UK’s exit will raise Ireland’s EU funding contributions at least €1bn

FINANCE Minister Paschal Donohoe has for the first time conceded the minimum price of Brexit for the Irish taxpayer will be €1bn, even if there is a deal.

Mr Donohoe has been understandably coy about the fiscal implications of Brexit on Ireland’s contribution to the EU budget.

But responding to queries by Fianna Fáil’s Éamon Ó Cuív on the projected increase in the net contribution by Ireland each year to the EU from 2021 to 2027 after Brexit, Mr Donohoe said Ireland’s annual contribution

‘Exact impact depends on agreement struck’

will rise to €3.85bn by 2027.

This will represent a €1.3bn increase on the most recent final figures for 2018, of €2.519bn.

Ireland has, up to November 2019, paid EU contributions of €2.288bn.

These figures only apply to a scenario in which the UK leaves the EU with a deal on January 31, 2020.

A disorderly exit could, however, see a further increase in the Irish payments.

‘Given that the UK represents one of the largest net contributors to the EU Budget, Brexit is likely to have a significant impact on the contributions of all member states, including Ireland,’ Mr Donohoe warned.

He said the exact impact ‘will be dependent on the nature of the final agreement between the EU and the UK regarding its involvement with the EU budget post-Brexit’. However, Mr Donohoe stressed that there has been no final agreement on the size of Ireland’s contribution.

The contributions of each member state to the EU budget include Traditional Own Resources (Customs Duties) and a portion of VAT, with the remainder coming from gross national income (GNI).

Mr Donohoe also said that no matter what happens on Brexit, Ireland is also forecast to see significant growth in EU contributions as a result of ‘continued economic growth, increased expenditure and the departure of the UK’.

Commenting on the figures, Labour Finance Spokesperson Joan Burton warned: ‘This could push us fairly high up the EU contributors list . . . Until relatively recently, we were a net recipient of funding so it would be quite a turnaround.’

Ms Burton also warned that the figures ‘confirm the ongoing status of Brexit continuing to provide the mother and father of headaches for Ireland and the EU as we face the unknown consequences of a large member state leaving the EU after more than 40 years’.

One doleful minister warned: ‘Paschal is not going to have too much cash left for tax cuts by the time the EU mandarins finish with us.’