What does Brexit mean for Northern Ireland co-ops?

‘Clearly we are staring at a huge crisis if we crash out without a deal’

Tiziana O’Hara, founder member of Co-operative Alternatives, spoke to co-op members from across Northern Ireland to see how they would be affected by a no-deal Brexit.

The co-operative sector in Northern Ireland includes new and well-established co-operatives, ranging from multi-million pound agri-coops to credit unions and emerging worker co-ops.

In the past few years, Co-operative Alternatives has been bridging across co-operatives, creating opportunities for them to discuss their needs and recognise their common values and principles.

Tiziana O’Hara

At the same time, we looked for fertile grounds where the seed of co-operation could grow into new enterprises; we directly worked with 18 new co-operatives and supported 10 share offers in the region.

In the event of a no-deal, the main concern is the long-term effect on our local legislative assembly which could indefinitely prolong what we have experienced so far: a lack of accountability in decision making – and no government programme for growing sustainable communities and the economy within Northern Ireland.

We also talked with local co-operatives and here some insights on how a no deal would affect them.

Paul Coyle, general manager of Northern Counties Co-operative, said the real issue is a lack of clarity and the uncertainty around the border.

“About 60-65% of the lambs produced by our members are for the Irish and European markets,” he said, “and those producers could be potentially the hardest hit. Currently the majority of lambs is also brought over the border to slaughterhouses in Ireland before returning to Northern Ireland ready to be exported to the EU. A hard border with tariffs may well affect already low profit margins for the producers as well as make the transport across more unpredictable.”

Northern Counties is based in Swatragh, in the centre-north of Northern Ireland, more or less 60 km from any of the border counties of Ireland. It has been serving the farming community for over 50 years with a farm ware store, a livestock market (the last livestock mart co-operatively owned in NI), and machinery auctions. It also offers training and advice to farmers to become more efficient in how they run their farming business and compliant with regulations and legislation.

“Diversification has been the predominant trend in this sector for a while,” added Mr Coyle, “but now it is combined with the uncertainty about agricultural subsidies after 2022, a reduction in profitability for export markets, and a real reluctance in capital investment”. This leaves farmers and the sector with hard choices to make about the future.

Pat Close, general manager of Lough Neagh Fishermen’s Co-operative, said: “Brexit and all its uncertainties are making life extremely stressful at present – as you can imagine, given that 80% of our eels go to the continental mainland each year.

Related: Alison Graham from the Irish Co-operative Organisation Society on Brexit

“We do, of course, face the prospect of tariffs and a significant increase in the administrative burden just like any other business wishing to export.”

He added:  “More significantly, our eels have been listed by CITES (the Convention in International Trade of Endangered Species) for some years now and effectively we have been trading under licence from the EU through our Eel Management Plan (a stocking and escapement of mature fish programme) with which unlike similar operations in Europe we have remained compliant.

“Now that facility will no longer be open to us unless what is known as a NDF (non-detriment finding) can be established. In any event it will be some months before we know and our season is due to open in a few weeks.

“If we crash out without a deal then we will immediately lose access to markets we have supplied for more than 50 years and will have to rely on the domestic market which has traditionally accounted for only a fraction of our output. Clearly, the future prospects of our fishermen is under very real threat as are the skills, tradition and heritage of our industry and the space we have enjoyed for decades as Europe’s largest producer of wild caught eel, fished sustainably.

“There is a limit to the domestic market and while hypothetically other more distant markets beyond Europe may become available to us we know already that logistical difficulties in supplying product in the volumes we need into an already very competitive market is likely to prove unviable let alone the years upon years needed to build up new client relationships comparable to those which we have enjoyed for decades with our European partners.

“Clearly we are staring at a huge crisis if we crash out without a deal.”

We also heard from William Millar, treasurer of Slemish ntha Braid Credit Union and founder member of the Raglan Community Development and Renovation Society (RCDRS) in Harryville, Ballymena.

He said: “By a long way the most important point in this is that our software provider is based in the Republic and despite the fact that they use a UK address they are very much Dublin based, so the need to ensure a seamless transition around software support is essential. Credit unions traditionally are cash rich so they need various investment vehicles for their spare cash. Currently we can invest in government bonds of any European Union state, I suspect this may change.

“Finally, there is the desire from some people for a border poll; any move to unification would bring us under Central Bank legislation which is very different to the PRA/FCA. Turning to the RCDRS, European Funding like Peace IV [European funding] does play a part in what we do, so this situation would need to be carefully managed.”

Finally, we heard from Elena Martin, founder member of Lunasa Workers Co-operative, based in Belfast. She said: “We aren’t preparing well at all because we haven’t got a clue of what would be the scenario. No information has been made accessible, no one has a definite idea of what a no deal Brexit will entail.

“And that’s the main problem for us, the running blind. Especially for our co-op with a majority of Europeans in it.”