Windsor Framework: Northern Ireland manufacturer does not believe agreement's green and red lanes will benefit his company

Ashley Piggot, is managing director of AJ Power in Lurgan. The company employs 125 people making diesel generators, which they sell across five continents. Some of their 80% components are supplied from England, which means his company incurs significant extra costs coping with EU customs paperwork required by the NI Protocol.

The Windsor Framework, agreed by the EU and UK, proposes red and green lanes to try and resolve the problem. Goods destined for NI only would see reduced paperwork while goods destined for the EU would complete full paperwork as normal.

But Mr Piggot says that - like most NI manufacturers - he cannot guarantee his final products will not go into the EU/Republic and therefore cannot benefit from the green lane.

"The challenge for Northern Ireland manufacturing with the Windsor Framework is that we are unaware of any of the Customs operational guidelines for it having been issued yet," he told the News Letter.

" From a manufacturer's perspective, as with the Protocol, we keep coming back to the question of [the EU] definition of what is 'at risk' and how we can prove our goods will stay in NI.

As with most manufacturers, he says, when they receive their component parts from GB before the manufacturing process, they cannot determine the destination of their final manufactured product, he says.

"Therefore, everything that we bring in from GB, will have to go in the red lane - for full EU customs checks. The green lane, we believe, will only be beneficial to supermarkets and high street stores."

Completing the EU customs paperwork for bringing goods into NI from GB has "a significant cost" he adds.

He says the government is paying the bill for its TSS until the end of this year - but asks who will pay for it in 2024?

He estimates that it has cost £340m over the past two years.

"A very conservative estimate of the cost to Northern Ireland PLC of GB to Northern Ireland paperwork is a quarter of a billion pounds per annum."

The other major issue, he says, is customs duty divergence.

He notes that customs duties are much lower on goods coming into GB than for goods entering the EU.

"As an example, we have a major multinational competitor based in the Secretary of State's constituency of Daventry in Northamptonshire.

"They can import engines from outside the EU for sale in Great Britain and pay zero customs duty using a system called GSP.

"But we will have to pay 4.2% EU Customs duty for bringing the same engines into Northern Ireland, which in monetary terms can be up to £3000 per engine."

"So having access to the EU market is one thing, but being able to compete in that market is another."

The Windsor framework has stated that it will establish a new tariff reimbursement scheme to overcome this problem, he notes.

"But we suspect it will be a modification of inward processing relief, where generally the cost of using it outweighs the benefit that it gives."

A UK Government spokesperson said: “A first-of-its-kind green lane will enable goods destined for Northern Ireland to move easily without burdensome customs bureaucracy. This will be underpinned by the existing Trader Support Service.

“Ministers have engaged extensively with a range of businesses and we have spent a significant amount of time listening to and addressing their concerns.

"We will continue to work closely with businesses in Northern Ireland, and across the whole United Kingdom, as we put these new arrangements in place."