FT recommends staying in the customs union to help solve the Irish problem

Irish Finance minister Michael Noonan was too hasty in slapping down “a special deal on the side ” between the UK and Ireland in response to the report on Ireland and Brexit  from the Lords EU committee. He spoke even as it was admitted that Ireland  would probably be worse affected than Britain. This is no time to reject any well-intentioned idea for resolving what is probably the single most difficult problem of Brexit.

The committee was also right to demand that the UK should unilaterally guarantee the citizen rights of  EU nationals living in Britain, rather than treating them as a bargaining chip. Irish citizens are separately guaranteed under the 1949 and other non-EU Acts.

The full impact of citizens’ rights in the North still hasn’t been fully explored. Irish passport applications are at record level.  Brexit would leave UK passport holders at a disadvantage compared with the Irish in the EU including Ireland. This would  create a basic inequality of citizens’ rights within the purview of the Good Friday Agreement. The British created the problem; but the Irish would be perpetuating it by giving Irish passport holders priority by virtue of remaining in the EU. This looks like a serious cause of potential disruption within British –Irish relationships and it looks bad to say the least if Ireland, as the co-guarantor of the GFA appears to  champion the rights of nationalists over unionists.

The FT this morning corrects (£) Mr Noonan’s misapprehension that any special deal would be made outside the EU and it sides the Lords EU committee and makes a bold recommendation.

If the UK leaves the customs union — as some in Prime Minister Theresa May’s government are hoping — the trading relationship between Britain and Ireland could face significant disruption. Anglo-Irish trade is worth €60bn and directly supports 400,000 jobs, according to the House of Lords report. Ireland’s agriculture sector in particular would suffer from new barriers, given that 40 per cent of its exports go to the UK.

While Ireland’s trade agreements can only be set in Brussels, a bespoke agreement covering control of the Irish border — and movement of people across it — could be negotiated as part of the wider Brexit deal. Even if the UK negotiates a free-trade agreement with the EU that mirrors the current tariff regime, goods would still be subject to “rules of origin” checks.

An online system of customs controls could solve this problem. Alternatively the agreement between Norway and Sweden, by which Swedish officials inspect premises in Norway, could be replicated but would be politically complicated. Nor would a UK-Ireland customs union work: it would be both illegal and impractical for Ireland to be in a customs union with both parties. If such a bespoke deal is impossible, Britain should not rule out minimising disruption by staying in the EU customs union.