As always, we hope you find this update useful and if you have been forwarded this by a colleague you can sign up to receive this monthly update here.

Jonathan Hawkings

Director of Policy

POLITICAL ROUND-UP

In this section we summarise ADS’ political activity over the past month, updating on recent politial meetings, consultations ADS has responded to and any other key political updates that are useful for ADS members.

Political meetings

Last month, the PEPAM team held meetings with:

• Trudy Harrison MP, DfT – On 7 December, ADS had an introductory meeting with Trudy Harrison MP, Parliamentary Under Secretary of State at the Department for Transport. In the meeting, ADS discussed the Government’s Jet Zero Strategy and in particular, the use of Sunstainable Aviation Fuels (SAF). ADS highlighted the need for a financial settlement for the Aerospace Technology Institute (ATI) following the announcement of its extension in the Autumn Spending Review and also discussed the 2022 Farnborough Airshow.
  
  
• Defence Committee – On 15 December, ADS met with the clerks of the House of Commons Defence Committee to discuss its plans for 2022. The Committee is meeting in early January to confirm its 2022 programme but it could include an inquiry looking forward to Future Combat Air System (FCAS) and Tempest, following on from its Army and Navy inquiries last year. The Ajax inquiry will continue into 2022. Other possible inquiries highlighted by the clerks included topics such as the grey zone, defence and technology, and cyber.
  
  
• BEIS Business Representatives Call – On 21 December, ADS joined the regular Business Representatives Call chaired by the Business Secretary Kwasi Kwarteng MP. The call focused on the impacts related to COVID and the Omicron variant, and the Secretary highlighted how he was mindful of any additional restrictions on business. More widely, there were discussions on cash flow issues and the cost of energy on businesses.

Consultations

This month, Aerospace Policy Adviser Andy Phillips will be submitting responses to two sustainability related consultations. Firstly, to Transport Scotland’s consultation on the Scottish Aviation Strategy and secondly to the Transport Committee’s inquiry on ‘Fueling the future’, where Andy will set out ADS’ support for practical policies on Sustainable Aviation Fuels. If members have any questions or would like to input into the responses, please get in touch with Andy by Friday 14 January.

Covid updates

Rising cases of both the Omicron and Delta variants have seen a tightening of restrictions across the UK in conjunction with a nationwide vaccine booster roll-out. Restrictions include a return to working from home where you can, mandatory face coverings in many indoor public spaces, and Covid passports for large events. All three devolved administrations have imposed stricter restrictions on gatherings.

The UK Government has announced an easing of travel testing measures in England, with the removal of the requirement for pre-departure tests on return to England as well as moving from PCR and self-isolation to lateral flow tests on arrival.

More information can be found on the ADS Covid Hub.

POLICY UPDATES

This section provides updates on key policy developments related to ADS sectors over the last month, with analysis from the ADS Policy and Economics team. The team post blogs on a regular basis which are viewable in our Views & Analysis section of our website.

Reports, articles and analysis

Please find below some useful articles, reports and analysis from think tanks and other policy organisations that the ADS PEPAM team have been reading over the past month:

• The Spending Review and the UK’s Strategic Priorities: Whitehall Report by Malcolm Chalmers, RUSI – A report by RUSI assessing the domestic tilt evident within the Government’s Integrated Review and the Spending Review 2021.
• Britain and the Geopolitics of Space Technology: Report by Dr John Sheldon, Policy Exchange – A report by Policy Exchange, with a foreword from the Rt Hon Chris Skidmore MP, on the need to treat space as a strategic sector of national security interest.
• The Institute for Government’s half time review of the 2019 Conservative Party Manifesto – This report updates the IfG’s manifesto analysis from April 2021, analysing how many of the Conservative Government’s 2019 manifesto pledges are completed or on track, are at risk of failure, or have been delayed, suspended or abandoned.
• Living with the variants – This article shares policy recommendations from the CBI on how Government can keep the economy open and support business in living with COVID-19.

CUSTOMS

The start of the new year brings with it some new customs requirements for the importation and exportation of goods between Great Britain and the European Union, as well as a new set of commodity codes for businesses to acquaint themselves with. New requirements from 1 January 2022 include:

• Full customs import declarations for goods at the time they are bought into Great Britain.
• Customs controls implemented at all UK ports and other border locations.
• If businesses are using the Trade and Cooperaiton Agreement (TCA), suppliers’ declarations proving the origin of goods (either UK or EU) will be required to access zero tariffs.

There is more information explaining these changes, what they mean for businesses, and how to prepare available on GOV.UK and the ADS Brexit hub.

NORTHERN IRELAND

At the end of last year, the UK Government dropped its demand to remove the European Court of Justice as the arbiter of trade rules in Northern Ireland. The Government’s former Brexit Minister Lord Frost had decided to put the Protocol’s governance issues to one side until the UK and EU had agreed on practical ways to improve the flow of goods between Northern Ireland and Great Britain. Foreign Secretary Liz Truss, who has taken on the responsibility for negotiations with the EU following Lord Frost’s departure, has indicated she would like the Protocol issues settled by the end of this month.

Before Christmas, the Government decided to extend the current arrangements for moving goods from the island of Ireland to Great Britain for as long as discussions on the Protocol continue. This means that these goods will continue to move via the arrangements that applied at the end of 2021 and will not be affected by the changes introduced on 1 January 2022 for all other inbound goods. A meeting between the Foreign Secretary and European Commission Vice-President Maros Sefcovic is due to take place next week and ADS will keep members informed of any relevant updates.

AVIATION SAFETY

The TCA included a two-year exemption period whereby EASA-issued licenses and organisational approvals would be valid in the UK. Pending any further negotiations, these extensions will expire on 31 December 2022. The Government has been clear that there will be no further annexes to the TCA negotiated in the near future; this means that many non-UK licenses and organisational approvals that are currently recognised in the UK will no longer be valid in the UK after 31 December 2022. It is therefore important that any holders of EASA approvals and personnel licenses begin the process of obtaining their UK equivalent by applying to the CAA as soon as possible.

This exemption however does not apply to EASA Form 1s. The recognition in the UK of an EASA Maintenance Form 1 will end on 31 March 2022. For EASA Form 1s to be recognised in the UK after that date, the organisation issuing the EASA Form 1 must have applied to the CAA for an equivalent UK approval via the CAA before 31 March 2022. You can read more on the CAA website.

National Security and Investment Act

On 4 January 2022 the National Security and Investment Act (NSIA) fully commenced. This provides the Government with new powers to scrutinise and intervene in investments that could harm UK national security. The NSIA replaces the powers within the Enterprise Act 2002 and sits alongside the UK’s competition policy regime.  It implements a two-track notification regime, with 17 sensitive areas of the economy (including defence, space and critical suppliers to government) required to make a notification about any potential acquisitions and transactions to the government. Guidance on the gov.uk website sets out how to assess whether to make a notification and what to expect when going through the notification and assessment process, as well as a range of other considerations.

ADS engaged extensively with members and the Government on the development of the legislation since 2018 and will continue to monitor the implementation of the new national security regime, paying particular attention to the speed and efficiency of the new screening regime operating by the government’s Investment Security Unit. If you would like to find out more about the NSIA or have any early feedback or concerns about its implementation please contact Nathan Mathiot, ADS’ Senior Policy Advisor for Security and Resilience, at nathan.mathiot@adsgroup.org.uk.

Political Outlook

2022 will be another incredibly busy year political for ADS’ sector. There are several key Government strategies and policy announcements we are expecting throughout 2022. The following strategies and policy announcements are expected in early 2022:

• Jet Zero Strategy and consultation outcome – the Department for Transport will publish its plan for net zero aviation by 2050 following a public consultation which took place in 2021.
• Defence Space Strategy – the Ministry of Defence is expected to publish a strategy that outlines the UK’s approach to defence space capabilities.
• National Shipbuilding Strategy Refresh – The Ministry of Defence is expected to publish the National Shipbuilding Strategy Refresh, which will encapsulate the broader shipbuilding enterprise and look at themes such as skills, exports, and technology, particularly the opportunities associated with clean maritime technology.
• Land Industrial Strategy – This strategy will aim to reset the Army’s relationship with industry, providing transparency and confidence, to enable investment.
• National Resilience Strategy – The Cabinet Office seeks to launch the National Resilience Strategy to build a resilient society which can ‘respond to the unexpected.’ This followed a call to evidence which concluded in September 2021.
• Levelling Up Strategy – The Government is expected to publish a Levelling Up White Paper to define its ambitions and set objectives in the run up to the next General Election.
• Call for evidence on transit, simplified procedure and intermediaries

There will be further announcements and House of Commons Select Committee inquiries which we expect throughout 2022 and these will be highlighted in this update each month.

We hope that you have found this edition of the ADS Policy and Government Affairs Update useful. We are always looking for feedback to ensure this update is as relevant for ADS members as possible, so please do get in touch with ADS Public Affairs Manager Thom Rawlinson. 

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