Simon Coveney (Cork South Central, Fine Gael) | Oireachtas source

I will try to answer as many of the questions as I can. There is a meeting of the Seanad special select committee on Brexit tomorrow, where I will be able to go into more depth if Senators want me to in any area.

I will now deal with some of the themes that arose. A number of Senators raised concerns about the need for direct ferry links to deal with congestion in ports. The concern is based on the fact that about 85% of all goods that come into and out of Ireland come via the UK land bridge. As a result, there is a potentially significant point of disruption for goods trade to and from the rest of the EU Single Market, particularly for time-sensitive goods, such as perishable goods, chilled products and so on. We have worked with shipping companies, hauliers, exporters and importers to encourage them to consider contingency plans and use the capacity that is there already and is increasing all the time in the context of direct ferry routes. Even in the past week, the Rosslare-Dunkirk daily ferry service was announced last Friday, while Cork-Zeebrugge was also announced quietly and without too much fuss. A number of new routes over the past 18 months have been announced by various shipping companies, which foresee an increase in demand for direct ferry routes, and that has not happened by accident.

On the current direct ferry routes, however, less than 50% of capacity is currently being used. People talk about the capacity issue and worry that if there is a need for a significant shift away from using the current land bridge route through Holyhead and through Dover to Calais, there may not be sufficient capacity on direct ferry routes. However, we have a great deal of additional capacity, which has increased and continues to do so. We also have the potential for shipping companies to shift capacity off the Irish Sea route to consider greater direct ferry route capacity should it be necessary. While there is a good deal of capacity, we have been encouraging importers, exporters and haulage companies to carry out that contingency in advance and to test those new routes to ensure they work, and to use December to do that, rather than waiting for an emergency-type situation potentially to develop at Dover in a month's time, if and when there is significant congestion. Even when the French tested some of the new checking systems for passport checks alone, there was a 5 km tailback in Kent on the way into Dover. We are starting to get a sense of what we may face in January in the context of delays and disruption.

I cannot recall which Senator mentioned it but there is certainly no chance of the UK providing some sort of green lane for Irish trucks to skip to the front of a 5 km, 7 km, 10 km or 15 km queue. When our lorries are coming off ships at Calais and other EU ports, a green lane operation will separate Irish-origin trucks from the UK traffic because, of course, the checks will not be the same. They will be goods that have originated in the Single Market coming back into the Single Market and using the UK as a land bridge facilitated by the UK signing up to an international transit convention that effectively means that if a container is sealed in Dublin, and if the UK land bridge is crossed to return to the Single Market in France, the seal on the container does not need to be broken as long as it does not involve live animals or other certain food products.To be fair to be the UK, it has signed up to the convention. It has, in fact, been very helpful in the context of facilitating the future use of the land bridge but it is certainly not going to be able to deal with the potential disruption in its own ports and give Irish trucks preferential treatment by comparison with its own. That is potentially a recipe for a lot of tension. That is a contingency we have been planning for and working on. The conversation will continue with shipping companies right until the end of the year, through the transition period and into the new reality we are facing.

Regarding our own ports, there has been a lot of planning involving the Revenue Commissioners, the Department of Health, the Department of Agriculture, Food and the Marine, my Department, the Department of Transport, Dublin Port and, of course, the shipping and haulage companies. There will be a traffic plan for Dublin in place reflecting the new realities. Some of the shipping scheduling poses genuine challenges because large vessels come in at more or less the same time each morning. Many of the goods are demanded at certain times of the day, and shipping companies respond to that demand, particularly in terms of accessing retail outlets early in the morning and so on. Therefore, there will need to be efficiency in the management of that traffic, but I am reasonably confident this is being achieved in a comprehensive way. Of course, there is no perfect solution but there is certainly an enormous amount of contingency planning taking place to secure the smooth running of Dublin Port.

What effectively will happen is that when trucks come off ships, they will either be in a green lane, an orange lane or a red lane. If they are in a green lane, they will go straight through without having to be checked at all. If they are in an orange lane, they will require some customs checks. If they are in a red lane, they will require a much more substantive inspection process. They may have perishable goods and they may need to unload goods for a more detailed inspection. As a result of that, Dublin Port has really been transformed over the past two years in terms of extra parking bays, inspection bays, live-animal stabling, cold-storage facilities and much more. It is worth visiting. Perhaps the Chairman of the Seanad's Brexit committee could take its members to see the port's operations. I expect we will see pilot testing of the systems in the month of December to make sure they are fit and ready for 1 January.

Rosslare has been quietly doing a huge amount of work to get ready. I was really pleased to hear last Friday the announcement about the direct ferry link to Dunkirk because that really means the infrastructure put in place is going to be used. I envisage Rosslare getting busier and busier and potential further routes developing in the time ahead if we see permanent reliance on direct ferry routes rather than a land bridge for many products. That is quite possible because the paperwork involved, the associated delays and the preparations companies will need to make to bring goods across the UK land bridge are quite significant and potentially quite costly. It is doable but it involves hassle. If the goods are not time sensitive, it may well be cost-competitive for people to look for direct ferry routes.

I was glad to hear Mr. Michel Barnier's name mentioned in the House today. There was a lot of support and praise for him. He has done a phenomenal job as a negotiator for the EU. He has shown a capacity to understand and take the time to really read into the vulnerabilities of the island of Ireland as a whole owing to Brexit in a way that many people could not have expected. He has also taken the time to come here on multiple occasions in this regard. When people rightly say the UK has the right to decide its own future, even if we do not agree with the decision or fully understand why, they should note that the UK does not have the right to vote for Ireland's future in terms of where we stand, our place in the EU Single Market and our involvement with it in a peace process on this island.

There is not an anti-British bone in my body but I have an obligation, during this process, to ensure Ireland's vulnerabilities are understood and that we put in place agreements that can protect against the exposure of those vulnerabilities. We need to protect the peace process throughout this period of disruption, and I believe we are doing that as best we can. It is not perfect and it has caused some tension but I believe that, by reaching an agreement on the protocol on Northern Ireland in the context of the withdrawal agreement, we now have protection in international law for a protocol that the British Government has a legal obligation to implement. This is not a political agreement any longer; it is the law, and that is why the response from Ireland and others across the EU to the UK's Internal Market Bill, which essentially threatens to break that law, was as direct and blunt as it needed to be. I say that as a candid friend of the UK, as someone who has benefited from the British education system, and as someone with many family members living in the UK and who has worked in Scotland. Like many in this House, I am in many ways a product of the Anglo-Irish relationship. I believe, however, that Ireland has a responsibility to call this situation as it is because there are many who are trying to warp the messages and the understanding of what Brexit means. We need to try to make sure that we remain respectful, but consistent and firm, in the context of protecting Ireland's interests through a very challenging and potentially very disruptive period.

There are a number of other questions I want to make sure I answer. One concerns the contentious issue of tax rebates, which is going to involve an amendment from the Labour Party on Thursday and, I suspect, a similar one from Sinn Féin. We are not going to accept the amendments but I want to give reassurance here. The initial proposal from the Department of Finance was that it would be appropriate to introduce a threshold of €175. In other words, if a non-EU citizen or someone from a third country, which Great Britain will be, spends over €175, he or she will be able to claim VAT back. What the Department was trying to do was recognise the fact that there will be millions more people coming from the UK into Ireland and that the cost of the bureaucracy of managing the scheme for small amounts of money would be significant.

Deputy Howlin and others made the case that the threshold should either be reduced significantly or done away with altogether. The Department of Finance responded to that by reducing the threshold significantly, to €75 rather than €175, which means much more expenditure will now be subject to the VAT rebate scheme. This is good for retailers. There was a judgment call that I assume the Minister for Finance, Deputy Donohoe, will have an opportunity to talk about when he is in the House on Thursday. Many EU countries apply thresholds that are much higher than €75. What we are trying to do here is provide an incentive to spend money while in Ireland and to do so in a cost-effective way in the context of a VAT return scheme while also trying to recognise that if there is a significant increase in the numbers availing of the scheme, there will be a cost to managing it in respect of small or relatively small amounts of money. That is essentially what is happening. Some have said this measure is not linked to Brexit it all, that it is a separate issue and that it will apply to people coming from the United States. It will but it is linked to Brexit because so many of our tourists are British. This is super and we want to keep it that way but it means the numbers will increase significantly. Therefore, it was deemed appropriate to respond. Having said that, I believe it is not unreasonable to state we need to assess, after the first 12 months, whether the €75 threshold is the right one and whether it should be less, more or done away with altogether.I know the Minister for Finance is open to that but we are not proposing to put the requirement in the legislation. I am stating on record that the Government is committed to doing that review and the Department of Finance will do it. However, it would not be good practice to include in the Bill a commitment to a review because it is not normal to do so in legislation. I am not asking Senators to withdraw their amendments, but to reflect on that. To finish this legislation in a timely manner, it would be really useful if we could get this done this week. I hope that my giving the House a commitment on the review, which I am sure the Minister for Finance, or whoever speaks on his behalf on Thursday, will also make, will be sufficient for Senators.

I take the point made about cross-Border health but I must be honest with people. The EU cross-border health directive will no longer apply to Northern Ireland because it cannot apply. It is not that we do not want it to apply but that it cannot apply. Northern Ireland is no longer part of the European Union and, therefore, an EU directive cannot be enforced in Northern Ireland. What we will do is replicate the directive by agreeing, insofar as we can, bilateral arrangements with the UK to protect cross-Border health. We are pretty confident we can make sure that continues for the people from Donegal who access healthcare in Altnagelvin Hospital today, the children who travel from Belfast to Dublin for specialist paediatric treatment and others, including members of PDFORRA, who access health treatment in Belfast. The Minister for Health has committed to the seamless continuation of cross-Border healthcare. We will work to try to achieve that and the Department is very focused on doing that. The formal application of the EU directive will not be possible in the same way that it was when Northern Ireland was part of the EU.

I take the points made about the Naval Service, which I answered in some detail in the Dáil. We have taken considerable action over the last three months to introduce a going-to-sea allowance, effectively an incentive, of an extra €10,000 over two years as long as people commit to going to sea for that period. I hope that will be one of a number of measures that will ensure we are more successful in recruitment and retention in the Naval Service. I promise that this is a big priority of mine. I live next door to a naval base and I have a pretty good understanding of the challenges that we face. We must overcome them and not shy away from them.

Senator Ó Donnghaile raised the VAT issue. On the frontier workers' scheme, I can be more positive on that. To be fair to Sinn Féin, it has repeatedly raised this issue. In May 2019, David Lidington, on behalf of the UK Government and I, on behalf of the Irish Government, signed a memorandum of understanding on the common travel area, CTA. Irish citizens, including frontier workers, do not need to take action to continue working in the UK. In other words, an Irish or British citizen can, under the CTA arrangements, continue to work in the other country and access healthcare and social welfare benefits, study, take pension entitlements and so on. The CTA in many ways provides a recognition of citizenship in each other's countries. That is not entirely the case but it is not far off that. We will continue to try to protect that.

The position is much more complicated if one is a frontier worker in Ireland or Northern Ireland but not an Irish or British national. Under the withdrawal agreement, EU nationals living in Ireland but working in Northern Ireland or Great Britain before the end of the transition will be able to continue working as a frontier worker but must apply to the UK Government for the settled status scheme to protect their rights. There should not be a problem with that. Obviously, I cannot fully answer for the British Government but from our perspective, I think the frontier worker issue should be okay.

Data and GDPR is a huge issue for businesses and one of the reasons we need to get a deal. People have talked about fishing and a level playing field, which are two outstanding issues that have not been resolved yet. I hope progress will be made on them this week. As I speak, however, they have not been resolved and the gap is still very wide in the case of fishing. There are many other issues, including aviation, road haulage, data, services, financial services, banking, judicial co-operation, security co-operation, defence co-operation and climate co-operation. Eleven different work streams were negotiated and brought forward in parallel. The EU has always said this about agreeing a deal across all sectors and nothing is agreed until everything is agreed. Energy markets is another good example, which I often use. The UK wants to access the EU's energy markets for free. In return, we are saying we would like to access the UK's fishing grounds. This works both ways and both sides can benefit as long as there is reasonable give and take on both sides.

I take the point made about data. I hope we will know an awful lot more if and when a deal emerges in the coming days, I hope, because we are running out of time. If we do not get a deal, data will become a very big issue and managing it will become part of EU contingency planning. If there is no deal and if there are emergency contingency measures that are facilitated by the EU and the UK, it will be pretty bare bone stuff around things that are pretty fundamental to the facilitation of movement and trade. That is why the stakes are so high in the context of what we are attempting to agree at the moment between the EU and the UK. As Senator Conway said, many people have no idea of the level of disruption that we will have to manage as a country in the absence of a deal and, indeed, the UK even more so.

On more positive areas such as Erasmus and research, we have said in the context of Northern Ireland that we would like to get a deal on access to the Erasmus scheme for UK citizens and, obviously, Irish citizens in Northern Ireland. If that is not possible to negotiate with the British Government and the EU, Ireland and the Irish Government will pay for students in Northern Ireland to be able to access the Erasmus scheme. We will put a system in place of registering through Irish universities to facilitate that, if necessary, because we believe it is such a fundamental student opportunity for people in Northern Ireland. Likewise, with the European health insurance card, EHIC. We cannot replicate EHIC exactly for people travelling but we will put in place a scheme to allow people from Northern Ireland who are holidaying or travelling around the EU and may have to access EU healthcare to get a rebate through the Irish health system when they return. Again, we have said we will pay the cost of that if we have to, which is about €4 million. I am very hopeful that Irish taxpayers will not have to pay for this, certainly not all of it, and that we will have an agreement that involves the UK Government and the Northern Ireland Executive to facilitate those kinds of schemes, so that we can follow through on the commitments in the protocol to protect people's rights, as well as economic opportunities that come with EU membership or extended EU membership. People in Northern Ireland have a right to be British, Irish or both and if one has a right to be Irish, one has a right to be European or an EU citizen, I should say. We are all on European, thank God; Britain has not left Europe yet. It is important that the Irish Government goes beyond the limitations of the protocol and is generous in that regard, which I believe we will be. The future was raised by Senator Kyne and others. Britain is our closest neighbour. We have so many responsibilities that we work on together, particularly in the context of Northern Ireland. We need a relationship post Brexit that is different but is equally important. I spent some time today with our team talking about the kind of infrastructure that may be needed and designed between the British and Irish Governments in terms of how we might do that in the future. I have on a number of occasions proposed that in a practical sense, that would mean an annual UK-Ireland intergovernmental summit, which would not only be about the Prime Minister and the Taoiseach but would involve multiple Ministers - up to six, eight or ten Ministers - which would require our Departments to put agendas together and plan for those agendas, and that we would have face time with our counterparts in the British Government to get to know them to create relationships. One of the great values of the European Union is that one meets colleagues all the time. In Strasbourg, in Brussels and in Luxembourg, one solves problems with them around the table. One has political discussions and debates on policy as to what the EU should be doing together. One builds relationships. Those kinds of interactions simply will not happen unless we make them happen in the context of future political engagement with the UK. That is why it is important that Irish Ministers know and understand the perspectives coming from their British counterparts. They might not always agree but they need to be at the end of a phone. Rather than allow those relationships to break down or to become more formalised and too structured, particularly when we have to deal with crises together when one relies on trust and relationships to find a way through, I believe we have a responsibility to try to make sure that we design structures that can work under the new realities post Brexit.

Senator Mullen talking about potatoes was a new departure for me. The Senator is correct. The potato industry will have to change as one of the many industries that will be forced to change as a result of Brexit. Who knows? We may be able to negotiate in the future veterinary agreements and food safety agreements that can allow us to import seed potato from third countries such as the UK but for now, we cannot. Whether it is seed potatoes or whether it is the varieties of potato that suit for making chips in Ireland, the 80,000 tonnes of ware potatoes that are produced for chips are unlikely to be coming from the UK from 1 January and those supply chains will have to be redesigned and restructured. Incidentally, there are many other countries across the European Union that export potatoes and, therefore, there are other options. It is an example of the kind of reality change that we will be experiencing. It will not only be potatoes. There will be many other areas where supply chains and normal trade will start to look different. It is not all downside, by the way, but it is different. We have to plan for that and make sure that businesses are planning for it too.

Senator Seery Kearney raised the question of British people in Ireland getting an Irish passport and the cost of so doing. I will look into that issue. The Senator mentioned it to me a week or so ago. It is an issue I am a little uncomfortable with. If somebody is a British citizen living in Ireland under the common travel area, CTA, and that person wants to change his or her citizenship to become Irish, we should not be making it difficult for him or her to do that.