Anger in UK over reported US$50 billion Brexit ‘divorce’ bill

But investors are optimistic the reports heralded a breakthrough, sending the pound to a two-month high against the US dollar

PUBLISHED : Wednesday, 29 November, 2017, 9:26am
UPDATED : Wednesday, 29 November, 2017, 9:02pm

Brexiteers and europhiles reacted angrily to reports on Wednesday that Britain will pay up to 55 billion (US$63 billion) to leave the European Union, putting pressure on British negotiators before key talks.

London and Brussels have agreed that Britain will pay between 45 billion and 55 billion, according to The Daily Telegraph.

EU chief negotiator Michel Barnier refused to confirm any reports, calling them “rumours”.

“There is a subject on which we are continuing to work – despite the claims or rumours in the press today, that’s the issue of financial engagements,” he told a security conference in Berlin.

Pro-Brexit supporters reacted with anger to the reports, with leading campaigner Nigel Farage calling the reported figure “utterly unacceptable”.

“For a sum of this magnitude to be agreed in return for nothing more than a promise of a decent settlement on trade represents a complete and total sell-out,” he wrote in The Daily Telegraph.

Meanwhile, pro-EU Labour lawmaker Chuka Umunna said the government’s apparent climbdown dispelled pro-Brexit campaign claims.

“This is a whopping great symbol for the impossibility on delivering Brexit on the terms it was sold to the British people,” he told BBC Radio 4’s Today programme.

Investors were more optimistic that the reports heralded a breakthrough, sending the pound 0.5 per cent higher against the dollar – a two-month high.

The newspapers said negotiators, led on the British side by Olly Robbins, reached the understanding at meetings in Brussels last week.

An agreement would be a breakthrough as Britain prepares for an EU summit in December where it is hoping to start the next phase of talks on future trade ties with the EU.

It would leave two major areas on which the two sides still do not agree – expatriate citizens’ rights after Brexit and the future of the Irish border.

Irish deputy PM quits, averting government collapse ahead of crunch Brexit talks

One key area of contention is whether the 3.2 million EU citizens living in Britain will continue to be allowed to appeal to the European Court of Justice or whether their rights will be governed by British courts, as London insists.

So far both sides have avoided publicly declaring a clear-cut number for what Britain owes the rest of the EU.

Prime Minister Theresa May had offered to cover Britain’s contributions to its budget in 2019 and 2020 – a total of around 20 billion. That pledge was reportedly doubled to 40 billion at a meeting in London last week.

The Telegraph quoted an EU source with knowledge of the talks said the text of the financial agreement would allow a “low figure” to be generated for the British public but would also give the EU the certainty it is looking for.

Asked about the reports, a spokesman for Britain’s Department for Exiting the European Union said “intensive talks” are taking place in Brussels this week, and did not address the divorce bill directly.

The European Commission declined to comment.

Asked about the reports, Transport Secretary Chris Grayling, a Brexit supporter, told BBC radio: “We are paying the EU almost £10 billion (US$13.3 billion) a year net anyway.

“We don’t want to walk away on bad terms,” he said.