This is based on  the Hansard version of my speech in Grand Committee on the issues of Northern Ireland and the EU re set. As always I spoke without notes or text. I have changed the punctuation and shortened some of the sentences from the Hansard version to turn it into written prose.

My Lords, I intervene in this debate not as a Northern Ireland specialist or representative, which I am clearly not, but as someone who has taken a strong special interest over many years in the economy and economic growth, and in the trading patterns of our great United Kingdom. I am not surprised that much of the debate so far has been about these economic issues. We have heard eloquent testimony to the barriers and difficulties that small businesses in particular but also some big businesses are experiencing as a result of the dreadful settlement of the so-called Northern Ireland problem, embedded first in the protocol and subsequently in the Windsor Framework.

I fully support what my noble friend Lord Lilley said and will explain to the Committee that my noble friend and I, and other Conservative MPs and Peers, held regular meetings over the Brexit years to discuss how our country can get the most out of the freedoms we can enjoy . We set out how we  could develop now that we have left the European Union, and how the £17 billion we are now saving in annual contributions can be best spent to our wider benefit and related issues. We have often, as a result, had joint meetings or exchanges of MPs and Peers with our Unionist colleagues here today.

In our meetings, we took on board that Northern Ireland had a particularly bad deal out of the form of Brexit entry that the EU cajoled or persuaded successive British Governments into accepting. There is no doubt that absorbing so much European Union law into Northern Ireland is a constraint on growth, on small businesses and on trade. I urge the Government to think carefully about this, because they wish to align the whole United Kingdom with more of these laws, charges and impositions. Yet it is the case that where it is being tried in Northern Ireland, far from being a golden scenario, as some suggested, it is clearly a negative that is causing trouble.

In a previous speech in the Chamber of the House of Lords, I set out my own research findings for the period 1952 to 2020—from 20 years before we entered the EEC, from the 20 years in the EEC customs union from 1972 to 1992, and from the 28 years in the single market from 1992. The data is overwhelmingly convincing that the closer the alignment—the more European law, costs and taxes we absorbed—the slower we grew.

I fully accept that there were other factors affecting our growth rates over those long periods, but you cannot reach a conclusion from the data that there was ever a time when aligning more closely helped and gave us a boost. There was no boost when we joined the customs union. On the contrary, because a lot of our industry was not fully competitive and was being protected by tariffs, when the tariffs came off, the Labour Government had to face big problems. We  saw mass closures and destruction of large parts of our industry because Italian, German and French textile companies, steel mills, engineering works and vehicle makers were so much more efficient than our own. The shock was too much.

 

There was also no visible extra growth—indeed, quite a lot to the contrary—after 1992, when the EU had completed its so-called single market. This  was actually a major power grab and a whole series of laws that were often negative to the conduct of business. Again, there was no sudden improvement or growth in our economy. In many ways, the problems got worse after the single market had been completed. Of course, it was completely misleading to say that the single market was completed in 1992 because, for the following 28 years of our membership, there were ever more laws, ever more rules, ever more charges and ever more taxes, which had a direct impact on British businesses and clearly did no good.

Northern Ireland is right to say that there are two problems with the settlement we have been persuaded or forced into by the European Union. There is the problem of economic growth, prosperity, and business and trade success, but there is also the fundamental democratic accountability problem, which is a direct result of the EU’s chosen solution of putting Northern Ireland under European Union rules.

The report is wonderfully written. When I first came to it, I found it quite heavy going, complicated and difficult. Then I  realised that, in a way, that was a wonderful parody of the issues that the report had to deal with. The authors of the report clearly understood it perfectly well and were showing, by the way they described it, what a dreadful mess there was: just how many contradictions and complexities were built into it, all to the advantage of the EU and not to the United Kingdom or Northern Ireland. I pay great tribute to the committee and to the work done.

The noble Lord, Lord Carlile, pointed out the wonderful organogram, which was meant to be a simplification so that those of us who found it hard going could see a picture. It tells you all you need to know. The thing is quite unworkable, completely incomprehensible and, by any external judgment, completely mad. No sensible country would ever behave like that or have accepted it, yet this is where we have got to by having all these agents and institutions involved in negotiating.

The solution offered by my noble friend Lord Lilley was  hammered out as it was with a lot of colleagues. We had the benefit of two expert lawyers in this field, who very kindly worked pro bono for us because they felt, as we did, that things needed to change in a radical direction for the benefit of Northern Ireland. This proposal would,of course, resolve the issue of  democratic accountability. If, either by agreement or unilaterally, we no longer have to impose European Union laws on Northern Ireland, then the democratic accountability problem vanishes.

 

However, we are rightly told in the report that an attempt to resolve the problem was the partial solution of saying that, if a law is really so bad that Northern Ireland cannot put up with it, then Northern Ireland should have the right, through the Stormont procedure, to say that it will not apply in Northern Ireland—an override. That does not get you around the table to influence and vote on all the other laws that you can put up with—so it is not a full answer to democratic accountability. It  is a very good partial answer, because not only would you be able to strike out anything that was really bad but the fact that you had that power would start to influence European Union opinion and attitudes, so that when representations were made on other matters, the European Union would have to bear in mind that you could just decide that it was all too much.

This takes me back down memory lane, which I am normally reluctant about, but on this occasion it is relevant. I remember, as a very young man, that when the 1975 referendum occurred and the British people voted to stay in the European Economic Community, we were assured by the then Labour Government and by the Conservative and Lib Dem opposition parties that our sovereignty would not be taken away or damaged in any way. We were joining a trading arrangement; it was a free trade area, and they called it the common market—they would not even call it the EEC. I made the mistake of reading the treaties and felt that this was an unlikely explanation of what was going on. (meaning  I voted against staying in)

When I found myself, some years later, as Single Market Minister, I remembered that we had been told that no sovereignty had been lost. My  job was a visible demonstration that a huge amount of sovereignty had been lost, because I had to spend all my time trying to construct alliances with member states to stop a law being imposed on our country that did not make any sense or could even be positively damaging. I remembered that, over the years, in an attempt to persuade us that we had not been cheated over sovereignty, something had been developed called an emergency brake—language rather similar to the Stormont brake.

Faced with this avalanche of draft laws that I did not want or wanted to change dramatically, and recognising how much work it was to construct an alliance of member states sufficient to dilute or delay in each case, I decided on one—I cannot remember which I chose now—and let it be known that I was going to use the emergency brake. This was just to show Brussels that this was all getting out of hand and that I was prepared to take action to stop its extreme legislative ideas. As soon as I mentioned this within the privacy of government, I could feel the quiver of fear and annoyance that this idea created. The great British governing establishment—the civil servants and quite a few of the Ministers—were so pro the EU having its way on everything that they thought a Minister going maverick, as they saw it, and trying to negotiate from a position of strength was a very bad idea. It was, of course, vetoed before anyone outside government ever knew about it. I conspired with the rest to make sure nobody knew about it, because I did not think it would reflect well on me that I had lost the argument to use the emergency brake, or reflect well on the Government, because they were clearly throwing away a very powerful negotiating tool that could have got us an answer that was a lot better. (The emergency brake was never used and melted away ed)

 

I give this as a salutary tale. I know that Northern Ireland bravely got a bit further than I did and once suggested that it was going to use the emergency Stormont brake. Once again, the great governing establishment knew better and decided that it was not going to be allowed to. I do not think that the Stormont brake will be used. The European Union does not think it is going to be used, which does not give you any negotiating heft as it tries to put more laws upon you.

My conclusions are this. This is advice to the Government that is heartfelt and well meant, and that would actually help the Government. I fully support the Government’s aims to have a growth strategy for the whole United Kingdom that levels up those parts that need levelling up, and is driven by more trade, industrial activity and small business developments. The Government will not get that in Northern Ireland unless they address this issue. The way to address it is to take up my noble friend’s suggestion: this is a bogus problem; there does not need to be a hard border. In the past, the big trade flows have always been east-west, or GB to Northern Ireland, not north-south, or Republic of Ireland to Northern Ireland. The big trade flows are being damaged. This has to be lifted and we have to put it to the EU. If the EU is a friendly and sensible neighbour, it will see that it makes sense. If it is not, we should do it unilaterally.

 

(The Lilley/Redwood/ERG idea was set out on this website at the time of the negotiations. It is mutual enforcement of each other’s trade rules, so anything going from GB to NI can go without new controls and do not need to follow EU rules. Anything exported from NI to Ireland will have to comply with EU rules and the UK will enforce that to avoid the need for border checks into Ireland)

The government is out to blame the oil and gas companies and the food retailers for price gouging when it is government actions and high taxes that are putting up the cost of living. High business rates for shops and a big tax rise on jobs compounds the problems. High energy prices and carbon taxes threaten many UK businesses. The failure to provide enough police to stop a tidal wave of shop lifting and violence in stores adds to the private sector misery.

I usually undertake a weekly food shop in one of three national chains with stores in my area, rotating between them to stay in touch and hear from them on how things are going. This week I went to a store which offered me £12 off £80, so I decided to restock some items that can be stored to get up to the  spend level.

I also optimised the spend by using in store shelf edge promotions. It meant I could buy around £90 of goods for £68 combining £10 of product promotions with the £12 voucher. That was a useful 24% discount which helps with the weekly budget. What a contrast with the grasping wasteful Lib Dem Council demanding 5% more of my money under threat of imprisonment for non payment. They specialise in spending on road wrecking and bad investments that annoy me greatly. My Council Tax bill along with all the other people’s bills is way above the value of what they do for the local community.

 

The state is by far and away my biggest cost as I work away to pay the soaring tax bills. They never offer a discount for early payment or for good conduct or for not using some of their services which are badly run or pointless. There is no government loyalty card.

A lot of smaller shops, restaurants and pubs are closing thank to high taxes and the squeeze on consumers. This is visible on our shrinking High Streets. So too are many of our high energy using industries. Denby’s ceramics went under this week, adding to the rout in that industry. Royal Staffordshire  and Heraldic have also gone recently and Moorcroft needed refinancing. The government  does not  care as it bulldozes its way through the private sector, blaming it for its own disasters.

 

How could I write an April fool madder than current reality?  We are living through a year of April Fool’s days.

There is the idea that we leave our own oil and gas in the ground so we can import more from abroad. That means paying tax  away to foreign governments instead of having it for ourselves. It means we export the jobs. It means more world  CO 2. A treble folly.

How about givjng Chagos away? That means paying lots of money to use something we currently own. It means letting another country damage the marine environment there that we have been protecting. Even more bizarrely it means giving the new owners money for the gift. It means helping a friend of China own a military base we and the US need to keep open the sea lanes. Another treble folly.

How about a growth strategy based on taxing jobs and businesses more? The National Insurance tax on ,jobs has led to rising unemployment, and the big increase in business rates has closed more shops, hospitality businesses and pubs. The farms tax and subsidies to switch out of growing food has led to decline of our farms. Another treble folly.

How about smashing the gangs who bring in foreign illegal migrants?  They tried doing this by repealing the Conservative law that said an illegal cannot claim asylum once here, and by cancelling the Rwanda scheme to have somewhere to send illegal migrants to. They gave large sums to France to stop the boats, only to find the French did not allow their police to go into shallow water to physically stop the boats departing. Another treble folly.

How about encouraging more people on benefits to have more children, and granting more sicknotes for life so more people can stay on benefits indefinitely? They said they wanted to control the benefits bill and get more people into work, then adopted policies which do the opposite. Their own Adviser Lord Walker asked it they are becoming the Benefits party, not the Labour party. Only in an April Fools world can a government keep on adding to the numbers and the payments to people on benefits without running out of people and companies to tax to pay for it.

 

I thought the best part of President Trump’s offer to the US people was No more foreign wars. The results of US led interventions in the Middle East in recent years have been poor with the exception of the successful liberation of Kuwait. Biden’s over hasty retreat  from Afghanistan leaving the UK and other allies in the lurch was a disaster, throwing away 20 years of fighting and giving full victory to the Taliban. Lebanon,  Libya and  Syria  have  struggled to  recover from their bitter civil wars. Iraq has managed to establish a more stable government.

His decision to take on Iran seems to have been based on the idea that US/Israeli intelligence and smart weapons were so good that they could kill the leaders of the regime, leading to a change of government and policy more to the liking of the West. This might come about from popular uprising or from the successors to the dead leaders wanting to live and seeing the need to do a deal with the US. The President seemed to think it would be a few days of bombing followed by change.

Instead so far  the killing of leaders has led to new leadership as determined to fight and to resist US/Israeli force. The leadership killed many of their own citizens to make it less likely there would be a sustained popular revolt.They decided on  the high risk strategy of hitting back at US allies in the Gulf, threatening their oil and gas installations when Iran’s were threatened. They adopted the strategy of controlling the Straits of Hormuz, so Iran could get her oil and gas out and let through oil and gas for her allies, but could throttle the rest. Iran continues to use her proxies and terrorist groups around the Gulf area to attack the US and her allies. So far the US has not come up with an answer to this obvious strategy.

It looks as if the President would like a negotiated settlement where both sides would claim a win. It looks as if Iran has sensed the opportunity to squeeze more out of the US by hanging tough. The US is looking at further military options. Could they get the enriched uranium out in a  daring snatch raid? Could they get in  to blow up more of the remaining missiles which bombing has been unable to reach? Could they seize Kharg island, Iran’s oil export point, to throttle Iran’s revenues? Could they seize the Iran coast by the Straits and hold it to allow safer passage of ships?  Would commercial ships take the risk of passage if convoys were organised? There may be other options. Clearly if one is adopted it needs the element of surprise to give the US a greater chance of success. All of them are high risk, and a failure with one would be a further set back to the idea of getting a sensible negotiated settlement. Reports of troop and naval movements imply there is no thought of a major invasion of Iran as that would take many more soldiers than have been seen on the move.

Running a war to tv schedules from the Oval Office is proving more difficult than the President hoped. The sooner he finds a way out for himself and the US the better. The war is unpopular at home and the mid terms beckon. If he loses the Senate as well as the House as a result of another foreign war he may face an impeachment and a final two years of law fare all the way to his exit. The war is also getting in  the way of his major drive to boost the US economy with massive new investment, lower taxes,  digital dominance and cheap energy.

Last thursday was a good day for Conservatives. The party held two Council seats and won one from the Lib Dems. Reform won one from Labour. These were seats in what has often been Conservative territory, but the results were good with a poor showing for the two left of centre parties.

Let me have another go at explaining to this hopeless government why extracting more of our own oil and gas instead of importing is good for jobs, good for tax revenues and good for the environment. They clearly have not  been listening for the last three years as I and others have set this out.

1. If we import LNG instead of getting more of our own oil and gas, we sack our North Sea staff and pay the wages of people abroad instead.
2. If we produce our own oil and gas the Treasury receives large tax revenues. If we import, foreign governments pocket most of the tax.
3. If we use gas by pipe in the UK instead of gas by LNG tanker, we save three quarters of the CO2 created in  producing and delivering the gas to the users. It takes a lot of energy to liquefy, transport and convert back to gas which you do not need for gas by pipe.
4. There is no world price for gas. US wholesale gas is around 75% cheaper than UK wholesale gas because it is gas down a pipe in the US sold under contract. The UK no longer has enough contract gas to keep the price down. There is a world price for internationally traded LNG and that is usually  higher than contract gas to cover all the extra costs.
5. Availability of local gas by pipe helps keep open  chemical industry plants that use natural gas as a feedstock. The present government is presiding over the collapse of our gas dependent  chemical industry.
6. Some of our oil production will be exported, but this is much better than just  importing  more oil. If you import too much overall with no export offsets you need to borrow or sell assets to pay the bills and can end up with a balance of payments crisis.

Kemi Badenoch has rightly called on the government to lift the bans on new exploration and development of known oil and gas reserves.  The government  should immediately press ahead with the Rosebank and Jackdaw fields. The existing pipes and production platforms in the North Sea have spare capacity which can be used for some of the new developments, speeding up their production and cutting the costs of doing so. Claire Couthino, the Shadow Energy Secretary, gave the go ahead for Rosebank in 2023. It took this Labour government to slow it up and then seek to prevent it altogether.

In 2023 Claire Couthino as Energy Secretary  argued that  continuing to extract the North Sea’s  oil and gas reserves “is important for maintaining domestic security of supply and making the U.K. less vulnerable to a repeat of the energy crisis that caused prices to soar after Russia’s illegal invasion of Ukraine.” She  was right to approve Rosebank. It would have helped today if Labour had not introduced a ban.

The Chancellor will doubtless now  blame the Iran war for the lamentable performance of the economy. So far she has blamed the inheritance, overlooking the facts that when she took over the Conservatives had restored growth to being the fastest growing G7 economy and had inflation back down to the 2% target after the wild swings of covid and too much Quantitative easing from the Bank.  She took inflation up to nearly double with large rises in  public sector costs and charges and she depressed output and pushed up unemployment with her taxes on jobs, farms, small business and business property.

Her current spin line is she has prepared the UK economy to withstand the shock of the Iran war, yet the OECD forecast says the UK will suffer the biggest downgrade in growth as it is very exposed. Of course it is. The government has a policy of getting us to import more energy,. more food, more high energy using manufactures through its mad  self harming pursuit of UK net zero. It also happens to boost world CO 2 at the same time!  Imported LNG in a damaged global market is bound to be scarcer and dearer than UK gas down a pipe from our own fields. Imported petrol is likely to be dearer than refined products from our own refiners, yet the government has allowed and created closures through penal taxation of 2 of our 6 refineries.

The government says it wants to tackle the big loss from the fall in public sector productivity but so far has not taken measures that will reverse that loss. It says it wants to control the benefits bill yet it keeps going up and the government invites in many more illegal migrants. It says it has an industrial policy, yet its carbon taxes and high energy prices policy undermines so many factories and plants. The government does not know what to do about the rash of closures in so many industries.

When the issues become too embarrassing it turns to open ended subsidies. It is paying £1.3m a day to keep the last two blast furnaces open, struggling as they do with age and sky high energy taxes and costs. It has had to offer a £100m short term grant  to get the recently closed bioethanol plant re opened to produce enough CO 2 for UK needs.It has helped pubs with rip off business rates but not a lot of other High Street businesses under financial pressures  to close.

So we still have a government rightly committed to faster growth following so many policies that produce the opposite. The Iran war will be used as an excuse, but many of us have been warning from before the war that the UK economy was not going to grow faster anyway.

If the Bank of England now keeps interest rates higher or even raises them that will increase the intensity of the downturn. A big external energy price rise is like imposing a big new tax on UK business and consumers. It is deflationary, after the obvious first round upwards impact on inflation. The last thing the Bank should do is  make it worse on the downside in an orgy of over compensating for its past disaster of printing too much money.

There was meant to be a debate on Thursday in the Lords on national security and civil preparedness for war. I put in to speak. It was cancelled as votes delayed the progress of business and the government decided to defer the debate.

As it is topical let me make some of the points here. Our country is not properly defended if we rely too heavily on imports for our food and civilian necessities, and for the raw materials, components and whole systems for weapons. The bitter  experiences of the last two big wars reminds us that our more modest reliance on imports then was a dangerous vulnerability leading  to atrocious losses of commercial shipping under fire from submarines and aircraft.

Our long years in the Common Agricultural Policy, stopped  us producing enough milk and butter by restricted quotas,  crippled our beef industry following disease, paid us to grub up our orchards and grabbed market share for imports in vegetables. Our industry now only delivers 62% of our food, compared to 78% in 1984 and higher in 1972.

In 1939 there was plenty of capacity to produce the steel and chemicals we needed for weapons. Factories were turned over to making planes, guns and ships as  we had the know how and skills.

Today there are just two steel  blast furnaces left. The government will probably close them after paying a fortune for losses in the meantime. The government’s refusal to get more of our own oil and gas out is helping a collapse in our petro chemical industry. 2 of our 6 refineries have closed under this government, an olefins plant, a bioethanol plant, a big fibreglass plant and others. Ineos has announced withdrawal from UK investment. Huntsman has threatened closure of its chemicals business.

Modern weapons systems also require plenty of computing power. The UK does not have the capacity to make more complex semi conductors, and the UK is very reliant on US technology in general.

Farming grants policy needs to be reoriented away from wilding and solar farms to rewarding and fostering more food production. There needs to be a big change of energy policy, and a removal of emissions trading and carbon tax schemes, to rebuild are high energy using and gas feedstock industries. We need to restore our abilities to feed ourselves, to supply our energy, and to have the ability to make a lot of weapons in a hurry if our islands come under threat again.

 

The Defence Secretary yesterday was unable to tell an interviewer  how many frigates he has in the Royal Navy. After embarrassing stumbles he said there are 17 frigates and destroyers combined. The Wikipedia answer is to list 7 named frigates and 6 destroyers.

You would  have thought he would know these figures as he should have been puzzling for the last month on how to find one destroyer for Cyprus and a destroyer or frigate to lead a NATO exercise. Surely he asked how many there were and asked why they could only free one when he needed two. You would expect  he had enough interest in his 13 main surface vessels plus the two aircraft carriers to have talked to officials long before about where they were and what they were doing.

I have  asked before how come only one of our fifteen main surface ships could put to sea, and that after a delay. I have had people respond defending the idea that most of the ships most of the time should be undergoing maintenance at home. I disagree. More must be available and more should be on missions flying the flag and offering reassurance to our allies and bases abroad by turning up.

This government has withdrawn the last mineseeker from the Middle East. It decommissioned a frigate stationed in Bahrain shortly before the Iran war. It failed to supervise the maintenance and deployment of ships , allowing too many to undergo leisurely repair. The Defence Secretary has failed comprehensively.

The UK gets far too little force for its substantial spend. The MOD whilst pressing for a bigger budget needs to get a lot sharper at buying equipment, and needs to sort out the excessive numbers of senior officers relative to the numbers of troops and sailors.

Not content with giving our sovereignty away to the EU in the reset and our money away to many foreign governments, EU students and migrants, the government is busily undermining our defences.

They want to give away the freehold of our important base at Diego Garcia to a non nuclear state friendly with China. This naval base is crucial to defending trade routes in the Middle East and Indian ocean.

They failed to defend our base in Cyprus leading to demands from Cyprus and the EU that we reconsider that base, crucial to our interests in the eastern Mediterranean and Middle East.

They have negotiated a Treaty with the EU giving them powers over the Gibraltar  border and airport, a crucial part of our air and naval base there.

They have watched as Ukraine has shown the importance of drones to modern warfare without putting in UK capacity to build and use drones in our own armed forces.

They have seen the growing potency of fast ballistic missiles in the Middle East without strengthening our home  defences against these. Why is there no plan and  no urgency to defend these islands against drone and missile attack?

When need arose to provide air defence cover for shipping  and bases in the Middle East they had no naval vessel available to do the job. Most of our frigates and destroyers were undergoing slow maintenance at the same time with no thought for the  need to have any of  our 13 frigates and destroyers available to defend us. Our two carriers also stayed at home. Why? What ‘s the point of a navy with plenty of admirals and no ships at sea?

Two recent wars show the need to rearm . Our Nato  commitments require us to rearm. Where is the defence plan? Where is the money? Where above all is the sovereign will even to defend our islands?