Wednesday

23rd Aug 2017

UK will have to pay beyond Brexit, EU warns

  • Oettinger said the EU budget could be reinforced by new payments and cuts as the UK leaves the bloc. (Photo: European Parliament)

The EU's budget commissioner has warned that the UK would have to pay into the EU’s coffers until at least 2020, even after it has left the bloc in March 2019.

Guenther Oettinger told the German newspaper Bild on Monday (7 August) that Britain is obligated to honour commitments it has made to the EU’s long-term programmes.

The commissioner confirmed earlier calculations that the UK would have to pay even after Brexit, as some of the programmes and funds, which Britain has committed to, run on after 2019.

In May, the European Commission outlined its position on the single financial settlement the UK needs to pay to settle its bills before leaving the EU.

In it, the commission argued that the settlement should include the EU budget, funds, facilities and EU bodies the UK has to paid into.

It also mentioned that the UK, for instance, should continue financing teachers it sent to European schools around the continent until the end of the academic year - ending in 2021.

EU officials also pointed out that the UK would have to pay beyond 2019, as obligations stemming from EU cohesion funds could extend until 2023, when the final bills come in from the programmes.

The German budget commissioner said the holes in the EU budget caused by the UK’s exit from the bloc could be filled up by extra payments from member states and budget cuts.

He said the annual loss to the budget would be €10-12 billion.

Oettinger told Bild that he expected Germany to face extra costs in the single-digit billion-euro range.

40 billion

The commissioner’s comments come as the Sunday Telegraph reported that the government in London is ready to pay €40 billion if the EU agrees to negotiate the financial settlement as part of the deal on future relations - including a trade deal.

An EU source told EUobserver that one of the stumbling blocks over the financial settlement in the Brexit talks is that the UK sees the financial settlement as a way to pay for what it will get from the EU in a future deal.

The EU, however, sees the financial settlement as part of the divorce, and obligations that stem from commitments prior to the UK holding the Brexit referendum last June.

The 40 billion sum was dismissed by Downing Street sources, speaking to the Guardian. Several Conservative MPs questioned the need to pay at all.

Britain’s Brexit minister, David Davis, only acknowledged last month that the UK would honour those earlier commitments, but did not go into the details.

But the UK has so far failed to come up with its own position on how and what it would want to pay as it leaves the EU.

The EU’s chief negotiator, Michel Barnier, told EU ambassadors earlier that the lack of a UK position on the financial settlement is one of the main obstacles to any progress in the Brexit talks.

He told representatives of EU member states that the self-imposed deadline of October - to find an agreement on the key issues - is unlikely to be reached if the talks proceed at the same pace as they have so far.

Only when “sufficient progress” has been made on the financial issue - along with citizens’ rights and the border between Ireland and Northern Ireland - can talks move onto their next phase, including trade talks, the EU argues.

The bloc's position paper makes no mention of a sum for the financial settlement and says that the exact method of calculation should be agreed in the first phase of negotiations.

It adds that the schedule and the modalities of the payments should be defined in the second phase of the talks.

Earlier figures of between €60 billion and €100 billion have circulated in the media.

EU urges UK to clarify its Brexit positions

EU and UK negotiators presented their Brexit positions to identify common grounds this week, but that was made difficult by the scarcity of UK position papers.

Barnier urges UK to come up with Brexit positions

The EU's negotiator calls on the UK government to come up with its positions on key Brexit issues ahead of the next round of talks on Monday. London is expected to do that by the end of the week.

Barnier sets price for hard Brexit

The EU Brexit negotiator warned that a customs union between the UK and EU will not be possible if the UK doesn't want to respect single market rules, and "no deal" would send the UK back to "a distant past".

May clings to power with Northern Irish unionists

May announced the formation of a minority government with Northern Ireland’s Democratic Unionist party. She might not be in power for too long, and the clock keeps ticking for Brexit negotiations.

Brexit realities dawn in UK

Just over a year after a small majority voted for Britain to leave the EU, new realities are dawning on both the in and the out camps.

EU agency relocation race starts with 23 cities

Cities from 21 countries have applied to host the two London-based EU agencies, which will have to be relocated after Brexit, with Luxembourg throwing its hat in for the banking authority.

News in Brief

  1. Air Berlin insolvency talks begin amid 'stitch-up' accusation
  2. EU calls on Serbia and Macedonia to remain calm
  3. Schulz wants US to remove nuclear weapons from Germany
  4. Ukraine and Russia to announce another ceasefire
  5. EU to investigate Monsanto-Bayer merger
  6. US will ask Nato allies to send more troops into Afghanistan
  7. Greece to be absent at event on Communism and Nazism
  8. Czechs want observer status in Eurogroup meetings

Stakeholders' Highlights

  1. European Jewish CongressEuropean Governments Must Take Stronger Action Against Terrorism
  2. European Healthy Lifestyle AllianceDoes Genetics Explain Why So Few of Us Have an Ideal Cardiovascular Health?
  3. EU2017EEFuture-Themed Digital Painting Competition Welcomes Artists - Deadline 31 Aug
  4. ACCABusinesses Must Grip Ethics and Trust in the Digital Age
  5. European Jewish CongressEJC Welcomes European Court of Justice's Decision to Keep Hamas on Terror List
  6. UNICEFReport: Children on the Move From Africa Do Not First Aim to Go to Europe
  7. Centre Maurits CoppietersWe Need Democratic and Transparent Free Trade Agreements Says MEP Jordi Solé
  8. Counter BalanceOut for Summer, Ep. 2: EIB Promoting Development in Egypt - At What Cost?
  9. EU2017EELocal Leaders Push for Local and Regional Targets to Address Climate Change
  10. European Healthy Lifestyle AllianceMore Women Than Men Have Died From Heart Disease in Past 30 Years
  11. European Jewish CongressJean-Marie Le Pen Faces Trial for Oven Comments About Jewish Singer
  12. ACCAAnnounces Belt & Road Research at Shanghai Conference