UK will pay billions a year to EU for decades
BRITAIN: The United Kingdom will be paying European Union bills for decades, after the government bowed to demands from Brussels to meet its long-term financial liabilities to the bloc.
Prime Minister Theresa May will make an improved offer next week in which she will promise to pay the costs of all existing EU projects and pensions signed off while Britain was a member.
The total cost, likely to be between €40 billion (NZ$68.7b) and €50b, will not be settled as a lump sum but will be spread over a period of up to 40 years on a diminishing scale ‘‘when [the bills] fall due’’.
EU diplomats expect May to use that language when she tables the offer at a meeting on Tuesday with Jean-Claude Juncker, president of the European Commission.
The wording will satisfy EU governments that there will be no shortfalls in European projects, or the pensions of retired Brussels officials, without the need at this stage of the negotiations to specify a figure for the total settlement.
The offer will mean that Britain will continue to contribute billions of pounds a year to EU budgets at least for the next decade, with lower figures beyond that.
The payments undermine the central claim by the Brexit campaign during the referendum that Britain would have an extra £350 million a week to spend on the National Health Service when it left the union.
The figure was cited by Leave campaigners, including Boris Johnson and Michael Gove, as the amount that Britain would save in gross EU contributions each week.
‘‘All we need is four extra words,’’ a European negotiator said of May. ‘‘At Florence she said, ‘The UK will honour commitments we have made during the period of our membership’. All we need is the phrase, ‘when they fall due’ added to the end of the sentence.’’
The development comes amid a dispute over the government’s secret reports on the impact of Brexit.
David Davis, the Brexit secretary, provided an 850-page dossier of information to the Brexit select committee yesterday, but sensitive information had been withheld.
A Whitehall figure who has studied the edited reports in detail says they are ‘‘misleading’’ and look like a whitewash.
Details of the key variables needed to calculate a total ‘‘bill’’ would not be given, one negotiator said.
Progress is also understood to have been made on the issue of the Northern Irish border, with officials on both sides looking at finding face-saving diplomatic language until full-blown trade negotiations take place next year.
If the talks between May and Juncker next week are successful, EU ambassadors will begin to discuss the terms of negotiations on a two-year transition deal.
Any new financial offer is likely to be controversial among Brexiteers, although it was signed off by a key committee that included Johnson and Gove last week.
Nigel Farage, the former leader of Ukip, described it yesterday as a ‘‘bad deal’’.