Michael McGrath (Cork South Central, Fianna Fail)
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36. To ask the Minister for Finance the customs arrangements that he and his Department expect to apply between the Republic of Ireland and Northern Ireland in the event that the United Kingdom leaves the customs union as part of its exit from the European Union; the impact he expects these customs arrangements will have on trade and the day-to-day movement of persons across the Border; and if he will make a statement on the matter. [10409/17]

Michael McGrath (Cork South Central, Fianna Fail)
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This question follows an exchange we had at the Oireachtas finance committee recently about the nature of the customs border that may emerge, or be agreed, in the context of Brexit. There is a lot of concern on the island, and particularly around the Border counties, about the nature of the Border that will emerge over the course of these discussions if the UK leaves the customs union to which it is currently party. The Minister put some helpful information on the record in the committee in recent weeks following discussions he had with Revenue and I hope he can elaborate on that today and put on the record of the House how he envisages this developing over the months ahead.

Michael Noonan (Limerick City, Fine Gael)
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The Government's headline priorities in response to Brexit are well known: minimising the impact on trade and the economy, protecting the Northern Ireland peace process, maintaining the common travel area and influencing the future of the European Union. It is quite clear that there are major challenges ahead for the EU, the UK and for Ireland.

The position in relation to the Border with Northern Ireland in the context of Brexit is very clear and has been articulated by the Taoiseach on several occasions. Continued freedom of movement, absence of a hard Border and minimal impact on business and trade are key objectives. The Government is clear that any manifestation of a hard Border would have very negative consequences. A key priority is to ensure the continued free flow of trade on the island and the need to avoid a hard Border. Clearly, in this regard the closer the trading relationship between the UK and EU is more generally, the better.

My Department has been preparing for the impact of Brexit since well before the referendum on 23 June 2016, with this work now intensified. The primary areas for the Department of Finance relate to the economic and financial sector implications stemming from Brexit. This work is being undertaken within the whole-of-Government framework established by the Department of the Taoiseach and will be an important input role to ensuring Ireland's interests are protected in the upcoming negotiations at EU level and in terms of minimising any adverse impacts on our economy.

The precise arrangements that will apply after Brexit will depend on the outcome of negotiations between the EU and UK after formal notification under Article 50.

Michael McGrath (Cork South Central, Fianna Fail)
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I thank the Minister very much for his reply. A number of weeks ago, he spoke about a traffic light-type system, whereby the vast majority of goods going over the Border could be dealt with by way of electronic scanning. He also said that a small percentage of goods going over the Border might be subject to random physical checks. Given that the EU is already trading with third-party countries that are outside the customs union, there must be a precedent as to how this might work in practice. Whether we like it or not, the Border between the Republic and Northern Ireland is likely to become the border between the EU and a third-party country that will be outside the customs union. That has serious potential implications for the conduct of trade, cross-Border shopping and the day-to-day life of tens of thousands of people crossing the Border.

Can the Minister give his assessment of what are the options? We know that Revenue has been looking at different scenarios and contingencies. Where would the Government like to take this debate about the nature of a customs border on the island of Ireland?

Michael Noonan (Limerick City, Fine Gael)
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The Government's policy position is clear. We want to continue with the invisible Border as it is now or to put it another way, we do not want any hard Border reimposed between ourselves and Northern Ireland. What I described in committee was not anything that would happen or is happening on the Border. I described how goods from third countries under WTO rules are now treated at the point of import into Ireland. I particularly referenced Dublin Port because many of the goods come in through there. I noted that with advances in technology, all the necessary documentary clearance is done electronically.

The Deputy referred to the traffic-light system. Some 92% of imported goods from third countries are now cleared electronically before they come to the port of import in Ireland. They pass through without further examination.

A further 6% of imported goods are in the orange category. In those cases, if the method of transport is by container the Revenue will expect a manifest of the contents to be supplied. Revenue checks the manifest but there is no physical inspection of the goods in that respect. Less than 2% of goods are physically examined at the port of import.

Michael McGrath (Cork South Central, Fianna Fail)
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I thank the Minister for his reply. If the UK leaves the customs union and if there is no agreement on the conduct of trade, then the default position is World Trade Organization terms. That means there will have to be some control in place. It cannot mean there will be nothing in terms of the oversight and regulation of goods going over and back across the Border. We need to know what is the Government position on the use of technology, including electronic scanning. The Minister referred to imported goods coming through Dublin Port from third-party countries, some of which would be under WTO terms. Can that have practical effect across a land Border of up to 500 km with several hundred major and minor crossing points? Tens of thousands of people cross the Border every single day of the week. Can technology be deployed in such complex circumstances? I appreciate that this negotiation is only about to commence, but it would be useful for people to hear what is the Government's objective, recognising that the UK is likely to leave the customs union. That must mean something in terms of controlling the cross-Border movement of goods.

Michael Noonan (Limerick City, Fine Gael)
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The Government's policy position on its approach to the negotiation has been expressed in our contacts with the UK authorities both at the political and Civil Service levels. It is that people, goods and services should pass without let or hindrance from North to South and vice versaand there will be no change in the present position. We know that the British negotiation position is to have a free trade agreement between the United Kingdom and the European Union. We suppose that they will make some progress in that negotiation and that if there is not a full free trade agreement, at least there will be something that would be significantly better than the default position of a World Trade Organization arrangement with the UK, treating them as absolute outsiders in a third-country category.

Effectively, therefore, we will have to wait to see what the results of the negotiations are. In the meantime, various Departments and State agencies are looking at the implications both of the free travel area and the invisible Border policy objective which we have. In that context, various options are being examined but it is not possible to make decisions until we see the outcome of the negotiations between the EU and the UK or until they are well advanced.

Eugene Murphy (Roscommon-Galway, Fianna Fail)
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We are grouping Questions Nos. 37 and 40 in the names of Deputy Pearse Doherty and Deputy Michael McGrath. Can Deputy Doherty do the introduction? He has 30 seconds.

Pearse Doherty (Donegal, Sinn Fein)
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I was not notified that there was a grouping. Were we notified earlier on?

Eugene Murphy (Roscommon-Galway, Fianna Fail)
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I am acting here as temporary Chairman and I am going by what has been given to me. I presume it was agreed.

Pearse Doherty (Donegal, Sinn Fein)
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It is not agreed by the Opposition. It is imposed on us.

Eugene Murphy (Roscommon-Galway, Fianna Fail)
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I can only do what I have here, so I would ask the Deputy to introduce his question.

Pearse Doherty (Donegal, Sinn Fein)
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I did not see it. For the record, my priority question has been disallowed. The Minister will not answer questions on Project Eagle and a commission of investigation.

Eugene Murphy (Roscommon-Galway, Fianna Fail)
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I cannot allow that.

Michael Noonan (Limerick City, Fine Gael)
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Everybody, including the Deputy, knows that the disqualification request is not a matter for the Minister. It is a matter for the Chair.

Eugene Murphy (Roscommon-Galway, Fianna Fail)
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It is the Ceann Comhairle who decides on that issue, so I do not think it is fair for the Deputy to bring it up here in the Chamber when we are dealing with questions to the Minister for Finance.

Pearse Doherty (Donegal, Sinn Fein)
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I think it is perfectly fair.

Eugene Murphy (Roscommon-Galway, Fianna Fail)
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The Deputy is wasting the time of the House. Will he please take it up with the Ceann Comhairle and not with me? I ask the Deputy to proceed and introduce his question please.

Pearse Doherty (Donegal, Sinn Fein)
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I am going to introduce my question.

Eugene Murphy (Roscommon-Galway, Fianna Fail)
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Well please introduce it, thank you.

Pearse Doherty (Donegal, Sinn Fein)
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I will make reference to the fact that my priority question this month has been disallowed.

Eugene Murphy (Roscommon-Galway, Fianna Fail)
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That is not an issue for me.

Pearse Doherty (Donegal, Sinn Fein)
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I am not satisfied because it is supposed to be hypothetical, as if customs control in terms of Brexit is not hypothetical also.

Eugene Murphy (Roscommon-Galway, Fianna Fail)
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I see the Deputy is agitated about that issue, which is fair enough. I am asking him to take it up with the Ceann Comhairle, not here. Will he please proceed and introduce his question?

Pearse Doherty (Donegal, Sinn Fein)
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I will proceed if the Acting Chairman stops interrupting me. I have made my point.

Eugene Murphy (Roscommon-Galway, Fianna Fail)
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You are continuing to make it. The Deputy has 30 seconds to introduce his question.

Michael Noonan (Limerick City, Fine Gael)
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I would like the Deputy to withdraw the false allegation against me that I refused to answer his question.

Eugene Murphy (Roscommon-Galway, Fianna Fail)
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I think he should because this is a matter for the Ceann Comhairle.

Pearse Doherty (Donegal, Sinn Fein)
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I did not say he refused.

Michael Noonan (Limerick City, Fine Gael)
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The Deputy did.

Pearse Doherty (Donegal, Sinn Fein)
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I said the Minister will not answer because-----

Michael Noonan (Limerick City, Fine Gael)
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The Deputy did what he always does - make false accusations.

Pearse Doherty (Donegal, Sinn Fein)
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Nobody claimed that. I said the Minister will not answer because the issue has been disallowed.

Eugene Murphy (Roscommon-Galway, Fianna Fail)
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Can Deputy Doherty please resume his seat for a moment? The reality is that the Ceann Comhairle makes the rules. I have had questions disallowed by the Ceann Comhairle and I accept that. The Deputy should accept it now and move ahead. It is not for discussion here. I appeal to the Deputy to use his 30 seconds to introduce his question. He can take the issue up with the Ceann Comhairle.

Pearse Doherty (Donegal, Sinn Fein)
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I will do that at your invitation. I will also correct the record of the House that you asked me to do.

Eugene Murphy (Roscommon-Galway, Fianna Fail)
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Thank you.

Pearse Doherty (Donegal, Sinn Fein)
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For the record, what I have said is that my priority question in relation to Project Eagle has been disallowed. The Minister will therefore not answer questions on that. I am not asserting that it is the Minister who disallowed the question. Indeed, the Minister did answer questions at the committee before, so nobody should jump to conclusions, but I am not satisfied that this has happened. We will bring that up with the Ceann Comhairle.

Eugene Murphy (Roscommon-Galway, Fianna Fail)
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That is fine. Please proceed with Question No. 37.