Official Report: Minutes of Evidence

The Chairperson (Mr McGrath): I welcome Fergal O'Brien, director of policy and public affairs at the Irish Business and Employers Confederation (Ibec); Angela McGowan, director of the Confederation of British Industry (CBI) Northern Ireland; and Michael D'Arcy, the programme lead between the two organisations in the Joint Business Council (JBC). We thank you for attending.

Brexit matters have been dominating a lot of the Committee's work over the past year. We regularly engage with sectors to get updates on what is happening and a sense of what is taking place on the ground, so we really appreciate your coming together.

The format is that we will fire over to you to say a few words and give us an introduction, and then we will move to a question-and-answer session with members.

Ms Angela McGowan (Confederation of British Industry NI): Thank you, Chair. I will lead with the introductory remarks, and Fergal and Michael will follow me.

I am the regional director of the CBI in Northern Ireland. The CBI is the UK's leading business organisation. We speak for about 190,000 businesses across the UK, whose employees represent about one third of the private sector. It comprises a full spectrum of business interests by sector and size. In Northern Ireland, we represent 75% of the top 100 companies.

We very much welcome the opportunity to address the Committee on this issue and your willingness to engage on it. Around 90 days into the new arrangements, CBI members report that trade has been moving reasonably well and that they are increasingly getting to grips with the new administrative requirements.

The CBI knows that the protocol is not perfect, but it is a dynamic framework that the business community wants to bed down and to secure so that we can have peace and prosperity on the island. We know that it is needed to uphold the trade and cooperation agreement (TCA) for the whole of the UK as well.

The upshot of maintaining largely barrier-free trade across the island of Ireland is that it has already delivered economic benefits. Data from January shows that Republic of Ireland imports from Northern Ireland were up 10%, and exports to Northern Ireland were up 17%. Ultimately, Britain is Northern Ireland's largest trading market, so getting unfettered access to the market has been hugely important to us. However, getting to grips with the at-risk test, the rules of origin and the customs administration has not all been plain sailing for Northern Ireland businesses. The new arrangements are much better than a disorderly withdrawal from the EU would have been, but we need to find solutions urgently to the well-documented challenges and barriers to trade from Britain.

In August last year, the CBI set up a weekly protocol working group, which is made up of about 20 senior executives from a range of industries that trade with GB, between GB and Northern Ireland, and between Northern Ireland and Europe. That working group has provided us with real-time insights from members and has been instrumental to the CBI's understanding of the operational challenges that firms face when trading under the protocol. It is the CBI's view that, since January, trade has flowed relatively well for Northern Ireland firms from Northern Ireland to GB, but there have been problems, especially in January, with trade flowing from GB to Northern Ireland. Trade flows in quarter 1 must be caveated with reference to the wider trading environment in which companies have been exposed to global supply chain issues arising from COVID, but particular trade issues have emerged for my members around timings. There were some delays initially, particularly with inbound loads, although most of it was getting through. There were also issues with paperwork. Administration is, obviously, heavier now, particularly for products of animal origin. The complexity of the at-risk test and how it interacts with the rules-of-origin requirements under the TCA sanitary and phytosanitary (SPS) checks and certifications is an issue. The administration is very complex, and there is a shortage of vets. Trade costs are, obviously, rising. Doing business is not so smooth. The rebate scheme is definitely an issue for companies.

Notwithstanding all the challenges, the CBI has been consistent in supporting companies in how they operate under the protocol. We have supported the protocol against the alternative, which was a disorderly withdrawal from the EU. We are committed to supporting policymakers in doing all that is required to ensure that the protocol works for business in a manner that protects east-west and North/South trade.

I will pass over to Fergal.

Mr Fergal O'Brien (Irish Business and Employers Confederation): Thank you, Angela. Good afternoon, Chair and members. Many thanks for the opportunity to meet you today on what is an important and critical issue for business and the wider economy.

I am the director of policy and public affairs at Ibec. Some of you may be familiar with Ibec, others perhaps less so. Ibec is Ireland's largest business representative group. We are the largest lobbying organisation of any type in Ireland. At an EU level, we are the third-largest national representative group. We have about 250 staff who work across the areas of policy development, on which I lead, and employer, HR and workplace issues. We also have 38 trade associations. Ibec is unique in that context; all the trade associations working across different sectors of the economy are fully integrated into the one organisation. In Ibec, for example, you will find the retail sector, food and drink, medical technology, biopharma technology, financial services, property and a host of other industry groups, all working side by side for the betterment of the economy and society. That has been very useful, particularly in the context of Brexit and the challenges that that has brought.

Our member engagement on Brexit has varied across different sectors of the economy. Angela mentioned the particular challenges that the food sector has been facing. Brexit is by far the most significant policy issue that has impacted it over the past number of years. For others, such as the services sector, it has been much less dominant. However, there is no question that, for all our members and for all businesses, there has been extensive engagement on all the planning that was required in order to be as prepared as possible for what was a major change, as we see it, in the economic order that Brexit has brought about.

Very much like Angela and the CBI experience, I would say that, by and large, our members are working through the changes without severe disruptions, although most are now reporting a higher cost of doing business as a result of those regulatory and administrative changes and, in particular, the supply chain alterations, which have been material. The levels of disruption now, as we come to the end of quarter 1, are nowhere near as severe as they were in January — that is for sure. Many of those initial teething problems have been overcome. However, we continue to hear from our members that the movement of goods on and off the island has become much more complex and, crucially, costly. Many businesses fear that that will be a long-term increase in the cost of doing business.

The export companies that are Ibec members are definitely relieved that the new GB border operating model requirements, which were due to come into operation in April and July, have been postponed with a further grace period. Many had feared that further disruption to trade flows would be brought about, and we were quite concerned about capacity issues as well as animal health issues and associated checks. Ibec has always supported a meaningful transition period in the Brexit process, and it has been a source of frustration for our members that business was ultimately left with so little time to plan and prepare for what were very significant changes.

I will make some comments on how supply chains have been working across the island of Ireland from our members' experiences. Those that have integrated supply chains are reporting that they continue to work effectively, but, again, their business operations have not been without their challenges. A number of our members, particularly in the food and related sectors, are reporting that the treatment of Northern Ireland-origin inputs are a particular challenge in relation not only to external EU trade deals but to other EU issues. That definitely remains an ongoing challenge for our members, and we are very aware of engaging on that with our Government.

Overall, to conclude, it is very clear to us that, despite the significant twin challenges of Brexit and COVID, the Irish economy continues to grow. It grew last year and it will grow again in 2021. However, that economic performance is very much what we call K-shaped: some sectors of our economy are performing very strongly while others, unfortunately, remain in shutdown right now. Overall, we are looking to the post-COVID world with confidence, given the underlying strength that we see in business and in our business model. In particular, we are urging policymakers to be ambitious in investment for economic recovery. We see particular opportunities to progress ambitious connectivity and investment programmes that will benefit the entire island of Ireland.

I will leave my opening remarks there for now and pass over to my colleague Michael D'Arcy.

Mr Michael D'Arcy (Ibec-CBI Northern Ireland Joint Business Council): Good afternoon, everybody. I join Angela and Fergal in thanking you for the opportunity to address the Committee this afternoon. I am the programme lead for the Ibec-CBI Joint Business Council. I have been involved in researching and considering North/South economic and business interactions since the early 1990s. In the context of your previous discussion, I am not sure whether that puts me in the younger or older age cohort or, perhaps, somewhere in the middle. Now that the UK has left the EU, this is a welcome and important conversation on the implications for business of the resulting new North/South dynamic and, indeed, on implementing the Northern Ireland/Ireland protocol.

I will give you a little bit of background on the JBC. It has been around for five decades, and, in that time, it has facilitated business leaders in both jurisdictions to jointly promote strategic investment to support the growth of business employment across the entire island. The focus of its work is to identify and promote opportunities for mutual benefit: the key words there are mutual benefit. CBI and Ibec members first met to discuss those opportunities, along with their shared concerns, in the early 1970s. Indeed, we have the minutes of that first meeting and it might surprise you — maybe not — to know that the three top agenda items were improving the transport infrastructure, dealing with the illegal movement of steel, which was distorting the market, and the opportunities that were going to be created by the UK and the Republic being in the then EEC.

In the five decades since then, the JBC has constructively informed and supported the development of joined-up North/South infrastructure, and it is important that it encompasses soft as well as hard elements that are needed by business — not just transport and spatial planning, for example, but skills and research and development. In the early 1990s, the JBC responded to the new opportunities that had been created through the single European market by providing evidence. It has always been critical to the JBC's approach that, following the paramilitary ceasefires and the Belfast/Good Friday Agreement, there were North/South opportunities of mutual benefit. I say that because, at that stage, there was a lot of doubt and concern that there was not a case for doing more trade and business across this island's border. Indeed, at that time, trade and business across this island's border were the lowest in the then EEC. This opportunity was first envisaged by Sir George Quigley's seminal proposal for an island economy and the Belfast-Dublin economic corridor, which was, coincidentally, rebooted this morning jointly by Belfast City Council and Dublin City Council, along with all the local authorities along the east coast. I think that that is a very interesting revival of a long-standing idea that has a lot further to go. More recently, the JBC has produced a number of original reports, such as 'Business on a Connected Island', which conclusively shows that Ireland and Northern Ireland have benefited economically from peace, stability and an invisible border for goods, services, labour and finance. Our annual Business on a Connected Island conference has presented case studies from a wide range of companies on the all-island economy's operational benefits for their business. The focus has always been on the practical and functional dimensions where they work for business. In addition to that, our rather visionary 'Connected' report in the middle of the last decade proposed a completion of the island's core transport network to match the needs of a prosperous population of 10 million people in the coming decades.

Of course, Brexit has brought about changes that are having a universal impact across business and society, and, during 2020, COVID has added to that and accelerated destructive trends. However, greater opportunities now being presented, such as climate change actions. Yesterday, as you are probably aware, the Government of the Republic announced their considerably more ambitious and determined plans in the climate action area. The experience of all-island businesses is that tackling these challenges will benefit from the shared prioritisation, development and delivery of a more ambitious, long-term, strategic and shared island investment programme. Therefore, having consulted with CBI and Ibec members on this new environment for business, the JBC has identified the following immediate North/South opportunities for that shared investment programme. The first is through supporting existing business operations that operate on an all-island basis. Secondly, there is the development of the all-island labour market and, of course, there are many more opportunities in a COVID environment with people working remotely etc. Thirdly, investing in skills, education and innovation is essential for the recovery of both economies. Fourthly, ramping up physical infrastructure investment because, while there are a number of projects to be completed, there are new projects to be identified and pursued.

A more dynamic approach is urgently required on a number of strategic cross-cutting policy decisions and actions that are core to leveraging these opportunities successfully. Obviously, and most importantly, the shared climate change goals are the number one priority for every Government in every jurisdiction, and that is across all sectors. The second priority is about stronger institutional engagement, and we welcome the revival of the North/South Ministerial Council in that context and that work beginning again. We would like to see that on an east-west basis in the context of the British-Irish Council. Finally, there is more effective communication, which comes across with more positive dimensions of how constructively business and the economy are contributing to the prosperity and peace of this island on both sides of the border.

The Chairperson (Mr McGrath): Thank you very much indeed for that. That has given us a real flavour for the work that you are doing and the challenges that you are undoubtedly facing in the current time. It is not so different from that first meeting 50 years ago; maybe there is a different emphasis, but similar problems are being faced. For organisations such as the CBI, Ibec and the JBC, finding solutions to those problems is the most constructive and helpful thing. It is incumbent on the Governments in London and Dublin, and the Executive in Belfast, to do what they can to help to find those solutions, albeit it may just be about identifying the problems. However, once you have identified the problems, you can certainly try to overcome them.

You mentioned the transition period. It felt as though the transition period was not a transition period but rather a space within which people tried to find out what the new circumstances would be. Then, all of a sudden, new arrangements were brought in from 1 January. It is as though the transition period is now. There have been some sounds, certainly, that trade from Northern Ireland to GB is happening and getting up to a reasonable level but that there are problems with trade coming from GB to NI. By extension, is it your experience that the Dublin to GB route is working OK? Are there difficulties there? We need to keep reminding the London Government that they need to work with businesses in GB to ensure that they are at the right level to interact with the protocol in order to get items over to Northern Ireland and Dublin. Have you any thoughts or views based on your experiences on the ground in the first few months?

Mr O'Brien: Angela, will I let you go first?

Ms McGowan: Yes, I will go first, and then I will let you come in on British to ROI trade, Fergal, if that would work. We are seeing that things have been relatively smoothed out. We do not have issues with goods going from Northern Ireland to GB, but we have some difficulty, as I mentioned, with goods coming from GB to Northern Ireland. That said, we have had communications on that and meetings with the UK Government. Work has been done — they are still working on it in the background — for companies in GB to understand the administration and documentation that they need to fill out in order to trade with Northern Ireland. Since January, that has improved. More and more companies are coming online.

That said, there are still things that the UK Government have to do — for example, simplifying and clarifying the guidance around rules of origin and expediting the rebate scheme that companies would like to use. All that will help. The Trader Support Service (TSS) has been very useful. We have had good feedback from members. However, we would like to see a bit more simplicity around data entry. Members have talked about that. More could be done. It will take time, but we need that collaborative approach from the Government to work with business and the EU side to make it happen in a smoother fashion.

Mr O'Brien: Thanks, Angela. It definitely landed on us at the last minute in the days before Christmas. I had been hoping for a sleep-in on Christmas Eve. That did not happen. It was the same for businesses. Despite the fact that many of the new arrangements may have been signposted in advance, until we had an agreement and certainty that tariffs would not be part of the trade and cooperation agreement, businesses were not able to plan fully.

From an Irish business perspective, we were absolutely frustrated that we ended up in a situation in which we did not have a meaningful transition period. It made it very difficult for businesses to be fully prepared, despite all the engagement that we had with them and the work that state agencies in the UK and Ireland had done. Lots of businesses were still not where they should have been, but we cannot look beyond the last-minute nature of the agreement and the disruption that that caused. January was difficult. When we look now at the flows between GB and Dublin, and Ireland more widely, we see that a lot of companies have changed their supply chains. The initial trade data for January and February shows that it is down substantially from what it would have been a year earlier. We must not underestimate the complexity of how the supply chain logistics system works with regard to companies using the land bridge from the Continent through GB — working with other suppliers, picking up occasional pallets and bringing them here for SMEs across the economy. All that has been disrupted. Unfortunately, again, we need to see that level out a little as we go through some of those teething problems. However, it looks to us as though it will result in permanent supply chain disruption between GB and the Republic.

That is unfortunate. We really want to see strong cooperation North/South and east-west to support all our economies, but we are seeing our members struggling with disruptions and facing higher costs. They have lost so much of the agility in their supply chains because being able to hop across the Irish Sea in a very timely and efficient way was very good for business. Trying to manage supply chains now, where we have an uncertain land bridge and working directly with the continent, has been very disruptive. Some of the teething problems have been overcome, but we see significant long-term higher costs of doing business and, ultimately, disrupted supply chains, which we think are bad for the Irish and wider UK/GB and NI economies.

Ms McGowan: I agree with Fergal. It was a very abrupt start to the year. The eleventh-hour deal did not help. Larger firms were wise to what they had to do, but they still had to employ a lot of teams to come in over Christmas to try to be ready. Many of them bought things in advance to reduce the issues with delays etc. The grace periods have helped, but what we need now mostly is for the UK and the EU to agree the grace periods and use the time wisely when we get them to find long-term solutions.

The Chairperson (Mr McGrath): It is a complex problem and a complex set of logistics that need to be worked around, but while there will be no silver bullet, I have heard some sectors, such as Retail NI, for example, say that if agreement could be reached on SPS checks, that would remove a substantial amount of the paperwork and the issues and problems and would allow trade to flow a lot more easily. Would that be useful? Should we pursue that?

Ms McGowan: Northern Ireland' economy is very agri-food based, so this has been a significant burden and has caused a lot of the delays. There have been problems with the number of vets etc, so a UK/EU veterinary agreement might be the solution.

The Chairperson (Mr McGrath): Fergal, how would that impact in Dublin?

Mr O'Brien: Our members are struggling with many of the same issues. They were very concerned in particular when the new requirements for selling into GB came into place on 1 April. I agree with Angela that we need to use the time ahead to be much better prepared to support seamless trade. Obviously, we will have our commitments to single internal markets. There are significant requirements for our industry, and it needs to comply with them, but we want to see cooperation being enhanced between the UK and the EU because some of the challenges in the early part of the year were very disruptive.

The Chairperson (Mr McGrath): I will open up to members for questions.

Ms Anderson: Thank you all for the information and for the presentation. You talked about the difficulties that you are having with goods and produce coming from Britain into the North and, indeed, across the island, but, as you will know, it is not only Britain, the North and across the island where there are difficulties. There are problems with moving agri-food goods from Britain to the EU, to Portugal, Germany, Croatia and across the island. There is no protocol, as we know, in the English Channel. So, the problem is clearly Brexit.

I do not know whether you heard about the trader in Britain who, having campaigned for Brexit, found, to his horror, that there were 38 pages of paperwork involved when he tried to export to France from England, costing over £500 per shipment. That is someone who did not realise the consequences of Brexit, which has been an unmitigated disaster.

You touched on it there, Angela, in relation to the grace period. Whether or not there are any further agreements between the British Government and the EU, you know — we all know — that the EU has clearly called it out that the British Government have breached an international agreement.

What kind of preparations are businesses making to prepare for what was agreed in December? I would prefer that we had not been dragged out of the EU, but since we have been, and there are consequences of Brexit, are businesses preparing for the end of the grace period? Or are they waiting in hope that the EU and the British Government may come to another agreement? We know that the EU has already said that the British Government have breached an international agreement.

Ms McGowan: We come at this from the perspective that solutions can be found to the barriers that we see at the moment. We think that there are possibilities for getting agreements on all the issues, but what we really need is for the UK Government and the EU to go into a room, sit down and work out the solutions. They can be found — if the political will is there. However, there is no doubt about it: there have been quite a few hiccups. It has been a far from easy journey, and I think that cooperation between the UK and the EU will be needed to get there. For us, as I say, it is about extending the grace periods. Business expects the UK Government and the EU to use the grace periods to come up with long-lasting solutions that will work into the longer term.

Ms Anderson: I would like that to be an outcome, and I share your view about an agreed grace period. In fact, we had asked for the transition period to be extended. That is exactly what the grace period was about, but that was rejected by the British Government.

Given that businesses say that uncertainty is bad and the British Government are acting unilaterally. The British Government and the EU went into a room, and, in a room, they made an agreement — the withdrawal agreement. Then, amid the disorderly withdrawal from the EU, we had the cooperation agreement.

Business is clear about the difficulties of operating within an uncertain climate. What are businesses doing to engage with the British Government and the EU? It has been a very difficult period for you, but I know that the EU listens to businesses, as it did throughout the period of the withdrawal agreement. This is in relation to you all.

Michael, you touched on services. As we know, services are not included in the withdrawal agreement. Have any difficulties emerged from that, or is it too early at this stage? Is there something that you envisage happening as a consequence of services not being in the withdrawal agreement?

Ms McGowan: Maybe, Martina, I will come in first and tell you what businesses are doing and who they are talking to. We are having very good engagement with the Government. We have fortnightly meetings with HMRC. We regularly meet the Trader Support Service; representatives have been to our working group twice. They are always available when we want to catch up with them on issues. We have monthly meetings with the Welsh Government about the Dublin to Holyhead route. We meet the Irish Department of Foreign Affairs and met Simon Coveney in February. We are part of the Business Brexit Task Force, and when there is a particular Northern Ireland dimension to that, we bring it up. We work with the Northern Ireland Office on a regular basis, feeding in what the issues are, and what business sees as the solutions.

Mr Darcy: Martina, thank you for your question. As you saw, the JBC likes to take the long-term strategic view. However, because of the difficulties that have been encountered in the short term with the trade movements — there are practical solutions to those — the wider dimensions of the protocol, unfortunately, still have not really been looked at. There is a lot more in it. Even though the movement of goods part is the important one, there is a lot more in it than that. As you will all appreciate, there is the question of the common travel area, and it clearly has been very important to retain that for the

movement of people on the island. That is also relevant to your question about services. There are people who deliver services rather than goods, so having the common travel area underpins the continuation of an all-island labour market, whether in the geographic north-west, the Dublin to Belfast corridor or wherever else. That is a very important piece.

There is also the question of article 11, which maintains the conditions for continued North/South cooperation. A whole list of areas came out of the mapping exercise that was done by the EU and the UK, which identified either over 160 or 140 areas. There seems to be disagreement about that, like so much else.

It is interesting that you mention the protocol because, in it, we have key elements of infrastructure and supports North/South for, for example, the electricity market, which is still in place and provides an important service. Climate change, the environment and skills are all covered there as well. All those areas are, perhaps, what you are asking a question about that we do not really know the answer to. As Fergal identified, regulation continues to be aligned North and South, and there is relatively little disruption that we have evidence of to the provision of services. Therefore, it is a question of, over time, the degree to which that alignment continues to be in place to support the continuation of that action and cooperation and the businesses that underpin and carry out North/South business.

Ms Anderson: Michael, before Fergal maybe comes in, will you comment on the all-Ireland supply chain? You can see that it has been strengthened North to South and South to North. Exports of beef from Britain to Europe are down 95%, exports of salmon are down 92%, exports of pork are down 86%, and so it goes on. It is significant that overall exports from Britain to Europe are down nearly 50%. When you talk about the work that is going on in the 156 areas — as you said, it is closer to 160 areas — of all-Ireland cooperation and alignment, can you see that alignment strengthening? You mentioned the economy, as, I think, did Fergal, and that people are now looking elsewhere for supply chains. Businesses will always find a solution, and I can see businesses looking a the all-Ireland supply chain as one of those solutions.

Mr Darcy: Before I hand over to Fergal, who has the hands-on information for dairy, beef and other sectors — the actual numbers — I will broaden the debate initially and highlight that the biggest winners from North/South cooperation and the all-Ireland economy are SMEs. InterTradeIreland has identified 7,000 SMEs that operate on a cross-border basis, many as sub-suppliers to larger business. Again, it is important not to lose sight of their concerns and their needs. That is something that local authorities could look at, as well as the Executive and the local enterprise development agencies. It is important that that is not lost either.

We are optimistic about the opportunities for two reasons. The first is that it is essential for COVID recovery. The economy is under pressure, it needs all the elements of potential support for employment, and it needs to work as effectively as possible to get to whatever the new normality will be. Frankly, to be honest, not being ambitious is not an option, in whatever context. Secondly, as you said, business has the capacity to find a way round difficulties and, ultimately, economics should, we hope, win out. The all-island economy is premised on economies of scale and proximity. It is an island, we are close to each other, and that makes it easy for SMEs especially to work closely and underpin the operations of large businesses.

If I may digress for a minute, because, in my mind, there are not enough practical examples. We want tourism to recover. For example, if I am running a business to attract wealthy Americans to play golf on the island, I want to be able to access all the major golf courses on the island, not just one. If I am producing milk, why do I want to sell to Baileys Irish Cream? If it is selling more product in the international market place, I have another option for my product. There are lots of practical examples that are not sufficiently highlighted at the moment. Let us get beyond the difficulties and look at the immediate and practical benefits.

Ms Anderson: Michael, from what you are saying, the highest share of our economy in the North is made up of SMEs, and the majority of people who work in the North work in SMEs. Over 80% of them operate on an all-Ireland basis. So, you are right. Attention has focused on the difficulties, and, obviously, they need attention. Sterling work is going on with SMEs and others operating on an all-Ireland basis. Of course, as an Irish republican, that is why I would like to see this country reunited, but that is a conversation for another day.

Ms McGowan: Martina, before we go to Fergal, I just want to say that it is important to remember that the supply chains across the island are deeply integrated with those in GB and Europe and depend heavily on them. Interrupting them does no one any favours. Getting trade flowing between these islands and Europe, with the least possible disruption, is the ultimate goal for us.

Ms Anderson: We all said that, unfortunately, there would be consequences of Brexit. It is an unmitigated disaster. Hopefully, we can get some of the wrinkles ironed out.

Mr O'Brien: Thanks very much, Martina. There is just so much disruption at the moment. One of the things that we probably underestimated is the collision factor between COVID and Brexit. Sometimes, it is hard to disentangle what was COVID and what was Brexit, as they have come together with significant impact.

However, as Michael said, beyond this, I see a lot of opportunities. We have listened to feedback from our members over recent weeks and months as they reflected on this. Interestingly, about 15 years ago, the consumer market in the Republic was very much a stand-alone supply chain framework. When the last crisis hit, that shifted to a just-in-time model out of a GB-based warehouse-type structure for an awful lot of consumer businesses. For various reasons, that is being looked at again, so there is an awful lot of flux at the moment.

As Angela said, it is important that the east-west supply chains are working for us; otherwise, the cost of doing business will go through the roof. That is a real fear. In that flux, there will be an opportunity for SMEs in Northern Ireland to supply more customers in the Republic. That opportunity will definitely emerge. We are continuing to see some of the realignment of that supply chain structure. How major global corporates are supplying the Irish consumer market is changing. Unfortunately, we may move away from some of that model that was very much just in time from GB.

That is a consumer distribution model. Of course, there are jobs and economic activity in it. We want to see that added opportunity in our all-island economy in skills sharing, innovation sharing, supply chains and businesses working with one another and competing globally.

Michael mentioned some of the opportunities that, as an island, we can compete for and win globally. It is interesting to watch the developments in the UK on corporate tax increases. We will see the same across the world. Tax will become much less of a competitive issue. The things that will help us to win, as cooperating economies and cooperating business communities, will be investment in our infrastructure, talent, skills and innovation. On both sides of the island, we are struggling on some of those right now. We want to see ambitious investment coming through because there is so much opportunity there.

The Chairperson (Mr McGrath): Thank you for those interesting answers and for giving us a flavour of the opportunities, as well as the problems. Do any other members wish to ask a question? No. That is grand. We strayed towards what the Economy Committee should be investigating and discussing with you, but it underpins some of the work that we have been doing, from a scrutinising perspective, with the Executive Office.

As I say, there are a lot more interesting conversations to come about how we can join together.

Ms Sheerin: Angela, Fergal and Michael, thank you for the presentation. We know that the upshots of Brexit have not really presented themselves in totality yet. As you said in your presentation, it has coincided with COVID so it is hard to identify which difficulties have been caused by COVID, which have been caused by Brexit, and which are the implications of the protocol. It has been difficult to untangle them. I am also conscious that there are things that are being put on the long finger because of COVID, the restrictions and the fact that people are not moving about as much.

I have a query about businesses. What has been the feedback from employers on employees' rights and things that are being impacted on by our leaving the EU? I am thinking of difficulties that have yet to be ironed out or which may not even have presented themselves in totality yet, such as the frontier scheme and the EU settlement scheme. Are employers raising the issue of people from other countries working here and crossing the border? I have spoken to employers in my constituency who have employees from other European countries. Those employers are not sure whether to raise it with their employees or whether to advise them to fill in an application, given that that closes in the summertime. Has there been any feedback on that?

Ms McGowan: I will say a few words on that. There have been a few enquiries, although not a lot, from companies that have concerns about how they will move people in teams across the island. Many of the big consultancy houses, accountancy companies and law firms have all-island businesses and move teams around. Many of those teams have EU citizens in them. There have been some queries about how they move EU citizens across the island and what is involved in that. Of course, since Brexit, there has been increased difficulty, not just for companies in Northern Ireland, with the visa process and the extra administration and costs involved in attracting international workers.

Another thing that is raised is the mutual recognition of professional qualifications. Before, the UK and Irish Governments each acknowledged professional qualifications as an essential facilitator to the right to work in both jurisdictions. However, the trading cooperation agreement does not support the continuation of that between the EU and the UK. Therefore, the pathway in recognition is now regulator to regulator. It is quite similar to what Japan and Canada had thought about, but neither of those has actually produced a mutual recognition agreement to date. We are very keen to see the UK and Irish Governments working hard to encourage such arrangements. However, what is best is probably the support to develop an overarching reciprocal framework agreed between the UK and Ireland that allows for professional qualifications to be recognised. That would benefit so many professions and give them a clear and consistent route to recognition across the common travel area.

Mr O'Brien: I will make a very brief comment on the frontier workers' issue, which is definitely coming up more with our members. There are issues with taxation and other aspects that we are working with our Government on to address. That has definitely become more of a challenge. As I said, with the disentangling of Brexit, COVID and the future of work, we will see a very different business model operating for where our employees live and work. That will bring opportunities. It will definitely bring some good employment opportunities in different parts of the island. However, we need to make sure that there are frameworks to support it. We are very conscious that there are challenges right now.

The Chairperson (Mr McGrath): Michael, Fergal and Angela, thank you very much indeed. It has been a busy year for you with Brexit and COVID. We certainly appreciate your work, and your contributions to the Committee today. Thank you very much indeed, and, hopefully, we will encounter you again.

Yes, come on ahead, Christopher.

Mr Stalford: Sorry, Mr Chairman, but several comments were made, and it is important to respond to them rather than directly asking a question.

The Chairperson (Mr McGrath): OK, go on ahead.

Mr Stalford: I find it incredible — incredible — that any Member of the Northern Ireland Assembly would continue to defend a situation where, the Chief Veterinary Officer tells us, 20% of the entirety of SPS checks conducted by the European Union are carried out between GB and NI. That is totally disproportionate, and no one could possibly defend it.

The answer to the question of uncertainty on these issues is not to make sure and certain that people's lives will continue to be difficult. I just want to place that on record, as well as my total opposition to the protocol, which needs to be replaced. Thank you.

The Chairperson (Mr McGrath): OK, thank you for that, Christopher. Anything else, members? Then I will definitely conclude by thanking our guests for coming along.