Source: Breakdown of Britain’s €60 billion exit bill
The London press seems not to have spotted the issue of the UK’s exit bill, otherwise we would be hearing more of it. When it does explode into the tabloids details are likely to be hazy, so it is worth mugging up on them in a new report from the Centre for European Reform:“The €60 billion Brexit bill: How to disentangle Britain from the EU budget”
The €60 billion covers Britain’s potential obligations in three main areas: legally binding budget commitments that will be paid after Britain leaves; pension promises to EU officials; and contingent liabilities – such as bailout loans to Ireland – that would only require payments in certain circumstances.
“There are few clear legal precedents regarding the liability of departing members of international organisations. But in the Brexit talks, the issues will largely be settled by politics, not law. Some EU negotiators want Britain to promise to honour its financial obligations as a precondition for trade and transition talks. The EU-27 are confident Britain will eventually pay, because the costs of a disorderly Brexit are much higher. Theresa May is open to limited contributions to participate in future EU programmes.”
How solid is the €60 billion figure? The Economist Magazine reports that chief EU Michel Barnier thinks the true figure is somewhere in the €40-60 range so there must be some room for argument. Barnier wants this and other exit issues settled first while the British want parallel talks on future trading relationships, so there may be playoff between amount and sequencing. The Economist is rather pessimistic and talks of blazing rows already between British and EU officials.