped.
In fact, one company said that it was now more difficult to trade with Northern Ireland—that is, bring goods from GB into Northern Ireland—than it is to trade with Australia and the USA, which is why it would stop trading with Northern Ireland.
What has been the Government’s response to all this, as it is well known? I am pleased that the FSB has now independently verified what we have all known anecdotally, as constituency representatives. I suspect that the Minister will say, “Oh, but we are doing our best. We have put in support mechanisms. We have the trader support service, we have HMRC guidance.” I hate to tell the Minister that the survey shows that 78% of businesses say the support is either “poor” or “very poor”—in other words, useless. The report says,
“a similarly high proportion found access to the support difficult. Businesses frequently cited confusing or inconsistent guidance. As one NI manufacturer put it, navigating new customs paperwork via the Trader Support Service often feels like a ‘guessing game’.”
It is a pleasure to serve with you in the Chair, Dr Huq. I congratulate the right hon. Member for East Antrim (Sammy Wilson) on securing this debate, which cuts to the very heart of what it should mean to be part of the United Kingdom.
If we construct, at a foreign institution’s behest, an internal international border within our own country and require customs checks and declarations, and the payment of tariffs on the movement of goods, it should be no surprise that we will hugely upset our country’s internal market. That is exactly what has happened. I would go further and say that that is exactly what was intended, as it was notoriously said in Brussels that the price of Brexit would be Northern Ireland. What we have evolving before our very eyes is the dismembering of the United Kingdom, as an object lesson to any other member state of what happens if they dare to leave the EU.
We have created a situation where, because Northern Ireland is in the EU single market and under its customs code, GB is in law decreed to be, within EU terms, a foreign country whose goods must be checked when they move to within the EU, which is how Northern Ireland is regarded as far as the single market is concerned. It should be no surprise that there will be disruption to the market as a consequence. It was the intention of the EU to build an all-Ireland economy as a stepping stone. That was the design, and the protocol is working in that sense: it is delivering what it was intended to deliver.
When we hear from the FSB report that 34% of businesses that previously traded with Northern Ireland have stopped trading, that inevitably means that trade with the Irish Republic—it was the purpose of the protocol to build an all-Ireland economy—is increasing. We have statistics from the Northern Ireland Statistics and Research Agency to show that, over recent years, purchases from the Irish Republic have increased by 50% in comparison with those from GB, taking account of inflation. We therefore have the protocol in action illustrated for us, and its intention to build an all-Ireland economy.
It is a pleasure to serve under your chairmanship today, Dr Huq. This matter is crucial because it deeply affects British livelihoods, communities and the unity that we hold dear in the United Kingdom. To those who prematurely claimed or exaggerated that the Irish sea border was removed, I say, “You’re overlooking the harsh realities faced by many businesses in Northern Ireland.”
The numerous cases speak for themselves, and I will share several today. Only last week, four loads of food supplies were sent back in a 48-hour period from a port in Northern Ireland because of these regulations, affecting chilled and frozen foods. Recently, a lorry driver who owns a lorry-driving business mentioned that one sixth of his business is being negatively affected by the Windsor framework. The Secretary of State claimed that food supply and veterinary issues were resolved—that is clearly not the case. Why are food lorries being turned back from Northern Ireland ports?
I go shopping in a local supermarket in my constituency. In the last 10 days, I have been into that supermarket about half a dozen times. I have not even been able to get corned beef or doggy treats for my dog—my dog loves his doggy treats, and we have not been able to get them. Those are just basic items that face problems getting into Northern Ireland. That is why I stand firmly against any trade barriers between Great Britain and Northern Ireland. It was unacceptable then and remains unacceptable now.
This debate transcends commerce; it is about the integrity and unity of the United Kingdom. First and foremost, these barriers disrupt a legacy of seamless trade, which we have enjoyed for decades. They place additional costs and burdens on businesses in Northern Ireland. We take pride in our small, family-run businesses, which form the backbone of our economy. I implore the Minister to empathise with these businesses as they face challenges in sourcing or sending products across the Irish sea and become entangled in complex regulations that hinder rather than help. He should see it from the perspective of these businesses and ask, “Is this truly fair to fellow citizens in Northern Ireland?”
It is a pleasure to serve under your chairmanship, Dr Huq. I thank the right hon. Member for East Antrim (Sammy Wilson) for securing this debate.
I am sure that we will hear in the Minister’s response what the Government have done to alleviate some of these issues, but it is the practicalities that Members from Northern Ireland are actually asking about. I am sure that we will hear about Lord Paul Murphy’s report. He was commissioned to conduct an independent review of the Windsor framework. I am now aware that his report was handed to the Government on 9 July, so we have to ask, “When will we see it? When will businesses see it? When will trade and industry actually see what Lord Murphy has said?” I am sure that the answer we will get is that under domestic law the Minister has up to six months to publish the report and its recommendations. Why not publish it now? Why not let businesses and politicians see the challenges that lie ahead?
Two bodies were created at the time: the independent monitoring panel and Intertrade UK. Those organisations were launched with much noise and furore, and good people—genuine people—were appointed to them, but we have seen no product. We have seen nothing come from them with regard to the challenges, and the opportunities that people keep talking about but that nobody is prepared to put in writing.
With regard to the challenge that we currently face, the introduction of “Not for EU” labelling on 1 July, which has been touched upon, applies even to goods that will never leave the UK’s internal market, and adds yet another layer of complexity and cost. Businesses have been told that these labels will eventually be phased out, but the requirement to have them now still stands. For a large retailer, that may be a frustration, but for a small supplier or producer it could be the final straw.
That was evident in the FSB’s independent report. As the right hon. Member for East Antrim pointed out, this is an independent report commissioned by the FSB from GB suppliers providing goods to Northern Ireland. Those suppliers said that trade disruption is widespread, with 58% of those trading between GB and NI reporting “moderate” to “significant” challenges. Over a third of respondents—34%—have already ceased trading rather than deal with these new compliance issues.
Order. We will move on to the first Front Bencher, Liberal Democrat spokesperson Clive Jones, at 5.8 pm, so the time limit is now three and a half minutes.
It is a real pleasure to serve under your chairship, Dr Huq.
I thank my right hon. Friend the Member for East Antrim (Sammy Wilson) for his continued dedication to highlighting the absurdity of the Windsor framework and the need for an end to this disastrous mechanism. All hon. Members who speak in this debate have outlined and will outline the barriers that affect business across the whole of Northern Ireland. We are aware of the problems that we are raising, but I urge the Government to fully consider their impact. The Minister is a good man; he listens, and always tries to respond, so we look forward to his response on behalf of Government.
The Government will say that this is only a small additional bit of paperwork to do, and that businesses should be able to comply with the two-lane system and the administration, but the fact is that, while they could comply, it is more hassle, so at the system’s worst they are simply not complying.
I will give two examples that affect households throughout Northern Ireland. Morris & Son Ltd specialise in near-date sales and clearance lines that are cheaper and enable shops to pass on deals. Morris Ltd has said that the product margins on such products are too small to justify the time it takes to administer the additional protocols, when it can sell with no hassle on the GB mainland.
I do not say this to shame Morris Ltd, because that is not what this is about; the shame is on the current and the previous Governments for not rectifying the issue, but the losers are those on low incomes, who used to be able to get a good deal on short-dated stock. The constituents of every hon. Member in this House can take advantage of that, barring my constituents in Strangford and people in other constituencies of Northern Ireland. At a time when food inflation stands at 4.5%, and is predicted to be 5.1% by the end of this year, why should my constituents, and people across Northern Ireland, not be able to take advantage of those offers?
The protocol and Windsor framework continue on a daily basis to fail the people of Northern Ireland. The failure is not anecdotal; it is measurable, documented and deeply felt. I say this with sincerity: it is a bureaucratic burden, a constitutional compromise, and for many of our people and businesses, an economic noose.
The Secretary of State and the Government cannot continue to keep their heads in the sand, thinking that the problems that we highlight are all exaggerated and unimportant. Businesses, farmers, hauliers and animal health professionals are affected. Every sector is engaging more and more in highlighting the daily struggles associated with the framework and calling for help from the Government they pay their taxes to.
The reality remains that Northern Ireland is subject to EU laws in more than 300 areas—laws that we have no democratic say over, no way of changing, and that are creating burdensome and costly checks that no other part of the UK endures. The Windsor framework was sold as a solution. It was never a solution. It was a glossed-up version of the protocol with a new name, but it was the same poison. It raised hope among businesses in Northern Ireland, but has delivered dismay, frustration and additional costly trading barriers.
I have always been critical of the Government’s approach to Northern Ireland when it comes to Brexit, be it under the previous or the current Government. I never believed the spin and promises, because at every turn promises have been broken and there has been no desire to resolve even the most simple problems created by the Windsor framework.
I commend the FSB for its courage in producing an exceptional report. Many so-called industry leaders are all too often caught up in the spin and do not actually reflect their membership’s concerns. Yet the FSB’s latest report lays bare the truth: 58% of businesses face moderate to significant challenges, and more than one third have stopped trading with GB altogether, rather than deal with the mountain of paperwork. This is not frictionless trade. It is not the “best of both worlds”. It is best only for the EU.
As ever, it is a pleasure to serve under your chairship, Dr Huq. I thank the right hon. Member for East Antrim (Sammy Wilson) for securing this debate.
The majority of people in Northern Ireland voted to remain in the EU. The Conservatives’ botched withdrawal agreement has caused nothing but problems for the Northern Irish economy and has hit small businesses particularly badly. The Conservatives said that they had an “oven-ready” deal for leaving the EU, yet they left Northern Ireland in the deep freeze. The idea of dual market access under the Windsor framework was sold as a unique advantage for the people of Northern Ireland—businesses would be able to access both the EU single market and the UK internal market—but widespread dissatisfaction with the Windsor framework is becoming increasingly clear. Northern Ireland should be able to exploit dual access, but businesses are not being helped by the Northern Irish Executive, nor by the UK Government.
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It is a joke of a system. The defence is, “We have put in support mechanisms.” Well, they are not working.
The second argument—and we have heard the Secretary of State make it repeatedly—is, “Oh, but you have other benefits. You have access to the dual market. You have the benefits of being able to sell into the EU, which companies in GB cannot do as freely, and to sell into the GB market.” We know now that the GB market is not accessible, and that supplies are not coming through.
As far as the dual market system is concerned, when businesses were surveyed, 88% said that the opportunities were not explained—they did not know what the opportunities were—and 64% said that they did not even understand what the opportunities were. They said that it seemed like the Government were making no effort to promote the great benefit that was meant to be the result of the Windsor framework. I suspect that the reason why the benefit has not been promoted is because, as many of the companies said, it is more in theory than in reality. There is no real benefit.
Of course, the latest argument is, “Well, the new sanitary and phytosanitary agreement with the EU will smooth it all out.” Every time I hear that argument, if I am at home, I look down into Larne harbour from my study window and see that, despite the promises that the SPS agreement will do away with a lot of these checks, there is a border post being built—I can see it clearly from my study window. £140 million is being spent on it, and only last night, the local council was asked to sign a memorandum of association to ensure that it supplies staff for that border post until March 2029.
Even if the SPS agreement were to do that, it covers only a very small part of the trade. All of the customs requirements, duty payments, checks, delays and parcel post will still be affected. EU regulations, affecting many businesses because the EU has different standards, will still apply.
The one thing I hope I do not get from the Minister today is the same complacency, disdain and “I couldn’t care less” attitude that Northern Ireland experiences from our Secretary of State, whose attitude has been little short of disgraceful. Pontius Pilate-like, he has washed his hands of it all. If anything, he acts more like an EU emissary to Northern Ireland than a Secretary of State for Northern Ireland. I can see that you are getting a bit uneasy, Dr Huq, but I notified the Secretary of State that I am angry at the way in which he has treated Northern Ireland, and he knew I was going to make these remarks this afternoon. In fact, I think I spelled them out to him.
Let us look at some of the Secretary of State’s comments. When my hon. Friend the Member for Upper Bann (Carla Lockhart) recently raised a statistic from the FSB survey in the House, his attitude was, “Well, if some of the businesses can trade with Northern Ireland, why can’t the rest of them? It is up to them to decide where they want to trade and where they don’t.” When someone who is meant to be standing up and fighting for Northern Ireland takes that kind of attitude, I despair about whether this issue is being taken seriously.
In a recent letter to me, the Secretary of State indicated that, as far as he is concerned, the main thing is to ensure that we “faithfully” pursue the Windsor framework because the EU is getting angry that some of the regulations may not be fully implemented. Here we have damaging regulations for Northern Ireland, and the Secretary of State’s response is, “Well, I have to stand up for the EU. Northern Ireland businesses? Let them paddle their own canoe.”
I know that others wish to speak, and I am pleased that so many have stayed on the last day. I do not want them to miss out, so this is the last thing. What do we need? I could go through many of the options that we have proposed and that the Government have dismissed, but I ask the Minister for one simple thing. All the paperwork, all the regulations, all the delays and all the checks are founded on one thing: that goods entering Northern Ireland from GB are regarded as at risk of going into the Irish Republic, contaminating its economy in some way and breaking EU rules.
Custard, the stuff we heat and pour over apple tarts or put into trifles, was deemed to be a dairy product, but it was not required to be labelled until phase 3 of the labelling requirements. However, the EU decided that perhaps custard should have been regarded as a product at risk, so it changed the labelling requirements. One of the big supermarkets had custard in its supply chain, and the EU bureaucrats decided that this custard must be hunted down—“We cannot have it coming into Northern Ireland and finding its way into the Irish Republic.” Lorries with mixed loads were stopped and searched. The offending custard was hunted down, discovered and exposed. That delayed the lorries, which did not reach the depot in time, so their goods could not be broken down and distributed to the various shops. It affected the supply chain and the supply of shops in Northern Ireland.
Here is the irony: the supermarket did not have any shops in the Irish Republic. The offending custard was okay one day, but not the next, because it did not have a label that it did not require the previous day. There was no evidence that anybody was dying from eating this custard in Northern Ireland or anywhere else, but the supply chains for a major supermarket in Northern Ireland were disrupted.
I am sure many Members could tell story after story about how the regulations are having an effect. What is it all down to? It is down to goods presenting a “risk”. What risk? We do not know. A simple change could be made so that goods are deemed at risk only once they leave Northern Ireland and go into the Irish Republic or elsewhere. The Road Haulage Association and Federation of Small Businesses have asked for that. It is not beyond the wit of man to ensure that happens. After all, all the companies that are selling these goods have VAT returns. HMRC trusts those companies at the end of the year to declare how much VAT they owe. If the goods have gone out of Northern Ireland, they do not have to pay VAT. Why can that VAT return not be used to follow the goods to where they eventually go? There is much disruption to trade, though not to all of it.
I am sure Members will talk about the inequity and constitutional implications of EU law applying to Northern Ireland, but one simple change can be made. Rather than kowtow to the EU, or be afraid that the reset with the EU might be disturbed if we ask for something simple, I ask the Minister to consider that one simple change, which many businesses have said would restore their ability to trade freely within our own market, selling goods that are not at risk. It would be of immense help to the small businesses that are the backbone of our economy.
All that is set against a background where the Minister present today is under a statutory obligation, under section 46 of the United Kingdom Internal Market Act 2020, to secure and maintain Northern Ireland’s internal place in the UK market. It is supposed to ensure that goods can travel freely, but it does not and never will, because that is impossible to achieve.
More than that, with all the spin that attended the Windsor framework, we were told that we were protected under article 16. If there was any diversion of trade, we were told that the Government would step in and take actions permitted under article 16. Well, there has been diversion of trade—lamentable, demonstrable and huge diversion of trade—and what have the Government done? Nothing. They have simply run away, taken a blind-eye approach and refused to act under article 16.
Indeed, only a few weeks ago in a Delegated Legislation Committee, I had a Minister tell me that article 16 specifies that there has to be
“a massive distortion to trade.”—[Official Report, First Delegated Legislation Committee, 23 June 2025; c. 9.]
No, it does not; it refers to any diversion of trade. There has been a diversion, but there has been no action, which makes the Government wholly complicit in the dismantling of this Union and the divorcing of Northern Ireland economically from the rest of the United Kingdom. Unless and until that is addressed, this issue will not be settled.
The Government talk much about their great reset—well, they had an opportunity, and they did not take it. If they are going to align SPS rules, why did they not say to Europe, “We’re taking back sovereignty and control of SPS in Northern Ireland.”? That is not what the reset does; it retains EU sovereignty of SPS in Northern Ireland, and then makes a separate deal for GB. We are on the road to dismantling this Union, courtesy of this protocol—and that is why, as a Unionist, I will always hold out against it.
We are not just discussing inconveniences; these barriers are a chokehold on progress, strangling the local businesses that drive our economic growth. Moreover, these trade barriers threaten consumer welfare. Market constraints lead to limited choices, empty shelves and rising prices. British families in Northern Ireland face restricted access to diverse goods and are suffering unnecessarily. That is not the future that we envisioned for UK citizens. We cannot accept a future market that is marked by economic hardship due to artificial barriers within our United Kingdom.
These trade barriers challenge the essence of what it means to be united. They drive a wedge between regions that throughout our rich history have stood shoulder to shoulder. The resulting divide contradicts the very principle upon which the UK was built. It must not fracture our shared identity and values. While the intentions behind the protocol may have been good, the reality necessitates a reassessment of its impacts. I am reminded of the saying that the road to hell is paved with good intentions. Solutions exist and we must pursue them. The bottom line for any resolution must be the integrity of the UK and its internal market. Let us not be passive in the face of these trade barriers; instead, we must be diligent in restoring seamless trade throughout the United Kingdom.
Finally, Minister, given that these trade barriers are part of some 300 EU laws with zero democratic accountability in Northern Ireland, what is the timescale for their removal? We were told that we would get the best of both worlds; that is just not the case. When will this get sorted out?
Even major retailers are pushing back. We will hear about all those businesses and companies that make it work, but in June Stuart Machin, the chief executive of Marks & Spencer, called the implementation of these labels
“bureaucratic madness, confusing for customers, and completely unnecessary given the UK has some of the highest food standards in the world.”
If the chief executive officer of one of the UK’s most established food retailers finds the system hugely bureaucratic, says it is
“adding yet another layer of unnecessary costs and red tape”,
how can we expect small firms, often with just a handful of staff, to cope?
I am sure that the Minister will talk about the coming SPS deal, which has been mentioned, but the real challenge that the Government have to answer is: why are they continuing to introduce further bureaucracy and further checks? If this promised deal—this new relationship with the EU—is so positive, so genuine, and if we are so much in partnership, why do we have to introduce this? Why can we not put in place the extended grace periods we have often seen in the past for those businesses and organisations?
The FSB’s work on the framework was undertaken before there were further restrictions—before the restrictions on business-to-business parcels came into force on 1 May, and before the phase 3 labelling requirements on SPS products came into force on 1 July and from 1 September. Small businesses are asking us to establish something that actually helps. A back office, knowledgeable and with expertise, should be made available through an accessible, business-friendly route, rather than this bureaucracy. Dr Huq, I respect your time limits and will allow another hon. Member to speak.
The hon. Member for North Down (Alex Easton) referred to dog treats: cheaper companies will not pay the vet fees to go through the shipments line by line. I heard Roger Pollen, from the Federation of Small Businesses, doing an interview at the end of June, in which he highlighted that 1,000 Marks & Sparks products have to be re-labelled, and 400 M&S items have been moved into the red lane—all that when Government had promised us that things would get easier, instead of getting worse. When M&S is struggling with the complexity, why would small retailers such as Morris & Son Ltd waste time and money? The fact is they will not, they are not, and my constituents are the losers. We were promised the rewards of a dual market, yet there has been no drive to entice business to come in and make the most of that supposed draw. The reason is that no one can actually quantify what the benefits are, and how we can assess them.
The Minister is a good man. We all know that. He always tries to be helpful. We have posed a lot of questions, and hopefully he can give us some answers. I urge him to go to the Cabinet to arrange a meeting with the EU to end this nonsense once and for all. Small businesses are crying out, and it is now affecting big business, which is where it gets even more difficult, but what is worst of all is that my constituents and all the other Northern Ireland constituents are paying more for their products than people on the mainland, and wondering why they are paying the price for Europe to maintain its death grip. End that death grip, Minister. Make the changes and end it soon, before small businesses are choked to death.
Let me spell that out with real examples. A forestry business in my constituency urgently needed machine parts. They were delayed coming from Scotland via next-day delivery, leaving workers idle and costly machines unused. A children’s boutique was hit with a £205 duty and VAT invoice for delivery of goods from GB. We have also seen used agricultural machinery, visually clean and only road driven —immaculate—being turned away at our ports unless scrubbed to EU standards and accompanied by a phytosanitary certificate. One dealer has had to comply with four separate pieces of paperwork just to move a single tractor. Meanwhile, GB and Republic of Ireland dealers face none of that. An engineering firm supporting major Northern Ireland manufacturers said that its key selling point was rapid response. It is now impossible to say that, because of the delays and trade barriers.
In addition, we now have the blow to animal health. From January 2026, the Government are prepared to implement EU law in full on veterinary medicines, shutting out GB-based suppliers unless they jump through impossible hoops. Pet shops, farmers and even charities are now in the firing line.
This is death by a thousand cuts, and the Government are not even pretending to stop the bleeding. GB firms now say that it is easier to export to Japan than to Northern Ireland. The reality is that we have farmers who cannot move livestock; horticulturists who cannot bring in trees and seed potatoes; and families who no longer get parcels from GB retailers, because more than 90 major suppliers no longer deliver to Northern Ireland. There is every reason to act, the two main ones being that there are now economic implications, as per the FSB report, and there is clear diversion of trade. It is time for the Government to step up and act on behalf of the people of Northern Ireland and the businesses that are impacted.